Amid slowdown in construction industry, the ceramic and vitrified tile manufacturers in Morbi have been forced to cut down their production capacity to 50 per cent. The units have made fresh representations with the Gujarat government to offer relief through certain measures.
"Currently, the slowdown in construction industry has forced us to cut down our production. All the units in Morbi are running at 50 per cent capacity. The international gas price has fallen from $ 9 per million btu to $ 5 per million btu. Which is why, we have asked the state government to now bring down gas price from Rs 15 per scmd to Rs 11 per scmd that might offer some respite to the units amidst slowdown," said Girish Pethapara, chairman of Decolight Ceramics Ltd.
Apart from gas prices, the units are also demanding other benefits as well. "We are also asking the government to increase the subsidy on exports from 6 per cent to 15 per cent. Also, to stand against the Chinese products, we are the government to put more duty on import materials," said Pethapara. Also, the units are demanding a reduction in value added tax (VAT) from 12.5 per cent to 4 per cent. According to Pethapara, the units are asking the government to treat tiles as construction industry raw material instead of treating them as end user products.
Instead of manufacturing at their regular capacity of overall 15 lakh sq metre per day of tiles including wall, floor, vitrified and ceramic, the Morbi-based units are producing only nine lakh sq metre per day.
There are around 270 ceramic units, 150 wall tiles units, 54 floor tiles units, 22 vitrified units, and 45 sanitaryware units. While, when in full swing Morbi tile industry's turnover is Rs 10,000 crore per annum, currently, the industry books around Rs 7,500 per annum.