Terming as "unreasonable" the recent wage pact for plantation workers in Kerala, a planters body of southern states today said it would lead to collapse of the sector and sought the state government's urgent intervention to "neutrualise" the situation.
United Planters' Association of Southern India (UPASI) President N Dharmaraj said the new wage for plantation workers prescribed in Kerala had come at a time when the industry "is already reeling under the burden of low prices and high costs.
"This is very unfortunate for the plantations, which employ over a million people and dependents, and will destroy the rural economy of plantation areas in the state," Dharmaraj said in a statement.
Plantation workers, on October 14, had called off their fortnight-old indefinite strike after an agreement was reached on wage hike during tripartite talks under which an average daily wage of Rs 301 would be paid to workers in tea estates, Rs 381 in rubber, Rs 330 in cardamom and Rs 301 in coffee estates, an average increase of Rs 65 to Rs 69.
He said that in tea and coffee sector, the wage increase along with statutory benefits would result in an increase to Rs 436 per day, while in rubber, the total daily wage, including statutory benefits, is Rs 552 per day.
"Kerala, which currently produce around 67 M.Kgs of tea, 68 thousand tonnes of coffee, 5.65 lakh tonnes of natural rubber and contributing to the exchequer around Rs 13,243 crore, will be affected on account of unreasonable wage increase," he said.
He claimed that it was certain that the state's role in plantation sector would be eroded due to the loss in production, export and employment.
He urged the Kerala government to "urgently take note of this grave situation" and deliberate with the industry the ways and means of neutralising the huge additional financial burden to be borne by the industry.
Claiming that the present wage increase of 30 per cent plus in tea was the highest ever, Dharmaraj said the plantations in south India were not against paying higher wages, but the current economic realities coupled with the plethora of taxes and levies, does not make it a viable proposition.
"The wages that is being forced upon, without considering the capacity of the industry to pay, will lead to the collapse of this sector," he said.
"Many plantations will be compelled to reduce the workforce to sustain themselves. All these would result in a permanent damage to this sector," Dharmaraj said, adding already seven estates and 14 factories were lying closed.
