Kovai SMEs seek SEZ, TUF scheme

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Chennai, Jan 8 : A special economic zone for small and medium engineering industries like foundry and pumps, technology upgradation fund (TUF) scheme for foundry and pump manufacturing units, as for the textile industry, government intervention to control prices of pig iron and coking coal, the essential raw materials of these industries, streamlining of engineering education to meet the manpower needs of the industries, and quality power supply are among the major requisites of the small and medium enterprises in the Coimbatore region for their survival, modernisation and expansion.

A special economic zone would help increase exports from the small and medium engineering industries like foundry, pump, motor and auto components, C R Shanmughasundaram, president of the Southern India Engineering Manufacturers’ Association (SIEMA), said.

In order to develop capacities in motor, pump, foundry and auto component industries, the government should provide Technology Upgradation Fund (TUF), as in textile industry, which would not only help the engineering sector, but also attract large investments, he said.

SIDBI should continue the credit linked capital subsidy scheme, which was kept in abeyance, for the benefit of SMEs.

Ever increasing price of steel and coking coal has been one of the major problems of the small and medium units in Coimbatore. In the wishlist for the engineering industry in the region for 2008, Shanmughasundaram said industry has been expriencing problems due to ‘sudden, abnormal and frequent increase’ in prices of basic raw materials like pig iron, steel, coking coal, ferro alloys. “Owing to this we have not been able to keep up commitments and even to accept orders fromn principal buyers,’’ he said.

‘’Against the abnormal increase in the prices of raw materials, industries are not in a position to hike the selling prices of the end products to match input cost and thereby affecting the margin considerably,’’ he said.