Engineering Export Promotion Council (EEPC) is having a bad time. It is not the regular case of steel prices which is bothering the engineering manufacturers in Ludhiana but labour problems. Despite having orders, the exporters are finding it tough to meet the demand in the wake of labour shortage.
Regional Chairman EEPC and President Ludhiana Hand Tool Association S C Ralhan said the outlook for the industry had improved with prices of steel softening a bit and demand for exports also moving up. However, labour problem had emerged as bottleneck.
According to Ralhan, Ludhiana has over 15,000 engineering good manufacturers who annually make products worth Rs 5,000-6,000 crore, which include forging industry, hand tools, cycle parts and tractor parts.
Ralhan added despite the steel prices (which have softened) still more in comparison to China, orders have started picking from the US and Europe and there is 10-12 per cent improvement in business this year compared to last year. Despite having more orders exporters are finding it tough to meet the new orders in the wake of labour shortage.
“The flagship Mahatma Gandhi National Rural Employment Guarantee Scheme (MNREGS) has created a problem for the industry in Punjab and if steps are not taken it could pose a challenge to the survival of industry in future.”
Avinash Gupta, Convenor Forging panel, maintained orders this year are 15-20 per cent more compared with the previous year. Last year the slowdown in the global economy had impacted the business of engineering goods exporters from the city and they are anticipating better season this year.
“However in wake of acute labour shortage going on we are facing the challenge of meeting export commitments.”
As a solution to labour shortage the industrialists are contemplating on automation in sectors which is possible. However, they maintain that automation would take time and till then it would be hard for them to find a solution to the labour shortage.