Software exports from Vizag may miss target on power shortage

Software exports from Visakhapatnam, the second largest software exporting city in Andhra Pradesh after Hyderabad, may fall short of its growth target during the current financial year due to the power crisis.

Local software units are facing severe power cuts since the last four months and hence are not in a position to complete their projects. This will lead to a fall in exports, according to Bulusu Murali, past president, Visakhapatnam Information Technology Association.

Last fiscal, local units accounted for about Rs 1,200 crore of software exports and had set a target of Rs 1,500 crore this financial year.

Mahindra Satyam local head K Viswanatham said power shortage was impacting the margins of IT companies. For software units, power cost comes to around 40 per cent, and now these units are forced to use diesel generators, which has increased the power bill by two to three times. As a result, this would impact the bottom line, he added.

Power distribution companies charge Rs 5-6 per unit, while when a diesel generator is used, this cost comes to 15-20 per unit. During peak hours —from 6 pm to 10 pm —, companies need more power, Vishnu Kumar Raju, president, Rushikonda IT Park Association, said.

New companies and entrepreneurs, he said, were not keen on in setting up units in Visakhapatnam because of the power crisis.