Irked over delay in VAT refunds, hike in electricity and fuel charges, several industrialists of the city have warned the state government that they would flee the state due to losses being incurred by them.
The industry was already infuriated over frequent power cuts during summers, and the state government's recent decision to impose cess on power has added to their woes. Some of the major industrial units have already shifted to other states like Bihar and Uttar Pradesh due to lucrative offers regarding taxes and electricity they get in such states. Many other industries have also opened up their units in these states and have reduced production of goods in Ludhiana.
The industry leaders have been accusing for long the state government of not keeping sympathy with even those units that were facing severe problems in production due to high cost of electricity.
Janata Nagar Small Scale Manufacturers Association president Jaswinder Singh Thukral said many small industrial units have shut their operations due to excessive taxes and high electricity tariff in the state. "I think most of the industries would leave the state to go and settle in other states including Himachal Pradesh where the government offers several incentives to industrial units,"said Thukral.
"It seems that Punjab government is least interested in retaining the industrial units in Ludhiana as well as other parts of the state. That's why they are not providing any relief to the industry,"said Thukral.
While the increase in electricity tariff in 2010-11 was 7.58 per cent, it increased to 9.19 per cent in 2011-12. The rate further increased to 12.08% in 2012-13 but dipped to 2.74% in 2013-15. Punjab State Electricity Regulatory Commission (PSERC) is responsible for changes in electricity tariff in the state.
Gurmeet Kular, president of Federation of Industrial and Commercial Organization (FICO), said the furnace and re-rolling industry is worst hit due to hike in electricity rates. "The recent duty on electricity has put further burden on the industry that has already been facing recession,"said Kular.