Cottage-based industry sees 35% rise in turnover to nearly Rs 700 crore and continuing labour shortage, despite grouses on regulations, reach and costs.
Sivakasi in Tamil Nadu, which is just 6.9 sq km but accounts for 95 per cent of the country’s firecracker industry, will see an increase of 35 per cent in its turnover over last calendar year, to well over Rs 650 crore.
It is also increasingly seeing Chinese collaboration for green crackers and aerial displays, rather than sound bursts.
Eight of 10 crackers made in India are from Sivakasi, 650 km south of Chennai. Still, it is a cottage industry here. Around 8,000-odd units, with 650 major players, employ about 250,000 people directly and 100,000 indirectly, mostly women.
“Orders are good this year and the industry is expected to clock around Rs 675 crore turnover, compared to Rs 500 crore last year,” said S S Vijayakumar, president, The Tamil Nadu Fireworks and Amorces Manufacturers’ Association. Around 150 new units have come up this year, he added.
His grouse: In most states, the retail licence is issued only a few days before the Diwali festival. “This is not only preventing dealership from growing, but also hindering our plans for sales and despatch of materials on time,” said S Vellapan, a manufacturer in Sivakasi.
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On new products, Vijayakumar said the new-age crackers that emitted more light than sound were in demand. “Single and multiple aerial shots are the order of the day,” said S Ramalingam, a dealer, adding that customers preferred light-emitting crackers instead of the traditional sound-emitting ones.
“Lots of collective innovation and imagination have gone into making crackers this year, which has resulted in hundreds of new products,” said Vijayakumar. Apart from the local expertise, Chinese technology has been pivotal. The country’s largest fireworks company, Standard Fireworks, is collaborating with a Chinese firm. Subha Singh, Director, Standard Fireworks, said this year the company introduced 50 products, “which are based on both Chinese and Indian technology”. He said major issues for the industry include regulations and labour shortage, which is affecting growth. His company alone employs around 8,000 people in Sivakasi.
On prices, Vijayakumar says those of fireworks have been raised nine per cent to compensate for raw material costs, up by seven per cent, and labour cost, which has increased by 20 per cent. Salary levels are around Rs 150-160 per day plus provident fund, medical, etc. A major proportion of the workers are women and school dropouts. Labour shortage has resulted in mechanisation in chemical mixing and filling, where the products are used by the pharmaceutical industry, he says.
On regulations, the industry is controlled by 18 departments and this slows the growth, says Vijayakumar. Other industry representatives add: “Transportation is another big hurdle. Direct shipments are not available and the postal department does not accept fireworks’ sample parcels.” Also, there are hardly any wholesalers or middlemen. Retailers with a licence deal with the manufacturers directly. There is a huge gap between manufacturing and selling prices, they added.