The Pakistan Textile Council (PTC) has called on the Prime Minister’s Office (PMO) to urgently eliminate cross-subsidies in industrial electricity tariffs and discontinue the peak/off-peak pricing regime, warning that the current power structure is undermining Pakistan’s export performance.

In a formal letter addressed to Dr Syed Tauqir Hussain Shah, Adviser to the Prime Minister, the Council argued that embedded cross-subsidies have inflated industrial energy costs to uncompetitive levels, particularly for export-oriented textile manufacturers.

PTC stated that the cross-subsidy burden estimated at PKR 160 billion across XWDISCOs and KE is being transferred onto industries through higher tariffs, raising production costs and encouraging a shift toward off-grid captive power. The Council maintained that removing the subsidy component would allow industries to face actual cost-reflective tariffs, improve grid utilisation, and help prevent further off-take from the national system.

The Council also expressed concern over the Time-of-Use (ToU) tariff framework, under which industries pay higher prices during peak hours and lower rates during off-peak periods. According to PTC, exporters operating around the clock provide stable baseload demand but are penalised by peak-hour charges, leading to output reductions or unsustainable cost absorption. With incremental tariff mechanisms already in place, the Council argued that the rationale for ToU pricing has diminished and warrants immediate review.

Highlighting the broader implications, PTC noted that textile and apparel exports have declined across all major product categories in key markets such as the United States, the European Union, and the United Kingdom during the first half of FY2025-26. Describing the situation as an “export emergency,” it warned that competing regional economies are rapidly advancing through favourable energy pricing and upcoming trade agreements, putting Pakistan at risk of further erosion in global market share.

Despite the challenges, PTC stressed that Pakistan retains the industrial base, skilled workforce, and international buyer relationships needed to support an export-led recovery provided the energy policy framework becomes predictable, rational and cost-competitive.