PFC Wants Targeted Measures as Benefits of Tariff Cuts Fall ShortBy

Muhammad Shahzad | Lahore, Pakistan
LAHORE: The Pakistan Furniture Council (PFC) has voiced concern that recent energy tariff relief measures, introduced to enhance industrial competitiveness, are not delivering meaningful benefits for a significant segment of the industrial sector, including furniture manufacturing.
While the government’s incremental package reduced electricity tariffs by Rs4.04 per unit for industrial consumers, PFC Director Shahbaz Aslam said higher fuel costs and quarterly adjustments have substantially diluted the effective relief, limiting the intended impact on production costs and export competitiveness.
Shahbaz Aslam noted that the government reported benefits reaching 127,686 industrial consumers during December and January 2025-26, with cumulative financial relief amounting to Rs12.125 billion. However, the PFC pointed out that the reduction largely benefitted smaller or non-operational industries, while larger manufacturers—particularly those in the B3 and B4 categories, which contribute significantly to production—were unable to fully utilise the package.
The furniture sector, in particular, reported minimal relief due to ongoing energy cost adjustments that offset much of the announced tariff cuts.
The PFC Director emphasized that although the package was designed to improve industrial competitiveness and support export-oriented businesses, the practical benefits for energy-intensive sectors like furniture production have remained limited. The recalibration of fuel cost adjustments and the shift of tariff reference cycles from fiscal to calendar year, combined with quarterly revisions, have diluted the impact, leaving many industrial units with only a fraction of the intended savings.
The council urged the government to introduce more targeted and sector-specific energy relief measures to ensure meaningful support for industries contributing to export revenue and domestic employment. Furniture manufacturers, like other export-oriented businesses, operate on tight margins and depend on predictable energy costs for planning, pricing, and sustaining international competitiveness.
Highlighting additional challenges, the council noted that volatility in electricity tariffs has disrupted production schedules and procurement decisions, creating uncertainty for both domestic and international orders. The PFC recommended closer coordination between the Power Division and industry representatives to ensure that relief packages effectively reach operational enterprises and that structural issues affecting energy pricing are addressed.
While acknowledging the government’s commitment to supporting industrial growth, the council called for a review of the incremental tariff package to ensure sustained benefits across larger and operational industrial segments. Targeted adjustments, along with improved planning transparency and predictable pricing mechanisms, were identified as essential steps to strengthen the sector’s ability to compete in global markets.
The council warned that without meaningful and consistent energy relief, export-oriented industries—including furniture manufacturing—may continue to face cost pressures that undermine productivity, competitiveness, and employment generation, despite broader efforts to support the industrial sector.