'Maharashtra to reassess hike in power tariff'

Samrat Phadnis | Nov 15, 2013, 02.42 AM IST

KOLHAPUR: The state government is considering reassessment of the recent power tariff hike, which has adversely affected the industry, indicated cabinet ministers in the city on Thursday. Foundrymen had warned the leaders that industrialists would prefer to shift base to Karnataka, where the power tariff is lower than that in Maharashtra. Ministers Rajesh Tope,Hasan Mushrif and Satej Patil assured industrialists that the state is working to reach a consensus on the issue. "Chief minister Prithviraj Chavan and deputy chief minister Ajit Pawar, who is also the state energy minister, have formed a committee to reassess the power tariff and the government will provide some relief to the industrial sector," said minister of state for higher and technical education Rajesh Tope, who was in the city to inaugurate the metallurgy institute, Dhatu Tantra Prabodhini. "I have handled the energy portfolio and understand the situation the power generation and distribution companies face at present. We also know that the cost of production has increased due to the power tariff hike and this has made industrial production weak. I assure you that the government is working on finding a solution. The power tariff hike has received a negative response in every district of the state," Tope said. However, the minister refused to give a deadline and said a decision on the issue would be taken soon. Echoing similar sentiments, state labour minister Hasan Mushrif said a decision on the issue would be taken at the earliest. State rural development minister Satej Patil said, "We expect the committee, which has been set up under the chairmanship of senior minister Narayan Rane, to provide recommendations." Industrialists from Kolhapur along with other foundrymen raised the issue of expensive power in Maharashtra have been pursuing the government to rollback the power tariff hike. The state government has responded positively for the first time. "Kolhapur is located near the Maharashtra-Karanataka border. Thee industrial sector from Hubli to Belgaum is rapidly developing. If the government fails to restructure the power tariff, the industrialists might shift base to Karnataka," said chairman of the Gokul-Shirgaon Manufacturers' Association, one of the largest industrial sectors in Kolhapur, Chandrakant Jadhav. The Indian foundry industry is a leading engineering sector with an annual production of over 7.4 million tonnes of castings, accounting for about 8% to 9% of the total production in the world. The country has approximately 4,500 foundry units, of which 90% can be classified as small-scale units, 8% as medium-scale units, and 2% as large-scale units. Kolhapur has over 350 foundries. The powerloom industry, that had stalled work for five days last week, has also been hit by the power tariff hike. Maharashtra Electricity Regulatory Commission's ( MERC) order in early September to recover Rs 3,685.51 crore from power consumers has upset industrialists as they are forced to pay an average of Rs 1.25 for every unit of extra consumption.