The three major issues that have plagued industries in Kutch are inadequate supply of water, higher transportation cost of lignite, and excise and tax cuts by the UPA government. The major industries in the region are steel, ceramic and cement.

Federation of Kutch Industries (FOKIA) said industries will be wiped out if the governments, both Central and state, do not work out a solution to these problems.

“Water shortage is the most burning issue. The Sardar Sarovar Project water that reaches us is inadequate because of illegal lifting. Most of the industries like vitrified tiles, cement and steel need water in large quantities,” said Nimish Phadke, the president of FOKIA.

The industry needs around 300 MLD (million litres per day) of water, but they get only 50 MLD. FOKIA has also made several representations to the state government on this. “The planned desalination plant has still not seen light of the day. I don’t know when it will materialise,” said Phadke.

Besides, the state government has curtailed the supply of lignite from the Pandhro site for other industries.

“Till last year, industries were supplied high quality lignite from the Pandhro site, which is owned by the Gujarat Mineral Development Corporation. But now, we are forced to transport it from other places like Surat and Bhavnagar. This has hampered the quality of lignite,” Phadke added.

Excise and duty cuts announced by the Central government as part of the third stimulus package, is a major reason for the ill-health of industries in Kutch.

The goods produced in other parts of the state have now become more competitive and even cheaper as compared to Kutch units due to lower transport and establishment cost and lower excise duty of eight per cent.

“It doesn’t make any difference to be in Kutch since the establishment cost here is higher,” Phadke added.