India’s intervention to water down the language of the Glasgow Climate Pact with respect to ‘phasing down’ coal may not contribute to stem decline of thermal power equipment manufacturers, lament anxious proprietors of the drastically declining number of ancillary industries that had been highly dependent on the public sector major, BHEL, for survival.
Coal has been referred to as the dirtiest fossil fuel by the International Energy Agency, which advocates a rapid phase-out for the world to staying within 1.5C of global heating.
This implies that at least 40% of the world’s existing 8,500 coal-fired power plants must be closed by 2030 and no new ones built, much to the detriment of the coal-fired power plants and power equipment manufacturers in India.
Though it was at India’s insistence that ‘phasing out’ coal was replaced with ‘phasing down’, the ancillary industries are doubtful about the future of the thermal power sector, and are keen on BHEL’s diversification for sustenance in the long run.
Proprietors of ancillary industries in Tiruchi region say there was much anticipation on some forward movement in the move made by BHEL Tiruchi to manufacture electric buses.
The Container Corporation (CONCOR), a railways subsidiary, has placed work order for manufacture of 2,000 containers with BHEL and Braithwaite and Co. Likewise, the BHEL must also make the most of the proposed Defence Industrial Corridor in Tamil Nadu, with Tiruchi as one of the five nodes, a promoter of an ancillary unit emphasised.
According to BHEL sources, the Corporation is hopeful of progress in the move by the Central Government to renovate ageing thermal power stations. The Central Electrical Authority came out with guidelines last year for renovation and modernisation/ life extension works of coal/lignite-based thermal stations.
The ancillary industries have not entirely lost hopes for survival since the country cannot entirely depend on renewable power for sustaining the economy for at least a decade.
“For the ancillary industries, the challenges have grown bigger, due to the rapid rise in the cost of inputs and labour. The necessity to quote low for conversion works due to the competition has pushed many units into the red,” S. Sampath, Director, Velmurugan Industries Private Limited, and former Chairman, CII, Tiruchi Zone, said.
“But then, the onus is on the units to devise ways for survival through cost-cutting and disruptive approaches. Modernisation and innovation ought to be the watchwords. Only those focussing on efficiency on employees, material control, and bottom line financial management will be able to survive. Modernisation does not necessarily mean investing more,” Mr. Sampath said.
