Railway freight hike, poor connectivity: Coimbatore industry fights for survival | SupportBiz

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Railway freight hike, poor connectivity: Coimbatore industry fights for survival

At a time of lingering economic and revenue uncertainty, small scale industries are fighting that crucial battle of survival and the best thing they could hope for is a friendly government intervention.

However, their hopes of revival were burst like soap bubbles in the rain when the government said it plans to increase the railway freight rates by 15 percent. The decision adds to the industrial city’s poor connectivity woes.

Coimbatore’s SME industry leaders have been quite vocal about the proposed freight rate hike fearing the enactment of this proposal would price them out of competition.  Talking to SupportBiz, N. Visvanathan, President - Coimbatore Industrial Infrastructure Association (COINDIA), said the issue creates an alarming situation for SMEs in the region. “We are making all our efforts to persuade the central government to roll back the decision. COINDIA will join with other leading associations to represent the industry’s feelings and request them to take a relook at it. We are also taking necessary initiatives to minimize the damage the hike can cause to the units here.”

J.James, Coimbatore District President of Tamil Nadu Association of Cottage and Micro Enterprises (TACT) feels the freight charge hike will further weaken the industry which is already at a bad shape due to the ever increasing fuel prices. “Basically the raw materials for various production activities are purchased from north India. So, we have to pay the 15 percent tax as we bring the raw material to the state and we will have to pay another 15 percent as we send the finished products back to other parts of the country. We stand to incur a hefty tax bill (30 percent) in the process and this will drag the industry to further lose. This is a huge issue for both the manufactures as well as the consumers,” he said. “We have taken the issue with the central railway minister, gave statements to the local media and we demand an immediate recall of the decision,” said a visibly upset James.

On the other hand, an expanded international airport has been a major, long-pending demand on which the industry pins all its hopes for a better connectivity. Despite being a key industrial city in the region, Coimbatore’s requests for a better air connectivity has long been ignored. “We have been requesting the state and central government for this for a long time now. We demand the authorities to fast-track the activities such as increasing the length of the runway, acquisition of land and developing a bigger parking area. Land acquisition is the major problem here. The government’s apathy is affecting the industry badly. We are sure that the business activities will accelerate with an international airport,” Visvanathan said.

James said the industry is united in its demand for an international airport in Coimbatore because their foreign clients have severe complaints about the poor connectivity to the city. “The land value has grown up like never before. The government is not ready to pay the land owners the market price,” he said. “We want the airport to be expanded, provide us the opportunities to reach out to the world. The government has to take some immediate decisions.”