The maharashtra state government on 10-12-2014 withdrew its decision to discontinue the Rs 706-crore subsidy component to the domestic, industries, agriculture pumps and commercial establishments in the state. The state cabinet, through a government resolution ,has decided to allocate Rs 706 crore for the 2014-15 financial year to the industries.
Ichalkaranji-based member of legislative assembly Suresh Halvankar, who is also heading the review committee for textile business, pursued the issue with the state government. At a late-night meeting with the state chief minister, industries minister and textile minister along with the secretaries of the respective ministries, Halvankar lobbied for the necessity of continuation of the subsidy for the textile and other industries in the state. Halvankar is in Nagpur for the ongoing winter session of the assembly.
Speaking to TOI, he said, "It is true that the textile sector was bleeding in the last three years because input costs such as labour salaries, machine prices and maintenance was going up. The discontinuation of subsidy component would mean more expenditure on power bills. The textile units would have been forced to pass it on to customers. To avoid the cascading effect which would lead into social unrest, we have decided to make financial provision for the subsidy."
The GR states that Rs 706 crore are going to be disabused to the state power distribution company either from February or from the date sanctioned by the Maharashtra Electricity Regulatory Commission.
For this, the state government had made an allocation of 10,500 crore for the 2014-15 fiscal in the upcoming budget. Out of which, Rs 7,543 crore have already been disbursed to the state power distribution company.
The GR has also mentioned that the state government should issue a separate demand draft in the name of Maharashtra State Electricity Distribution Company Ltd for the disbursement of the subsidy.
The earlier state cabinet had decided to allocate Rs 706 crore subsidy component, which would borne the hiked power tariffs by Maharashtra State Electricity Distribution Company Ltd. The Maharashtra state is largely dependent thermal power than hydroelectric. As a result, the power tariffs in the state are to be hiked frequently than the other states. The share of renewable energy is also very low in the state's power sector.
Karnataka, Andhra Pradesh and Gujarat states have a large share of hydroelectric power, where the dams provide electricity. Unlike thermal sector where coal has to be transported from the source to power plants, water accumulates in the dams during seasonal rain.