Industrial production growth to slip by 35%

India's industrial production growth, which slowed to 5.3 per cent in January, is likely to further come down to around 3.4 per cent between April-July when the country faces maximum power scarcity, industry body, Assocham said.

Industrial production has already slipped by 25 per cent in February-March and captive power stations within the industrial premises are running at half the capacities, as diesel and petrol have turned expensive, Assocham said in its report on 'Fallout of Worsening Summer Power Situation on Industrial Production in April-July 2008'.

"Industrial production suffered heavily in winters of 2007 as power deficit remained within the range of 18-20 percent. Between the month of February and March 2008, the deficit went up to around 25 per cent, causing industrial production to fall steeply," Assocham president Venugopal Dhoot said.

India's industrial production growth came down to 5.3 percent year on year as compared to 11.6 per cent in January

2007. Power deficit in April-July last year stood at 13.4 percent.

While the power supply situation was unlikely to improve because of constraints on the generation side, Indian Inc's

minimum production loss would be at around 35 per cent. The power utilities are unable to meet demand for electricity by industries, which is growing at around 20-25 per cent, the chamber said.

"The states in which power supply to industrial locations would be most hit are Delhi, Uttar Pradesh, Haryana, Madhya Pradesh, Rajasthan, Maharashtra, Andhra Pradesh, Karnataka, Tamil Nadu and Gujarat," Dhoot said.

In the union territory and the nine states mentioned, the captive power plants put up by industrial units are operating

at less than 50 per cent of their capacities on the back of

costlier fuel, Dhoot added.

Maharashtra is facing an acute shortage of power with

energy deficit touching about 20 per cent, Assocham said.While Madhya Pradesh is facing a deficit of around 1,100 MW, the situation is no better in Gujarat, it said. The southern part of the country was likely to suffer energy shortage of 2,000 MW, particularly in Andhra Pradesh, Karnataka and Tamil Nadu.