Coimbatore: The fuel price hike
has come as a severe jolt to the industrial sector as well as farming
community in Coimbatore, which is already reeling under a crisis.
Industrialists say the fuel price hike, coming at a time when they are slowly emerging out of the economic shock from demonetization, would plunge them into deeper trouble.
"The increase will have considerable impact not only on common man but also the textile industry in Tamil Nadu that provides job to over 50 lakh people directly," said South India Mills Association chairman M Senthilkumar. He said the hike is unwarranted when the Centre has announced to implement GST from July 1, 2017.
Senthilkumar said the Tamil Nadu textile industry is already in a disadvantageous position as the spinning sector spends around Rs 6/kg to procure over 95% of raw material from other parts of the country and another Rs 4/kg to sell the yarn to other states.
"VAT hike will have considerable impact on the transport cost of all items as the textile clusters of different value segments are located in different places," he said.
In addition to the transportation, textile units had to operate the diesel power generators to manage the load shedding and tripping, the cost of which is going to go up due to the fuel price rise.
Pump manufacturers in Coimbatore, who are the key players in the sector in the country, are also worried. "Increase of VAT from 27% to 34% for petrol and 21.4% to 25 % for diesel seems to be abnormal hike. The price rise would deal a severe blow to the industrial sector in Tamil Nadu,'' said Kovai Power Driven Pumps and Spares Manufacturers Association president K Maniraj.
He said more than 75% of raw materials for pump making are sourced from various parts of the country. "We have to transport our products to markets in other states as well. We would be forced to hike the cost of pumps because of the overall increase in transportation costs. Unfortunately, we are not at liberty to increase the product cost because of stiff competition," he said.
Farmers who are facing one of the worst droughts said the fuel price rise has come as a double blow. "As common men, the fuel price rise would affect our daily household budget. At the same time, we would be forced to shell out more for commodities like fertilizers and transportation of the agricultural produce,'' said a farmer from Thondamuthur.
Industrialists say the fuel price hike, coming at a time when they are slowly emerging out of the economic shock from demonetization, would plunge them into deeper trouble.
"The increase will have considerable impact not only on common man but also the textile industry in Tamil Nadu that provides job to over 50 lakh people directly," said South India Mills Association chairman M Senthilkumar. He said the hike is unwarranted when the Centre has announced to implement GST from July 1, 2017.
Senthilkumar said the Tamil Nadu textile industry is already in a disadvantageous position as the spinning sector spends around Rs 6/kg to procure over 95% of raw material from other parts of the country and another Rs 4/kg to sell the yarn to other states.
"VAT hike will have considerable impact on the transport cost of all items as the textile clusters of different value segments are located in different places," he said.
In addition to the transportation, textile units had to operate the diesel power generators to manage the load shedding and tripping, the cost of which is going to go up due to the fuel price rise.
Pump manufacturers in Coimbatore, who are the key players in the sector in the country, are also worried. "Increase of VAT from 27% to 34% for petrol and 21.4% to 25 % for diesel seems to be abnormal hike. The price rise would deal a severe blow to the industrial sector in Tamil Nadu,'' said Kovai Power Driven Pumps and Spares Manufacturers Association president K Maniraj.
He said more than 75% of raw materials for pump making are sourced from various parts of the country. "We have to transport our products to markets in other states as well. We would be forced to hike the cost of pumps because of the overall increase in transportation costs. Unfortunately, we are not at liberty to increase the product cost because of stiff competition," he said.
Farmers who are facing one of the worst droughts said the fuel price rise has come as a double blow. "As common men, the fuel price rise would affect our daily household budget. At the same time, we would be forced to shell out more for commodities like fertilizers and transportation of the agricultural produce,'' said a farmer from Thondamuthur.
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