Power tariff hike hurting Tamil Nadu textile sector:  SIMA

Tamil Nadu's once-thriving textile industry is facing a severe downturn due to rising power costs and lack of competitiveness. Despite being a major contributor to the state's economy, the industry has been hit hard by increased power tariffs, outdated machinery, and high raw material costs.

Power shortages from 2008 to 2015, followed by continuous tariff hikes, have eroded the industry's profitability. The spinning sector, in particular, is struggling with over 70 per cent of its capacity being more than 15 years old. Additionally, the state's dependence on raw material imports has exacerbated the problem, as rising fuel costs inflate production expenses.

Compared to competitor states like Gujarat and Maharashtra, which offer incentives and lower power tariffs, Tamil Nadu's textile industry is at a disadvantage. The state's powerloom sector is also facing challenges due to higher power costs compared to Maharashtra.

The recent power tariff hike of 4.83 per cent has further compounded the industry's woes, prompting the Southern India Mills' Association (SIMA) Chairman, SK Sundararaman to appeal for its withdrawal. SIMA argues that the hike comes at a time when the industry is already grappling with recession and job losses. Linking power tariffs to the Consumer Price Index is also criticized as inappropriate.

To revive the industry and protect jobs, SIMA has urged the Chief Minister to suspend the power tariff hike for at least two years.