Coimbatore MSME Bodies Flag TN Budget Gaps Over Lack Of Power Cost Relief And MSME Support Measures

Chennai, Aug 6 (KNN) Associations representing micro, small and medium enterprises (MSMEs) in Coimbatore have described the Tamil Nadu Budget 2026–27 as “disappointing,” citing the absence of key measures to ease cost pressures on small businesses.

Industry bodies said long-pending demands, particularly reductions in electricity fixed and demand charges, were not addressed despite significant allocations for the power sector and MSME financing, TOI reported.

Power Sector Spending Welcomed, Tariff Relief Missing

The Tamilnadu Association of Cottage and Micro Enterprises welcomed allocations for power infrastructure, including Rs 4,000 crore for the Coimbatore–Ariyalur 765 kV transmission corridor, Rs 1,543 crore for 178 new substations and Rs 2,000 crore to replace 40,000 ageing transformers.

However, it termed the lack of any announcement to reduce fixed electricity charges—from Rs 170 to Rs 35—as a major disappointment for micro and small units. The association also noted the absence of proposals for exclusive industrial estates for micro enterprises, a raw material bank, or a dedicated board for the segment.

Rising Costs Continue to Weigh on MSMEs

M Jayabal, President, Recycle Textile Federation, said the sector had expected the budget to address concerns of Tamil Nadu’s estimated 4.8 million MSME entrepreneurs.

He pointed out that industry bodies had sought a 50 per cent reduction in fixed charges, which they say have risen by nearly 480 per cent, along with a similar cut in demand charges and a waiver of solar network charges. The absence of these measures, he said, would add to the financial burden on MSMEs.

Growth Vision Lacks Concrete Measures

The Coimbatore Compressor Industrial Association said the budget’s target of raising Tamil Nadu’s gross output to USD 1.5 trillion by 2036 was ambitious, but lacked new and concrete initiatives needed to achieve it.

While welcoming the focus on youth welfare, employment, education modernisation and student facilities, the association said the Rs 2,142 crore allocation for MSMEs was insufficient. It also highlighted the lack of steps to reduce power tariffs or improve ease of doing business.

(KNN Bureau)