KCCI appeals CM Bommai not to increase power tariff for MSME sector

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KCCI appeals CM Bommai not to increase power tariff for MSME sector

Mangaluru: Kanara Chamber of Commerce and Industry (KCCI) has appealed to Chief Minister Basavaraj Bommai, Energy Minister Sunil Kumar not to increase the power tariff for the MSME sector.

In an appeal, KCCI President Shashidhar Pai Maroor said, “The KCCI is shocked at the decision of Escoms proposing to increase Power tariff by Rs 2 per unit. The MSME sector in India is the second-largest employment generator after agriculture and acts as a breeding ground for entrepreneurs and innovators with considerable support in strengthening the business ecosystem. MSME sector contributed 29% to overall GDP,’ he noted.

With the Covid-19 pandemic and lockdowns impacting their cash cycles, MSMEs, who are the backbone of India’s inclusive growth story, have felt a significant impact and faced severe disruptions. As an important part of the domestic and global value chains, the plight of MSMEs is of deep concern, he said.

‘MSME sector will completely collapse if the power tariff is hiked. We appeal to Escoms to reduce their distribution losses and overheads instead of putting an additional burden on the consumers.

“The impact of the hike will be particularly disastrous for the MSMEs as they struggle to revive operations from the Covid pandemic and severe slowdown in the economy,’ he said and urged the Chief Minister to instruct the Escoms to withdraw the proposal and save MSMEs from closure.

Further, he said the announcement of countrywide lockdown dragged MSME owners, employers and external stakeholders in unexpected times, where no one had the experience to handle this kind of situation.

Extended lockdown had a negative impact on the supply of finished goods, procurement of raw material and availability of employees to work in production and supply processes.

“Post lockdown, MSME is facing challenges related to debt repayments, wages/salaries, statutory dues, etc. It is not only the MSME units that face challenges; even consumers are left with lower disposable income.

“Many enterprises laid off their workers because of inability to pay salaries, vacated their offices due to incurring expenses and halted their production due to stopped demand,’ he said.


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