Due to the market slowdown, industries in and around Jamshedpur- specifically in Adityapur Industrial Area (AIA) housing auto ancillaries are facing a tough time with series of block closures in Tata Motors from the past month. It has gone so far that while about 30 steel sector companies were on the verge of closing down, about a dozen downed their shutters from Thursday.
As the automobile sector has been hit with the recession, since one month Tata Motors has gone for block closure for the fourth time, this time from Thursday to Saturday along with Sunday being a holiday. The company has also opted for separation of 12 days (asked to sit in the house) for over 1000 temporary (Y-6) workers. While permanent employees will join back their duty on August 5, Y-6 workers have been asked to rejoin from August 12, 2019.
The sluggish market demands have led Tata Motors to take a series of block closures. For the last two months, there was production for only 15 days per month. According to the union sources, the company has orders for only a week’s production in August which has resulted in limited work in about 1000 auto-ancillaries which are dependent on Tata Motors in AIA.
On the other hand, the intense power tariff hike has hit the steel sectors with induction furnaces where electricity is an essential raw material which has resulted in the closure of about 30 companies. This in fact has led over a dozen such companies to down shutters from Thursday.
President, Aditaypur Small Industries Association (ASIA)’Recession, Inder Agrawal said today, “ In auto-sector is nothing new…It comes every two-three years. I met Tata Motors Plant Head today who said that the company might have to take another block closure of 3-4 days after which things would normalise. We expect things to be back on track after September. The company has got 40% less orders for its vehicles this July compared to the corresponding month last year. Some of our companies are working in a limited capacity while some have opted for maintenance work.”
Laghu Udyog Bharti (LUB) president Rupesh Katiyar said that about 1000 companies in Jamshedpur, Adityapur, and Dhalbhumgarh were affected with the recession and power tariff hike, rendering over 30, 000 direct and indirect workers jobless.
He said, “We demand the government to waive off the fixed charge for power or cut down the tariff hike and request the banks to support the industries at this hour of crisis. If we fail to pay loan installments for three months, our accounts will turn NPA. How will we pay a loan when we don’t have money to pay a salary to our workers?”
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