Falling exports, rising costs push granite industry into deep crisis

Falling exports, rising costs push granite industry into deep crisis
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Minister Balineni Srinivasa Reddy discussing the issues of granite polishing and cutting industries owners in Ongole on Sunday

Highlights

Minister Balineni coaxes them to postpone the date of closure (Nov 15) and assures remedial measures

Ongole: Falling export orders from China and spiralling production cost and transport charge have left the granite polishing and cutting units with no options but to shut operations in Prakasam district.

The district Granite Industries Association leaders met Minister Balineni Srinivasa Reddy to convey their decision but agreed to postpone the shutdown date from November 15 to 20, as he assured to take the issues to the notice of the Chief Minister for remedial arrangements.

There are about 2,000 granite polishing and cutting industries at Chimakurthy, Ballikurava, Addanki, Gurijepalli, Santhanuthalapadu, Martur, Gullapalli Growth Centre and other places in the district and nearly 50,000 people are working in it.

The industries are already facing a hard time due to the Covid-19 pandemic as the merchants from other countries like China are not making any orders to the quarries for stone.

Meanwhile, the increase in fuel prices has raised the cost of transport, while the increased royalty also became a burden for them.

Mandava Ratnakar Rao, president of the Gullapalli Growth Centre Granite Industries Owners' Association said that the transport cost from Chimakurthi to the growth centre increased from Rs 6,500 to Rs 8500, following the increase in the diesel prices. He said that the government also increased the royalty per cubic metre from Rs 4,500 to Rs 6,200. These expenses are increasing the operational cost, but the exporters are reducing the price of the final product quoting the increase of ocean freight after Krishnapatnam port is acquired by the Adani group.

He said that the ocean freight is increased from $700 to $2,100 for a container load to send from India to Vietnam.

Apart from all these, he added that the industries are also suffering from higher electricity charges. He pointed out that Chief Minister YS Jagan Mohan Reddy yet to fulfil his promise made to them during his padayatra in Prakasam district of decreasing the power charges by Rs 3.50 per unit.

He calculated that the production cost decreases from Rs 8 to Rs 4 per square foot if the government could take a favourable decision.

The granite industries are demanding the government to reduce the electricity charges and introduce the slab rate method as in Telangana.

In the earlier meetings with the government, the officials suggested for introduction of a slab rate at Rs 24,000 per one blade, to cut 16 cubic meters of granite stone. But the industries owners said that they would suffer losses and suggested the price should be around Rs 15,000 to 18,000 depending on the number of blades in the industry. Kristipati Sekhar Reddy, the president of the Prakasam district Granite Industries Association informed Minister Balineni Srinivasa Reddy that the polishing and cutting units are planning to shut down from Monday.

The Minister invited the leaders of the associations and discussed the issues with them. He said that their demands will be taken to the notice of the Chief Minister in the Cabinet meet on November 17, and asked them to postpone the shutdown decision.

Sekhar Reddy announced that keeping confidence in the Minister Srinivasa Reddy, they are postponing the shutdown for now and a decision will be taken on November 20, based on the decision of the government.

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