Feature: Power cuts slash profits at India's small businesses

0 Comment(s)Print E-mail Xinhua, May 11, 2022
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by Peerzada Arshad Hamid

NEW DELHI, May 11 (Xinhua) -- Since the last month's power outage across the country, Hilal Ahmad a small manufacturer on the outskirts of Srinagar, the summer capital of Indian-controlled Kashmir, has been unable to deliver on orders. Power cuts lasted up to 20 hours a day, and Ahmad has incurred huge losses. As have hundreds of others in State Industrial Development Corporation parks.

"Not only are we unable to deliver the orders on time to our clients, now we are not able to get new orders," rues Ahmad. "This scenario has crippled my business and I have to pay the salary of staff from my own pocket."


Every time the power supply is interrupted, the machines fall silent in the industrial parks. The outages are triggering demonstrations against the government. Srinagar saw street protests led by women and trade bodies demanding restoration of the power supply.

"Unscheduled power cuts are the death knell to industrial units," Muhammad Muzafar Ahangar, president of a local industrial association, told Xinhua. "I have taken up the matter with authorities several times but unfortunately, they are not giving satisfactory answers."

And it is not just in the north of the country, hundreds of millions of people have been without power almost everywhere. About 70 percent of India's electricity is generated by coal. Plants are unable to maintain stocks largely due to a shortage of wagons for shipping coal.

The present crisis has unfolded at a time when power demand has peaked due to a blistering heatwave with average temperatures in northern and central India the highest in 122 years. And the situation is set to worsen during the monsoon when the supplies traditionally run down. Stocks are already said to be critically low in 108 of 173 power plants.

Payment delays across the value chain weigh on the power sector. Even as the stakeholders blame each other, they are unanimous that the payment mechanism needs to be fixed urgently. Power generation companies owe huge amounts of money to the state-run coal companies. They in turn are owed by distribution companies, which, for whatever reason, results in power outages.


State-run Coal India accounting for 80 percent of India's coal output said it had done all it could to increase supply in April. Pralhad Joshi, India's coal minister rebuffed the reports of a shortage, saying supplies were being replenished to the plants on a daily basis.

"Coal India is furthering India's energy security, registering a significant increase in April 2022," said Joshi. "The coal companies are having around 73 million tons of stock at their end. The thermal power plants have about 21.5 million tons."

However, over 1,800 passenger trains have been cancelled to clear the way for coal trains across the country. Railway officials say passenger services will be restored as soon as the situation normalizes.

India's federal power ministry said rising power demand reflected the economic situation. "The government and other stakeholders are working together to ensure unhindered power supply, and efforts at all fronts are being made and measures are being taken for better utilization of various resources." Enditem

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