The Consortium of Puducherry Industries Association has urged the Centre to take measures to arrest the increase in price of raw materials.
Secretary of the association M. Nandakumar in a press release, said Micro Small and Medium Enterprises have been suffering due to the impact of COVID-19. Now, the rise in raw material price has hit the industry badly. The increase in price of raw materials had led to the cancellation of orders, uncertainty of consumption in the market and decline in exports.
The price of steel and other foundry products such as coke, pig iron, cast iron, copper, brass, aluminium and steel scrap have increased by 30 % to 40 % in the last few months. There was also shortage of certain raw materials, he said in the release.
The impact of a rise in the price of raw materials on the overall cost of products was about 20%. Consequently, the working capital requirement had increased, and more capital was required to cope with the situation. The MSME sector would “cease to exist” if the Ministry of Finance failed to look into the current rise in price of raw materials, the release said.
The Centre should stop imposing barriers such as anti-dumping and mandatory BIS standard, as demand for several polymers exceed domestic demand. The government should also consider an immediate ban on export of raw materials to ease domestic supply and check price rise, the release said.
