SIVAKASI WEATHER
Fireworks hub loses 35 per cent of market share to Chinese imports, defuse Sivakasi cracker business

27-10-2016
27th October 2016

- The Economic Times

Fireworks hub loses 35 per cent of market share to Chinese imports, defuse Sivakasi cracker business

Sundar Mahalingam is panicking. The Sivakasi-based firecracker manufacturer has been in the business for almost 25 years. But he says he hasnt seen a lull like this ever before.

“The business is extremely low this year. I fear a 50 per cent loss. People are leaving this job, families are migrating from Sivakasi. Many are unable to repay the loan they took for business,“ he says.

There was a time when Sivakasi, the fireworks hub of India, used to cater to 90 per cent of fireworks demand of the country . With almost two lakh people dependent on them, over 600 factories function here producing over 300 varieties of firecrackers.

However, times have changed and manufacturers are going through the biggest crisis so far ­ a 35 per cent loss in market share, the highest ­ and this damage is attributed to the illegal Chinese fireworks smuggled into the market.

Possession and sale of foreign fireworks is illegal in India as Petroleum & Explosives Safety Organisation (PESO), which comes under Ministry of Commerce and Industry , hasnt granted licence for import of the same.

Domestic manufacturers claim that the Chinese crackers contain hazardous chemicals and can ignite or explode spontaneously .

According to government data, in the year 2015-16 (up to October, 2015), approximately 315 tonnes of firecrackers were seized. DRI recently seized Chinese firecrackers worth Rs 9 crore in New Delhi following another seizure in Mumbai worth Rs 7.2 crore in August.

“We have destroyed almost 94 tonnes of illegal firecrackers so far. Those seized at ports like Bombay have been destroyed, while those at ports like Chennai are awaiting clearance for destruction from the respective authorities,“ said an official who didnt want to be named.

However, Sivakasi manufacturers estimate the figure to be much higher. “Around 2,000 containers of Chinese crackers worth Rs 1,500 crore are 4,000 still operating in the crore Indian market.

This cost us a 35 per cent loss in market share, the highest loss so far. These are being smuggled in through ports like Kandla, Mumbai, Tuticorin, Chennai and Kolkatta, and escape seizure due to the lack of advanced scanning machines and adequate personnel at ports and lack of proper checks inland, to search or seize the contraband,“ said K Mariappan, general secretary of the Tamil Nadu Fireworks and Amorces Manufacturers Association (TANFAMA).

According to him, the smuggled items include hazardous chlorates which are cheaper than the Indian crackers which contain nitrates and metal powders.


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