Question

Power sector reforms in many Indian states led to do away with the supply of electricity at subsidised rates and steep rise in power tariff. This has affected workers engaged in small industries. Powerloom textile industry in Andhra Pradesh is an example. Since the wages of the powerloom workers are linked to the production of cloth, power cut means cut in wages of weavers, who were already suffering from hike in tariff. A few years ago, this led to a crisis in the livelihood of the weavers, and 50 powerloom workers committed suicide in a small town called ‘Siricilla’ in Andhra Pradesh.

1. Do you think the power tariff should not be raised?
2. What would be your suggestions to revive small industries affected by reforms?

Answer 1

1. Power tariffs should not be increased suddenly or excessively, especially for small-scale industries and low-income users. A steep rise in electricity charges increases production costs and can reduce the income of workers and small producers. However, tariffs may sometimes need revision to cover the cost of supplying electricity. In such cases, the increase should be gradual and reasonable, and special concessions or subsidies should be provided to vulnerable groups and small industries.
   Conclusion: Power tariffs should be revised carefully so that the power sector remains financially viable without harming small producers and workers.

2. Small industries affected by reforms can be supported through: 
   • Subsidised or reasonably priced electricity.
   • Easy and low-interest credit.
   • Support for modern machinery and technology.
   • Training and skill development for workers.
   • Better marketing facilities.
   • Protection from sudden increases in input costs.
   • Financial assistance during periods of crisis.
   • Government support for traditional industries such as handloom and powerloom.
     Conclusion: Small industries should be helped to become more efficient and competitive, but reforms should not place an unbearable burden on workers and small producers.