Vidarbha units exempted from electricity duty

The Maharashtra government has exempted industrial units in Vidarbha and Marathwada from paying electricity duty for five years.

Vidarbha is the power generation centre for Maharashtra. It has a combined installed capacity of 4340 mw out of the 9,000 mw produced in the state.

The Vidarbha industry has been demanding that power tariff for energy consumed in the region be reduced as transmission and distribution losses close to the generating station or load despatch centre are low.

It has been arguing that the high tariff it has been loaded with is a form of cross subsidisation for supply of power to western Maharashtra.

President of Vidarbha Industries Association (VIA), Mohan Agrawal said industries in the region will save a whopping Rs 2,500 crore as electricity duty over the next five years. The credit for bringing this major relief to industry should solely go to the VIA, he said.

"It was at a VIA meeting on December 16 last year that chief minister Sushil Kumar Shinde announced the electricity duty exemption for industrial units in Vidarbha. However, the matter lay in cold storage till March after which we undertook an aggressive follow-up exercise which included several visits to Mumbai. We met every officer and every minister concerned with the subject. Our efforts have been rightfully rewarded," Agrawal said.

The decision was taken at a Cabinet meeting in Mumbai last week. Power-intensive industries in the region will benefit tremendously from the decision, Agrawal said.

Secretary of MIDC Industries Association (MIA), Hingna, D N Gupta said the decision will give a boost to industrialisation in Vidarbha. The relief has been given to existing as well as new industries coming up in the region. Entrepreneurs must take advantage of this incentive and set up their power-oriented units in Vidarbha, he said.

Gupta said the MIA has been taking up this matter vigorously with the concerned government agencies through the Hingna MLA Ramesh Bang for the last more than two months. In its notification issued in March 2004, the MSEB decided to impose electricity duty with effect from April 1, 2004.

The industry bodies also expressed hope that this step would plug the exodus of power intensive units to nearby Chhattisgarh where electricity tariff is not only low, supply is more regular and of better quality.