The Confederation of Indian Industry, Kerala Region, has opposed the power tariff hike, saying that it would hit industries in the State.

Umang Patodia, chairman of the taskforce on power, CII Kerala State Council, said the Kerala State Electricity Regulatory Commission’s decision to hike the power tariff over 30 per cent for all categories of consumers will drastically hit the core industries in Kerala.

This will adversely affect the businesses, thereby shifting the burden to the general public, who are dependent on this sector, he said.

He pointed out that the increased power tariff has adversely affected the industrial operations of the manufacturing sector. Power is the major input for the manufacturing and MSME industry. Large-scale manufacturing companies such as minerals, paper, textile etc will be hit hard, he said.

As it is, generally in Kerala, the cost of sourcing raw materials and labour costs are significantly higher than in neighbouring States, Patodia said.

Increase in power tariff will also drastically affect the sustenance and growth of manufacturing sector in Kerala and will most certainly lead to the eventual closure of many of the units.

To support the growth and sustainability of the existing industry, he said, tariff shocks have to be avoided and any revision of power tariff must be in a graded manner over a three-year period, making it viable for the industry, Patodia added.

KCCI stand

The Kerala Chamber of Commerce and Industry said that the industry would face an additional burden of Rs 450 crore, especially due to tariff hike.

This will be a challenge to the industry at a time when various sectors are facing serious financial crisis due to high production cost and other factors.

The Chamber is also of the view that KSEB has not taken any sincere efforts to increase power generation or to reduce transmission loss. K.N. Marzoook, chairman, said that the Chamber is not against any hike in power tariff, but it should be done in an appropriate and gradual manner.

(This article was published on July 29, 2012)
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