Undependable power supply and non-competitive power tariff are making the textile industry helpless before the domestic and international competitors. According to the chairman of the Southern India Mills' Association, SV Arumugam, "the textile industry inTamil Nadu is incurring huge losses due to frequent tripping of power.

The industry finds it difficult to compete with the neighbouring states like Andhra Pradesh and also other countries like China, Pakistan, Bangladesh, Thailand and Indonesia, in the global and domestic markets due to higher power tariffs.'' He said Andhra Pradesh offered to supply power to the HT consumers at Rs.2.50 per KWh in the long run. It is offering up to Re1 per KWh incentive for the new investments made in the textile industry for the first five years of commercial production. This would enable a 50,000-spindle mill to save Rs 25 crore to Rs 30 crore in five years on power tariff when compared to a new mill built in Tamil Nadu, he said.

The textile industry, with 860 non-SSI and 924 SSI category mills, which use power round the clock, is the single largest consumer of the Tamil Nadu Electricity Board. The state now has about 45% of the spinning capacity in the country. SIMA chairman asked the board to bring down power tariff on par with competing countries and Andhra Pradesh and also ensure uninterrupted power to sustain the competitiveness of the textile industry in Tamil Nadu.

"The cost of power in Tamil Nadu for a spinning mill used to be 2% of sales turnover in the sixties, 5% in the eighties and now it is over 14%. Barring raw materials, power constitutes over 35% of the conversion cost for spinning mills. Therefore, it determines the survival of textile mills is power cost," Arumugam said. The textile industry has become extremely sensitive to power cut even for a minute, thanks to the use of highly sophisticated computer/microprocessor-controlled machines and centrifugal compressors.

Frequent power cuts caused huge losses to the industry during the last financial year. In the recent months, the situation has aggravated. Machinery utilisation loss due to power cuts is around 10%, he said. Even in the 110 KVA line, the power tripping has become very common and on an average, at least one tripping occurs every day even in 110 KVA line. "This clearly indicates the poor power supply management system and or maintenance," the SIMA chairman said.

Source: Financial Express