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Mills in TN complain of 45% utilisation loss at SIMA meet
Oct '08
An urgent meeting of Managing Directors of all Member Mills in Tamil Nadu was convened by the Association on 15th October 2008 to discuss the crisis due to current power scenario.

The member mills in Tamil Nadu felt that due to the recent increase in power shortage to 9 ½ hours and more per day, they were incurring utilisation loss of around 45% and higher.

This was causing a serious financial crunch resulting in default of payments to the bank, inability to pay bonus to the worker on time for Diwali, not able to procure adequate cotton during the peak season, etc.

The member mills therefore, urged SIMA to appeal to the Government to speed up the implementation of the Diesel Model and utilise idle capacity of High Speed Diesel Generators of over 3500 MW available with the industry to overcome the acute power shortage and avoid losing production to the tune of 40% currently in Tamil Nadu.

The textile industry which employs close to 10 million people directly and indirectly in the State, has been reeling under an unprecedented crisis and facing closure problem in the absence of an immediate solution for the power crisis.

The Government had indicated to favourably consider the “High Speed Diesel Oil Model” proposed by the industry as a solution to overcome the power crisis to sustain the survival of the industry in the State. SIMA member mills were of the strong opinion that this was only immediate solution to tide over the power crisis threatening the survival of the industry.

While welcoming the efforts made by the Government to ensure adequate availability of diesel, though expensive and exempting the same from VAT for power generation, Dr Srinivasan has strongly felt that the industry will not be in a position to operate the gensets and help TNEB due to exorbitant cost of captive generation unless the HSD model was implemented.

Member mills in the meeting strongly felt that the Government should consider the genuine demand of the industry considering the investment of over Rs.50,000 crores over the last five years and have appealed to the Honourable Chief Minister of Tamil Nadu to immediately announce the implementation of High Speed Diesel Oil model and save the textile industry from closure, especially considering the fact that the power generated by the “Diesel Model” would ease the power shortage across the State to all consumers.

Considering the seriousness of the power crisis, Dr.Srinivasan informed that the member mills have urged SIMA to pass a Resolution stating that if the HSD oil model was not implemented by 22nd October 2008, they would have no other option, but to extend their full support to one-day stoppage of production on October 22, 2008, already called for by the Engineering and other Associations across the State.

Further, he informed that the member mills requested SIMA to urge the TNEB to distribute the power shortage equally across all the consumers in Tamil Nadu.

Southern India Mills' Association

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