Coimbatore MSMEs Struggle as Power Costs Soar

Coimbatore, Jul 17 (KNN) The recent surge in electricity charges has sent shockwaves through the Micro, Small and Medium Enterprises (MSMEs) sector in Coimbatore, with industry leaders warning of dire consequences for the state's manufacturing landscape.

M. Karthikeyan, president of Coimbatore District Small Industries Association (CODISSIA), highlighted the severity of the situation, noting that power costs now account for up to 35 per cent of production expenses for foundries and 15 per cent for engineering industries.

"Many small and micro units will quit manufacturing as they are now running the units with their own funds," Karthikeyan cautioned.

The CODISSIA has called for an emergency meeting of all industrial associations in Coimbatore on Thursday to collectively demand a rollback of fixed charges.

Karthikeyan emphasised, "We are not opposing the tariff hike. What we cannot sustain is the hike in fixed charges every year. No other State has such high fixed charges."

Adding to the chorus of concern, Mithun Ramdas, president of the Southern India Engineering Manufacturers Association, pointed out the competitive disadvantage faced by Tamil Nadu's MSMEs due to manufacturing subsidies offered in Gujarat. He warned that the power cost hike could push the sector into a "critical situation."

The impact on micro units is particularly severe, according to J. James, coordinator of the Federation of Coimbatore Industrial Associations, who described the 430 per cent hike in fixed charges as "a huge burden."

The textile industry has not been spared either. The Southern India Mills' Association highlighted the disparity in power tariffs between states, noting that Maharashtra offers concessional rates for shuttleless looms, while Tamil Nadu applies regular tariffs, potentially rendering the powerloom sector uncompetitive.

In response to the growing crisis, the Tamil Nadu Small and Tiny Industries Association (Tanstia) has appealed directly to Chief Minister M.K. Stalin for intervention.

C.K. Mohan, president of Tanstia, expressed disappointment over the lack of stakeholder meetings promised by the Chief Minister to address the issue of fixed charges for LT and LT III-B industries.

As the controversy unfolds, the future of Coimbatore's vibrant MSME sector hangs in the balance, with industry leaders calling for immediate action to prevent what they describe as a potential "killing" of local industries.

(KNN Bureau)