Maharashtra cuts power tariff for looms to Rs 1/hp

The Maharashtra state cabinet steeply cut the power tariff for the powerloom sector to Re 1 per horse power (hp) from Rs 250 per hp yesterday.

The move is part of a slew of incentives announced for powerloom owners, which include rescheduling of loans taken to purchase machinery or to meet working capital requirements.

Maharashtra chief minister Sushilkumar Shinde said: "Currently powerloom owners pay a power tariff of Rs 250 per horse power (hp), which has been reduced to Re 1 per hp. Similarly, sick powerlooms currently under proceedings by banks for the recovery of various loans would be permitted to reschedule these loans. Of the net payable amount (rescheduled loans), the state government will pay 50 per cent in addition to five per cent of the interest on the remaining amount for the next five years. Such powerloom units would also continue to be eligible for incentives announced by the industry department on April 21, 2001, for sick powerloom units."

The state's powerloom sector, which is based mostly in Sholapur, Bhiwandi, Melegaon and Ichalkaranji and Nagpur, boast of over 9.2 lakh powerlooms that employ more than 15 lakh persons directly or indirectly.

Shinde also announced that the state government will bear five per cent of the interest payable on loans taken for setting up powerlooms fro April 2001 to 2005.

"This offer is much better than the scheme launched for the powerloom industry by the Union government," he added.

The scheme would cover ordinary, semi-automatic, automatic, shutterless, jekard and teri-towel powerloom as well as the loans taken earlier by the industry for importing machines as well as meeting their working capital requirements.

The incentives will be available to textile units having up to Rs one crore of equity capital.

"Similarly, there is no delimitation for powerloom units set up outside industrial zones created for the sector. Even those units operating in residential or commercial zones would be eligible for these incentives. The new package also confers all the incentives available for industries set up in D+ (most backward regions in Maharashtra) to the powerloom segment," Shinde added.