Wage, war, post-COVID impact kill Ranipet units

RANIPET: Industries in Ranipet are affected badly due to the the Russia-Ukraine war, recession in Europe, and after-effects of the COVID pandemic couple with the increase in minimum wages.

“While leather units and shoe companies are functioning at just one-third of their capacity, their support units in Ranipet, which were doing job works, have shut shop due to lack of orders,” an entrepreneur said on condition of anonymity.

While the lack of orders has resulted in many ancillary units dependent on BHEL downing shutters over the last three years, the problem has now affected other units also in the town.

“Foreign buyers are not placing fresh orders as stocks are not moving out of their godowns,” an entrepreneur said.

“If at all there will be a turn-around, it may happen only in September and till then we have to grin and bear it,” he added.

Two local factors that are affecting industry at present are the revision of minimum wages to Rs 9,200 plus perks per person, per month and the recent hike in LT charges by the state government.

Both these have turned out to be a major burden on the units which have forced increase in production costs resulting in two major foreign buyers moving to South Korea and Vietnam, a source added.

As far as the hike in LT charge is concerned, earlier the charge was Rs 50 per KVA and now it is being increased and is also in three slabs with the highest amount being Rs 500 per KVA. This resulted in most units giving up excess power which was not utilised.

However, though the move to reduce the power needs involves only paperwork, Tangedco officials at Ranipet refuse to do the needful and pass on the buck.

“The entrepreneur is forced to meet and ‘impress’ the Tangedco higher-ups to discuss,” an affected entrepreneur revealed.

A local issue that is affecting industry at present is the revision of minimum wages to Rs 9,200 plus perks