For Indian cricket team, the year 2008 might have been quite fruitful as it became the T20 champion and won a number of Test and one-day series.
However, for the city’s sports industry, which supplies cricket equipment to players, the year was full of worries as a steep decline in business was noticed in both domestic and international market.
In 2007, the city’s sports goods industry did a fairly good business both in international and domestic market. However, in the beginning of new financial year a big blow came for the state’s industry, as its rival industry in Meerut received a big boost when the Uttar Pradesh government announced full exemption from value added tax (VAT) for the state’s sports industry.
Sports goods industrialists of Punjab also demanded similar exemption from the state government. The agitation for the purpose still continues as the sports industry is divided on the issue because exporters were not in favour of an exemption of VAT.
The industry, which used to contribute about Rs 450 crore to the national export figure, could manage to get the export order not more than Rs 300 crore and witnessed a 30 to 40 per cent decline in exports, sources in the sports industry revealed.
“Our export orders have been declined around 30 to 40 per cent while the business in domestic market has also registered a downfall of around 50 per cent,” Ramesh Kohli of Beat All Sports said, adding that industry was now waiting for a huge relief package from the state government.
Kohli, whose sports manufacturing unit has a turnover of Rs 13 crore, revealed that his company was fully involved in domestic and international market.
Kohli claimed that their factory has been feeling the wrath of meltdown from the last three months and it has registered a 30 per cent decline in export orders and many foreign clients have even held their already placed orders.
Ashok Verma, proprietor of Savi International which exports sports equipment like rugby balls and soccer balls, said that although in 2007 almost the whole sports industry had a good time due to plenty of orders, the situation has changed drastically as the company has suffered about 45 per cent cut in its order.
“Our export is mainly in the European countries and due to the global economic slowdown, no big buyer has shown interest in importing sports goods from us,” he lamented.
“If the situation continues, more than 15,000 workers will be rendered jobless in the next few months in Punjab only besides the rural workers who comes from the adjoining districts and also from Bihar and UP,” he claimed.
Katyal said “there is huge adverse impact on the sports industry due to global meltdown, as virtually there is no buyer in the international market and exporters are facing payment squeeze especially in the South America, where importers are facing acute financial crunch due to slowdown of the economy. Even in Germany, which used to be the big importer of soccer, sports industry has obtained no order and only hope was the forthcoming international ISPO fair in Germany scheduled to be held from February one to four, where Sakay Traders would also participate, he added. Due to the current situation, almost all sports goods manufacturing units has put of at least 50 per cent cut in its production, he claimed. Rana Raghunath Singh, leading exporters and President of Sports Goods Manufacturer and Exporters Associations rued that sports despite of being the most labour intensive sector was given step motherly treatment by the government as the recent fiscal stimulus package announced by the government had no mention of sports sector. Rana said that Jalandhar which was exporting goods worth Rs 450 crore would hardly be able to export goods worth Rs 275 crore this year due to meltdown. He also feared that if Foreign Direct Investment (FDI) would be enhanced in the sports goods manufacturing, as per the indications, Multi National companies like Adidass, Reebok, Nike etc may come up to set their own manufacturing units, to put a further dent on indigenous sports goods industry.
