Sale of generators up with power outages
By Aamir Shafaat Khan
KARACHI, March 11: The sale of power generators has picked up momentum as the load-shedding has become a daily routine with the start of the summer season.
The sale of generators has surged by 100 per cent in the last one and a half years. Generator shops are now full of stocks along with the presence of a good number of buyers.
The majority of consumers prefer to install a gas device of Rs1,500 in petrol generators, which according to importers costs Rs4-5 per litre per hour against Rs60 per litre per hour without the device.
Karachi consumed about 40 per cent of total generator imports last year, while the rest of the country accounted for 60 per cent machines. Now much depends on the power supply situation in the Punjab.
China has now virtually captured the Karachi market by 90 per cent, while the rest of the share is mainly enjoyed by Japanese generators. However, like other products, the Chinese generators are of four different types thus allowing the consumers to choose the item as per their monthly income. However, buyers from the rich class prefer sound-proof Japanese generators. There is also a price difference of Rs6,000-6,500 in manual and self ignition system generators.
Household consumers are usually lifting generators from one KVA to 5- KVA, while there has been an increase in demand from the industrialists for 50KVA to 500KVA units in the last two years.
There is a slight upward trend in prices of generators as compared to last year because of imposition of one per cent federal excise duty, higher import cost owing to losing strength of the rupee against the dollar and high freight charges from China to the Karachi Port, which surged to $2,200-2,500 per 20 ft container currently as compared to $950 last year.
However, Karachi Generators Importers Group president Sikandar Shahzada told Dawn on Tuesday that the prices may go up further by 10-15 per cent in coming months owing to rising demand and problem of shipments delay from China by 45-60 days. He said that some elements in the markets are still active in bringing smuggled Chinese generators through the Quetta route but its share ranges between five to 10 per cent. However, the smuggled generators’ share in Punjab is 20 per cent and these are coming through Peshawar.
A smuggled generator of 2KVA (petrol) sells between Rs12,000-13,000, while an imported piece (arriving legally) is priced between Rs15,000-25,000 (depending on the quality).
Around 70 per cent market share is enjoyed by petrol generators, (which are later turned into gas because of low price) followed by 15 per cent each by gas and diesel generators.
The import duty on generators running on petrol is 10 per cent and one per cent income tax, while duty on diesel generator is 20 per cent and one per cent income tax.
The import of power generating machines in July-January 2007-08 stood at $517.6 million as compared to $428.6 million in the same period of last fiscal. In 2006-07, imports surged by 38 per cent to $706 million from $511 million in 2005-06.
INDUSTRY: Despite a scheduled load-shedding from 0:7 to 11:00pm daily, the industrialists complain about two to three hour power outages daily.
F. B. Area Association of Trade and Industry Chairman Idris Gigi said that the cost of production through stand-by diesel generators goes up phenomenally as generators cost Rs12 per unit as compared to Rs6 per unit. But the industries have to bear the high cost of production as they have to meet their shipment schedule committed to the foreign buyers.
North Karachi Association of Trade and Industry chairman Noor Ahmed said that around 50 per cent units out of 1,500 have stand-by generators, while 10-12 units have captive power units. The area, he said, is facing load- shedding of one to two hours daily.
Korangi Association of Trade and Industry Chairman Shaikh Fazle Jalil said that only 10 per cent units out of total 4,500 units have captive power units while 20 per cent have stand-by generators.
Site Association of Industry chairman Nisar Sheikhani said only 15 per cent units out of total 3,000 units have power generators while five per cent have captive power units. However, he said Site is not facing any power failures.
SHOPS: There is a conflicting view between the Alliance of Market Association (AMA) and Tariq Road Traders Association (TRTA) about the availability of power generating units in the markets.
AMA chairman Atiq Mir said that that generators’ presence in the markets was about two per cent, which are being managed jointly by many shopkeepers but 15-20 per cent of the big markets have their own generators.
TRTA President Siddiq Memon said that 35 per cent of the shopkeepers have power generating units.