Textile units for lower power tariffs

Textile processors in the state have sought a reduction in power charges and sales tax on lignite and natural gas.

"The entire textile industry is in the midst of a recession. It is crucial that the government supports the industry now," Ramesh Gajjar, president of the South Gujarat Textile Processors Association said.

"The cost of power, lignite, steam coal and natural gas constitute a major part of the total production cost in the processing sector. Unfortunately for the industry, all these energy sources attract heavy taxes," he said.

"The sales tax applicable on lignite is currently 20 per cent "" which is extremely high by any standards. This should be reduced to the level of the tax on steam coal (four per cent). Similarly, sales tax on natural gas should be lowered from 12 per cent to 4 per cent," he said.

"In the Budget for 2005-06, the state government has proposed a reduction in electricity duty for high tension consumers from 20 to 15 per cent. This relief is insufficient in the present circumstances. Further, it would be negated by the electricity fuel adjustment charges at the end of the year," he said.

"The electricity duty for high tension consumers should be reduced to 10 per cent," he added.

"We have met finance minister Vaju Vala two days back in Gandhinagar, and apprised him of the situation. The minister has assured us that he will consider our demands sympathetically," Gajjar added.

The association vice-president Jitu Vakharia, said: "The sales tax on lignite and natural gas should be reduced considerably. This has been our long-standing demand."

There are around 400 processing units in Surat. The sector is caught in severe recession for last few months, with most processing units operating at 40 to 50 per cent capacity.