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Chhattisgarh CM says 80% industrial production back on track but industrialists contest claim

Chhattisgarh allowed industries to resume operations on 22 April. Industrialists in the state say 80% production can’t happen so soon.

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Raipur: Chhattisgarh Chief Minister Bhupesh Baghel’s claim that despite the lockdown, almost 80 per cent of the total industrial production of the state is “back on track” has been questioned by several industrialists.

The state allowed industries to resume operations just 11 days ago, on 22 April.

According to industrialists in the state, they have been allowed to operate with 50 per cent workforce because of which production is currently being done in only 50-60 per cent small and medium-scale units.

Due to this, it might take at least 6 months to normalise the situation, they said.

In Chhattisgarh, the key industries are steal, coal, power, cement, aluminium and mining. The industrial sector contributes 40 per cent to the state’s GDP, which is projected to be Rs 3.62 lakh crore for 2020-21 financial year.

On 28 April, Baghel, in a meeting with some industrialists and industrial organisations via video conference, had said: “As of now, around 80 per cent of the industrial production is back on track and in the coming days, these industries will soon start generating 100 per cent production.” 

The chief minister had also told the industrialists that in view of labour shortage, especially migrant labourers, they should employ local workers so that they get some additional employment and through this, the spread of Covid-19 infection could also be restricted to the state.

In the meeting, Baghel had also claimed that migrant labourers working in Chhattisgarh did not face major inconvenience due to the lockdown as factory owners had provided them with food and shelter.

“It was quite different from other states where abrupt shutdown of industries had created an atmosphere of chaos and scores of workers hit the streets demanding immediate return to their native states,” the chief minister had said.

However, more than 60 per cent of the migrant labourers have returned to their native states so far since the lockdown, which came into effect on 25 March, said Ashwin Garg, president of the state’s largest industrial zone, Urla Industries Association.

Also read: ‘100 Hindus’, said to be in Chhattisgarh Tablighi isolation list, complain of social boycott

‘Production meagre as demand is almost negligible’

Industrialists pointed out that it’s not possible to have 80 per cent production so soon because even after lockdown is lifted, there will be a host of other problems — availability of raw materials, arranging labourers, transportation and finding markets for the produced goods — which can’t be fixed at one go. It will take time to make everything fall in place, they added.

According to industry owners, only 50-60 per cent of MSME (micro, small and medium enterprises) units have been able to begin production so far. 

A large number of steel industries have been able to work at only 25-30 per cent of their full capacity. Even in these units only maintenance work is being carried out in the name of production.

Garg, who is also an industrialist, said: “Only 50-60 per cent of the total MSMEs across the state have been able to start their operations.”

“In most of these units, production work has to be done in the presence of less than half the workers. About 80 per cent of heavy industries like cement, iron-ore based units, steel and power companies — that constitute around 50 per cent of the state’s industrial operation — have become functional,” added Garg.

But their production is very meagre because the demand in the market is still “almost negligible”, said Garg.

He also said the return of large-scale industrial production in the state to its full capacity could be seen only after at least six months.

‘Real test for industries will start after lockdown’

Representatives of industry associations said that a large chunk of the raw materials required for industrial production comes from outside the state. 

Despite permission for inter-state transport granted by the central government for its transportation, there will be serious problems after the lockdown is lifted.

“The real test for industries will start only after lifting the lockdown. There would be major trouble in arranging for transportation of both raw materials and produced goods post lockdown because most of the drivers of all transport companies have gone back to their home states and now only 30 per cent freight vehicles can hit the road so soon,” Garg said.

Manoj Tapadia, president of Chhattisgarh Federation of Industries, said normalisation of industrial production would not take place in less than 15 days or even a month.

“Problems like availability of market, recalling the workers on duty, payment to labourers and transportation of goods will be there. Restoration of the previous scale of production is not going to take place in 15 days or even in a month. Most of the workers have gone back to their native villages and now they are unlikely to come back soon,” he added.

Big markets in red zones or in hotspots

Garg and Tapadia both said that states like Maharashtra, Delhi, Gujarat, Haryana, Punjab, Tamil Nadu are the major markets for products manufactured in Chhattisgarh. 

But major cities in all these states have now turned into Covid-19 hotspots and due to this, the markets for our products are still completely inaccessible, said Garg.

According to Tapadia, demand in the last 4-5 days has come only from local markets that remain open for 4-5 hours in the morning. 

“As of now, the stock remaining with the producers is being consumed. Demand from larger markets has not yet come, so large-scale production is yet to start,” he added.

Chief Minister Baghel on 28 April had said industrialists should reach out to markets in the green zones to supply their goods.

“The state government will extend all the necessary cooperation in this regard. If required, the issue will be further discussed with the chief ministers and senior officials of other states in order to make suitable arrangements,” he had said.

Also read: India lost more jobs due to coronavirus lockdown than US did during Depression


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