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Karnataka’s Populist Pricing Leads To Power Shortages, Alarms Industrialists

Updated: Oct 14, 2023 01:35:33pm

Karnataka’s Populist Pricing Leads To Power Shortages, Alarms Industrialists

Bengaluru, Oct 14 (KNN) The Karnataka industrialists are growing concerned about the impact of the current power shortage in the state on their production, reported Deccan Herald.

While the government has not made an official declaration of load shedding, there have been recent unscheduled disruptions, which industry bodies are referring to as 'unofficial load shedding.'


However, it is not the situation at hand but the future is what they are worried about, reported DH citing the industrialists.

Ramesh Chandra Lahoti, president-elect, Federation of Karnataka Chambers of Commerce and Industry (FKCCI) said, “The future looks grim. Given the crisis the state is going through, we are worried that there could be disruptions. We, as consumers, will not be able to arrange for power supply at competitive rates if there is a severe crisis in the future.”

“Hence, the government should get into talks with other states as well as private players to ensure there are no disruptions over the next few months,” he said.

The situation poses a double-edged dilemma for industries. Power disruptions could harm production and profit margins, while the government's expensive power purchases to prevent disruption may lead to higher Fuel and Power Purchase Cost Adjustment (FPPCA) charges, adding to the burden on industrialists.

Suresh N Sagar, governing council member, Karnataka Small Scale Industries Association (KASSIA) said, "It is crucial that the government negotiates the prices well. Procuring power at higher prices will flow down to the industrialists and this in turn will bring down the profit margin. Not all industries can bear the brunt." 

Any reduction in profit margins could have a ripple effect on the business, explained Shiva Kumar R, president-elect, Peenya Industries Association.

The industry bodies urged the government to take immediate measures so that they have a well-planned contingency plan for the next few months.  (KNN Bureau)


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