Small and tiny foundries here will go on two-day strike demanding government support to bring down raw material prices.
President of Coimbatore Tiny Small Foundry Owners’ Association Siva Shanmugakumar said nearly 400 small and tiny foundries will down shutters on April 20 and 21 as prices of pig iron, scrap, and coke have increased 20 % in the last three months.
The small foundries buy raw materials in low quantities from local dealers. They function out of two clusters - Arasur and Manikampalayam. “We want raw material banks at the two clusters so that we can buy the required material as retail purchase,” he said.
With profit margins shrinking to less than 5 %, banks should rework on the loan repayment period for the tiny foundries. It should be extended to 15 years from the existing seven years. Earlier, foundries with less than ₹1.5 crore annual turnover were exempted from Excise Duty. Now, all foundries are under GST. Hence, customers prefer giving orders to the bigger units and this has hit demand for the small and tiny foundries, he said.
These units have a total turnover of ₹2,000 crore a year and employ two lakh people directly.
Seeking steps from the Union and State Governments to bring down the raw material prices for foundries, the Coimbatore Tirupur District Micro and Cottage Entrepreneurs Association has extended support to the two-day strike.
