A severe power shortage has forced India''s largest iron-ore producing region to cut supply to industries once a week, which will cut output and affect cargo loading at Paradip, a key port for oil imports.
Officials said they feared the power cuts could last through June in the eastern state of Orissa, which is home to India's largest iron ore reserves, as well as major steelworks and the Paradip port.
The water levels in Orissa''s reservoirs have fallen sharply as last year''s monsoon rains were the worst since 1972, cutting hydropower generation to 300-400 megawatts from 2,085 megawatts, a government official said.
"If they cut power supply for a full day (once in a week) certainly it will affect port operation" Paradip Port's deputy chairman Biplav Kumar said.
Economists say old infrastructure and chronic power shortages are one of the biggest hindrances to economic growth.
The Paradip port, a major hub, exported 14 million tonnes of iron ore in 200809. The port also handles crude oil and refined petroleum products, as well as coal imports.
Orissa's aluminium sector is unlikely to be affected as most facilities have their own power generation capacity.
The Central Electricity Supply Utility of Orissa (CESU), a leading power distribution utility, published a schedule for power cuts for various districts in local newspapers.
Officials said power cuts, which began on Tuesday, may continue until June.
"It is a temporary phenomenon. We hope the situation will improve soon. But if the crisis continues, the cuts may go on till May-June," Orissa''s Energy Secretary P.K. Jena told Reuters.
The decision to start power cuts on Tuesday prompted widespread concern among regional firms.
"Power is a basic input for every industry. It is going to adversely affect companies," SS Nandurdikar, managing director of Paradeep Phosphate Limited aid.s
The state has over a quarter of India's iron ore reserves and half of the country''s bauxite reserves, and is home to several steel and mineral based process industries.
"It will have very severe implications" R.K Jena, Vice-Chairman of Confederation of Indian industries (CII) Orissa state council said.
"Small and medium process industries including steel, ferroalloys and (secondary) aluminium etc would be affected. There could be a monthly production loss of 15 to 20 per cent," he said.
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