Druk Iron and Steel Private Limited and Bhutan Steel Industries Limited have been shut since January this year. In a letter written to the Association of Bhutan Industries (ABI) they claimed this was due to the unavailability of business due to the increase in power tariff.
The Prime Minister Lyonchhen Tshering Tobgay opined that power tariff could not be the sole reason as to why the two factories shut down.
The PM in the meet the press session yesterday said that the power tariff was established in close consultation with the public by the Bhutan Electricity Authority and the government has refrained from interfering as the government is not supposed to interfere.
Lyonchhen said that the industries are blaming the new tariff when the two industries were shut down since January 2014 when the new power tariff was not even in effect. He said he was confused as the industries have shut down since January but nobody has approach the government.
“So what is the reason behind the industries shutting down? It is very easy to blame the new power tariff for everything but there could be management issues, logistic issues, marketing issues, human resources issues, financing issues etc” Lyonchhen said .
He said it would be better if they are honest with the real issues behind closing down. The PM said and there is no denying the fact that some industries are sick but it is unfair to blame all the problems of the industries on the new power tariff.
“I want be very clear, we will and have to look into an affects of power tariff increase on our industries” Lyonchhen said.
Lyonchhen shared that steel is a power intensive industry and power tariff increase will hurt the industries.
Which is why Lyonchhen said that last year the government worked with hydropower contractors and hydropower authorities to see how the government can make Bhutanese steel more attractive over steel imported from India.
Lyonchhen said, “ The government has gone to a great extent in talking with the manufacturers, contractors and hydropower authorities and we made tremendous progress and the companies have benefited immensely. Till now our impression was that they were doing well.”
Lyonchhen said that if industries have shut down exclusively due to the new power tariff the government would sit down with the Bhutan Electricity Authority and see what can be done and Lyonchhen assured that the government would independently see what can be done.