FPCCI demands audit of Rs1.5tr infrastructure cess as Sindh industrial zones face decay

The Federation of Pakistan Chambers of Commerce and Industry (FPCCI) has called for greater transparency in the utilisation of Sindh's infrastructure cess revenues, arguing that industrial areas continue to suffer from severe infrastructure deficiencies despite the collection of more than Rs1.5 trillion through the levy over the past five years.

Adeel Siddiqui, a member of the FPCCI Executive Committee, said the condition of the Hyderabad and Kotri industrial estates raised serious questions about how infrastructure cess funds had been spent, as manufacturers continued to face deteriorating roads, inadequate water supply and weak municipal services.

The Sindh government collects a 1.85 per cent infrastructure cess on imports, a levy originally intended to support the development and maintenance of industrial infrastructure across the province.

"More than Rs1.5 trillion has been collected under this head, yet major industrial zones remain deprived of basic facilities," Siddiqui said, calling on the provincial government to publicly disclose details of the expenditure of cess revenues.

The criticism comes as industries in Sindh continue to grapple with rising production costs and broader economic challenges. Siddiqui said manufacturers were already dealing with high electricity tariffs, fluctuating borrowing costs and a complex taxation regime, while provincial-level infrastructure shortcomings were further undermining competitiveness.

He said road infrastructure in the Hyderabad and Kotri SITE areas had reached an alarming state despite serving as key transport corridors for thousands of trucks and containers each day.

According to Siddiqui, damaged roads are increasing logistics costs, causing transport delays and exposing businesses to vehicle repair expenses and safety risks.

Industrial infrastructure has long remained a concern in Hyderabad SITE, one of Sindh's oldest industrial estates. Established in 1952 across 1,264 acres, the estate hosts around 665 industrial units, with roughly 450 currently operational, according to SITE management.

The industrial zone serves as a major processing hub for lower Sindh's agriculture sector, housing manufacturers involved in edible oil, rice and pulse processing.

SITE officials acknowledged that water supply constraints, drainage issues, deteriorating roads and the lack of fully functional treatment facilities remain among the estate's most pressing challenges.

An official said development schemes worth Rs1.10 billion were currently under execution to improve roads and drainage infrastructure after more than a decade of limited investment. However, he noted that the ongoing projects would address only part of the area's overall infrastructure requirements.

Siddiqui also highlighted worsening water shortages in several industrial areas, saying some factories were being forced to purchase water through tanker services or scale back operations, adding to production costs and reducing efficiency.

He urged PPP Chairman Bilawal Bhutto Zardari and Sindh Chief Minister Syed Murad Ali Shah to create a provincial investment facilitation authority with powers similar to those of the Special Investment Facilitation Council (SIFC).

Such an institution, he said, should be empowered to coordinate and resolve issues relating to roads, water supply, sewerage, electricity and law and order, which continue to hinder industrial expansion in the province.

Without sustained infrastructure investment and administrative reforms, industrial growth in Sindh would remain constrained, Siddiqui warned, while urging the provincial leadership to personally visit the Hyderabad and Kotri industrial estates to assess conditions on the ground.