Demonetisation and industrial woes

Meerut’s sports goods industry clean bowled

Several small production units were forced to shut down as they had no cash to pay the labourers. PHOTO: PARVEZ KHAN  

The sports good industry in Meerut, world famous for its quality cricket bats, has taken a major hit since the Centre banned Rs.500 and Rs.1,000 notes.

Demonetisation has cut production by more than half, with manufacturers saying that cash is required at every stage — from procurement of raw material to transportation to labourers' wages.

Big money

Meerut, along with Jalandhar in Punjab, accounts for nearly 75 per cent of total production of the sports goods industry in India, which is pegged at roughly $3.6 billion. The 3,000 manufacturing firms and 130 exporters operating out of the two cities offer employment to over four lakh people.

Leading manufacturers said several small production units had to shut down as they had no cash to pay the labourers.

“Ours is a labour intensive industry. We require cash for most crucial things, like paying the labourers. Right now, we do not have sufficient cash to pay the workers,” said B. D. Mahajan of B.D. Mahajan Sons and Private Limited, which makes cricket goods.

Village units hit

“The Centre’s diktat over withdrawing cash from one’s own account has made sure that most of the small manufacturing units functioning from villages shut down. The big manufacturers are able to survive, but the future does not look good,” added Mr. Mahajan.

The cash crunch has also hit production of cricket balls in 30 villages around Meerut, which alone employ more than 10,000 people.

“Dependent on cash”

“We do not have money to procure raw material like leather and thread. Everything is dependent on cash, which has completely vanished from the market,” said Pradeep Singh from Sarai Qazi village, five km from Meerut.

Mr. Singh’s small manufacturing unit produces 80 balls a day, which goes up to more than 120 when an international series is going on.

Sarai Qazi village has over 10 manufacturing units that produce 1,500 cricket balls a day. It also gives employment to women. The village units have completely stopped due to the cash crunch, throwing life out of gear for thousands of families of daily wage workers.

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Printable version | Nov 28, 2021 3:49:19 AM |

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