Business

Bhiwandi Reeling Under Crippling Blow Struck By Demonetisation

The government's move to ban high value denomination notes has resulted in major casualties for the small scale industries across the nation.

As you might be thinking about remote rural locations, in the backyard of Mumbai, some 20 km away, the powerloom hub of Bhiwandi have a sad story say because of slowdown.

Needless to say the mill owners unanimously chorused that there is a slowdown in business with fewer orders pouring in because of the cash crunch created by the demonetisation. There is a monumental slow down in business resulting from fewer numbers of orders. The cash crunch is thwarting the owners and workers from finishing the limited work they have. "There are over 1.2 million power looms in Bhiwandi. Nearly 70 per cent of them have downed their shutters. The remaining few will shortly follow suit," opined Abdul Mannan Siddiqui, a powerloom owner and president of the industry body Shantinagar Power looms Association.

The Bhiwandi power looms were beset by problems because of high electricity tariff and China dumping their goods in India. The demonetization exercise proved to be the last nail in the proverbial coffin for the power loom owners and employees.

Power loom employees are running from pillar to post for new jobs as they had to quit their old jobs after their units shutdown. "We were earning close to Rs.10,000 and now we are left with no income," they chorused.

A power loom owner disclosed that he was forced to shut down the mill due to lack of cash and inability to buy raw material. Another weaving shed owner confided that due to his inability to pay the 20 workers he had employed he was forced to shut shop. Most of the workers have returned to their home towns. "If things don't pick up any time soon, I will have no options but sell my looms as scrap," he added. Some of the owners like Hayat Khan even said that the situation was worse than what happened in 1999-2000 because of a slump in business.

According to Purushottam Vanga, Vice Chairman Powerloom Development & Export Promotion Council, "Nearly 80% workforce in Bhiwandi are immigrants and half of them have returned to their homes in their native villages”.

Union Textiles Minister Smriti Irani visited the township recently and promised relief measures promptly. The focus is now on opening bank accounts for employees in the power loom sector and ministry has deployed manpower though Textile Commissioner's office for the job.