After causing wealth erosion of billionaires, the economic slowdown has now travelled to the poor man's house in India. The sale of kerosene stove, mainly used for cooking by people dwelling below the poverty line, has dipped by 20-25 per cent in the last one year owing to non-availability of the fuel and financial crisis.
Already the stove manufacturing industry was facing turbulent times mainly due to escalating raw material prices and going by industry estimates the sales have dipped by 50% in last five years.
Rajkot is considered as a hub for stove industry producing as many as 3,000 stoves per day however since the 2008 stove manufacturers have added no new entry in their order books, according to an industry sources. Sources further said that this was the scenario in other places too including Delhi, Kolkatta, Meerut and Jaipur.
Rajkot housed over 25 small and big kerosene manufacturers however this number has reduced by half with other players diversifying to engineering and automobile sectors. The industry size is estimated at Rs 600 to Rs 700 crore and Rajkot has a lion’s share of almost 50 per cent in this unorganized sector.
Saral Stove which produced about 400 stove units per day six months ago has cut down its production to 300 pieces per day, according to a company official.
“Rajkot is main hub for producing stoves in India. Five years ago, production of stove was 2.50 lakh units per month, but today the production is 1.25 to 1.50 lakh units per month,” said Harkishor Barchha of Ashok group industries from Rajkot, one of the top brands in India.
Distribution and sale of kerosene is controlled by government which has lead to higher price and unavailability of fuel, he added.
The price hike in raw material has been a major cause of worry for the industry. Iron and steel rate recently goes high and this made production cost higher at least by 15 per cent. Currently, the producers are not able to cash in on the falling prices of raw materials on account of lower demand and with half of the them turning to other industries.
India exports 10 percent of its total production, mainly to East Africa and the export demand has also gone down in recent times. India’s share in the global market is meager as compared to China which is the main supplier.
“With globalisation in India, the standard of living has also gone high and people have turned to electric and gas stoves. Even hospitals and laboratories have stopped using kerosene stoves. The raw material prices have come down but the industry is currently facing financial crisis,” said Mr. Nitin Chotai, Owner of Saral Stove.
