Hike in power tariff by TANGEDCO will put MSMEs in Tamil Nadu under severe stress: BHELSIA president, Rajappa Rajkumar

Ease of Doing Business for MSMEs: BHEL Small Industries Association (BHELSIA) recently raised its concern over the sharp increase in power tariff by Tamil Nadu Generation and Distribution Corporation (TANGEDCO), according to The Hindu report. 

“It is very unfortunate that the State Government has imposed a huge increase in the power tariff. The objections raised during consultations have been totally ignored. Implementation of the revised tariff will result in total disaster for MSME units in Tamil Nadu,” stated Rajappa Rajkumar, president of BHELSIA, as per the report. 

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Rajkumar said that the implementation must be put to a halt immediately and there should be further consultations with industry associations. 

The Micro, small and medium enterprises (MSMEs) in Tiruchi region were already facing the brunt of recession that has been ongoing since 2014. While most of the units were under severe pressure, 25 per cent of them have already turned into Non Performing Assets (NPAs), rendering several workers unemployed, said Rajappa Rajkumar in a statement. 

The Industry association president added that the Central government has only extended short term relief. The MSME units may shift their operation to other states, if the situation does not improve impacting the tax income of the state government, the report said. 

Further, the Industry association president appealed to the Chief Minister and the Electricity Minister to address the issue on a priority basis. 

In another press statement, Tiruchi Trade Centre, Chairman, N. Kanagasabapathy said the revised tariff will spell doom for the MSME sector that has been hit by GST, COVID, and rise in fuel price, said the report. 

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He said, “The mindless increase in the power tariff was ill-advised and unjustified. There are indications that more than 80% of the consumers will apply for reduction on connected load with immediate effect in order to continue to run their industrial units as the new charges will be unaffordable.”

A minimum of 50 percent of the industries will be forced to close, unless the State Government rolls back the “unjustified, unreasonable, and unmindful” tariff revision, added Kanagasabapathy.