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Haryana SMEs crumbling under lopsided power supply
22
May '10
Haryana's small and medium enterprises (SMEs) totaling to over 76,000 are currently functioning below their capacity, owing to irregular and insufficient supply of electricity.

As per data received from the department of industries, the state has been witnessing a continuous rise in the number of micro, small and medium enterprises, from 70,326 in 2004-05 to 72,509 in 2006-07 and then reaching 76,693 in 2008-09. Despite this, the state government has failed in supplying the industries with the necessary infrastructure.

While the SMEs found in Ambala, Panipat, Karnal, Panchkula and Gurgaon are on the brink of turning into a disaster, the cluster of SMEs found in Panipat, which generates approximately Rs 40 billion through its yearly exports, is almost dependent on captive power, averred Ramesh Verma, President, Handloom Manufacturer's Association.

The increasing euro, dearth of labour force and fluctuating dollar had already adversely affected the industries. The electricity cut, has further, worsened the situation, added Verma.

In addition, owing to electricity cuts, most SMEs are functioning in single shifts. Also, the cost of captive power is Rs 12-13 per unit, which is about three times more expensive than state provided power, which is just Rs 4.50 per unit.

However, the most affected are exporters who had, last year, faced a shortage in the number of export orders due to world economic meltdown. Recovery of markets aided them in receiving bigger orders and they piled up input stocks so as to help them meet with the export orders on time.

Firm owners now fear that, the continuous irregular supply of power, might weaken their manufacturing capacities and they might eventually lose their global purchasers.

Fibre2Fashion News Desk - India

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