MP: Factories in Mandideep Incurring Losses of over Rs 200 Crore Daily

Bhopal: Mandideep Industrial Area, about 20 kilometres away from the state capital, is home to 755 factories which are incurring losses of between Rs 200 to Rs 250 crore on a daily basis due to the COVID-19 lockdown.

“If the lockdown continues for long, many industries will be forced to shut down,” said D.K. Jain, chairman of Mandideep Industries Association.

A sum of Rs 34,000 crore had been invested in the industrial town where items worth Rs 25,000 crore are manufactured every year. The lockdown is not only affecting manufacturing units and businesses, but also transport, daily-wage labourers and other sectors which are in direct or indirect association.

Set up in the early 1980s, the town now sees itself falling prey to a lockdown which has hit over 750 factories. It has also hit imports of raw material and prevented factories from exporting their products. It is for the first time here that factories have been locked down for so long.

The industrial township is officially home to 755 small, medium and large industries and major companies like Mahindra Group, Crompton Greaves and Procter & Gamble have their factories here. After the slowdown, between 20% and 30% factories have shut down.

The area mainly produces items including textiles, electric equipment, wires and cables, automobile parts and medicines and products worth Rs 6,000 crore are exported to 180 countries across the world from here. More than 30,000 people’s livelihoods rest on the town.

According to factory owners the situation was not as bad even in 1992, when the Babri Masjid was demolished.

Commenting on the situation, chairman of AIM Rajeev Agarwal told NewsClick that all operations are closed except pharmaceuticals and some food-processing units. “If the lockdown is extended, the situation would be alarming for the industry,” he added.

Factories manufacturing auto, pharmaceutical, power, cotton and electronic products would be affected, as they are not getting raw material and manufactured items are lying unsold, he said.

Workers Worst Affected

Close to 30,000 people work in the Mandideep Industrial area with the average worker receiving between Rs 8,000 to Rs 15,000 a month. Some factories have provided them shelter and some workers live on rent. However, there are thousands of daily-wage labourers who work for contractors. They are bearing the brunt of the lockdown and hardly managing to make ends meet.

NewsClick spoke to some workers who have been working in different factories. They haven’t received their salary for last month. While some factories have assured them that they wouldn’t cut salaries, many owners kept mum, they claimed.

“Some of them have received Rs 1,000 and three months advance ration distributed by the State Government in view of the lockdown, while many haven’t,” claimed Balwant Dangi, member of a labour union.

On March 30, Madhya Pradesh CM Shivraj Singh Chouhan claimed that the state government had transferred Rs 88.50 crore to the accounts of 8.85 lakh labourers in order for them to tide over the period.

Ramayan Dwivedi works at a garment factory and earns about Rs 8,000 a month. “I pay Rs 2,500 as rent and a similar amount goes towards my daughters’ education and transportation expenses. We somehow manage with the money. If the company cuts my salary, it would be difficult to even survive,” he said.

Dwivedi’s company transfers his salary on the 7th day of every month. Just like him, more than 2,000 factory workers wait for their salary.

Pramod Singh, who works as a labourer, faces a similar ordeal with a family of four to look after. “These are really difficult times. I somehow manged to earn extra through other work, but, due to the lockdown, we can’t step outside of our home. The Government’s aid of Rs 1,000 and three months ration is saving our lives else we would die out of hanger,” he said.

Pramod is also associated with a trade union and claimed that many companies which were running in debt have not paid between two and three months’ salary. “A tire manufacturing company, which has a work force of around 1000 workers hasn’t paid two months salary to their employees,” he claimed.

Upendra Tiwari, who works in a textile factory claimed: “Workers of my factory are primarily women or young girls. The company has made good arrangements for them. But the condition of daily wagers is scary. The contractor has not paid wages for three to four days. Some of them managed run away to their homes while some are stranded. A dozens of them live in a single room and depend on the community kitchen which serves food,” he said.

Just like Mandideep, Pritampura, the biggest industrial zone of Madhya Pradesh close to Indore, which has reported 75 cases till date, is entirely shut.

Madhya Pradesh has around a dozen industrial areas across the state and the condition is  similar in every special economic zone. Factories are closed, wages unpaid while stranded labourers are running out of food.