Raipur: The state steel industry has recently faced a sharp electricity tariff hike; this has pegged the cost of iron in Chhattisgarh much higher. Due to this sudden hike in the power tariffs, the Chhattisgarh Mini Steel Plant Association has formally demanded the State Government to provide a subsidy of ₹1.40 per unit for the next five years and the boundless removal of the 8% electricity duty for a period of fifteen years. This measure is intended to reduce the burden on the industry’s finances and return its competitiveness.
Steel Industry Demands
Belonging to the Chhattisgarh Mini Steel Plant Association, the secretary, Manish Dhupad, said there are nearly 600 steel industries in the state that make significant power purchases from the Chhattisgarh State Power Distribution Company. These industries use around 1100 crore units of electric supply every year and earn around Rs. 7700 crore every year from the electricity supply company. But apart from using electricity, the iron industry pays over ₹9000 crore GST to both the state and the center implying its economic contribution.
The steel industry also offers direct employment and indirect employment to about 2.5 to 3 lakh families depend on this industry, which is a key stakeholder in the local economy. Mini steel plants consist of 105 sponge iron and 220 rolling mills; such plants are integral to the procedural link in steel-producing processes.
In this regard, steel producers in other big steel production states enjoy slightly lower costs of electricity. For example, Odisha set ₹5.13 per unit, Jindal Park Raigarh ₹5.00 per unit, Punjab cost upto ₹5.44 per unit, and the Damodar Valley in West Bengal ₹ 5.99 per unit. This has increased electricity costs, which directly impacts increasing production costs in Chhattisgarh’s steel industry, thus making their products expensive to other steels originating from other states.
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