6 % decline in Power demand but rise in Unemployment after Nov 8

New Delhi, Dec 27 (KNN) On one side, power demand has come down drastically while on the other hand unemployment has risen due to cash crunch after November 8, 2016.

With industrial activity slowing and an acute cash crunch in the aftermath of demonetization, it has created problems for industries.

While talking to KNN, Ram Lall Khetan, President of Bihar Industries Association (BIA) admitted the cash crunch to be the main reason for the decrease in power demand.

He said less production forces the small industries to discontinue their manufacturing activities.

“Due to cash crunch, industries are not able to sell. Production fell down abruptly, small industries are not able to continue their business. This has resulted into less demand of electricity and rise in unemployment,” said Khetan.

Calling it an unplanned move by the government, he said the government has no cash and now the only thing they can do is to divert the minds of people.

“Government has no cash to supply, now they have to divert the mind of the people in order to continue their move. Because without cash, the problem will not end," added President, BIA.

He said that government is claiming to move towards digital India, first they have to understand the actual availability of internet or mobile facility to the people of the country.

“Government is just giving examples of mobile but they don’t know that it took nearly 20 years to understand the mobile,” said Khetan.

According to experts tracking the sector, peak power demand is down six per cent between September and November 2016. On a year-on-year basis, though, demand grew 11 per cent in September 2016, according to the latest data of Central Electricity Authority.

With demonetization kicking in from November 8, 2016, from medium, micro and small enterprises (MSMEs) have reduced their power demand owing to slow activity.  Peak power demand deficit — the gap in power supply and demand – has also reduced owing to decline in power demand during the past month.

The peak demand deficit in November was 0.6 per cent, down from one per cent in October and 1.6 per cent in September 2016. Agricultural power demand is also likely to go down as the current sowing season has been hit by cash crunch.

Stagnant power demand forced 30 power-generating companies to reduce their coal off take, even below their lowest permissible threshold under the respective fuel-supply agreements with Coal India. (KNN/RAS)