Surge in Covid-19 cases gives a blow to industrial revival

LUCKNOW: Increasing cases of Covid-19 has once again set the alarm bells ringing for industries where production has already started witnessing a slump in Uttar Pradesh.

Around 20,000 industrial units in Noida and in its adjoining areas are already working 50 percent below their capacity.

Average turnover of small and medium units in these places is around Rs 5 crore per annum. These 20,000 units were expected to make a turnover of around Rs 80,000 crore to Rs 90,000 crore in the last financial year.

But as production went below 50 percent, turnover also went far below 50 percent. Beginning of the new financial year (2021-22) is no better.

Amid a massive surge in Covid-19 cases, industrial production has further gone down due to slump in demand.

The Industrial hub of Noida suffered financial loss of around Rs 30,000 to Rs 35000 crore in the last financial year (2020-21) when industrial activity was completely derailed due to lockdown.

Till October-November last year, industries were working at 20 percent of their capacity in Noida, Meerut and its adjoining areas.However, things started improving from December last and this trend continued till February this year. But from March this year as Covid-19 cases again started rising, industrial production has again gone down below 50 percent.

Readymade garment industry

Noida is also known as ‘city of apparel’.

Around 3,000 garment units in Noida provide maximum employment among all sectors. Out of this, there are around 850 exporters. All these units are running below 50 percent of their capacity.

The domestic garment market was expected to pick up from Holi onwards. But increasing cases of Covid-19 has led to decreasing demand in garment sector.

“No new order is coming from domestic market. After second wave of Covid-19, orders have dried up. Noida caters to almost entire garment market in Uttar Pradesh and large parts of the country,” said Rajiv Bansal, garment manufacturer from Noida.

Garment export from Noida to Europe has almost stopped as orders have dried up after the second wave of Covid-19 in United Kingdom and other parts of Europe, including France, Germany and Spain.

“Orders from Europe have altogether stopped after new variant of Covid-19 was detected in UK in November last,” added Bansal.

Pankaj Kumar, national president of Indian Industries Association, said: “More than 5,000 traders owing small and medium units in Noida and its adjoining areas took relief package from the state government in the last financial year.”

“As industrial production has not picked up and have gone down further, these traders are finding it difficult to return the loan amount,” added Kumar.

“After the festive occasion of Holi workforce has also not returned in some units due to surge in Covid-19 cases. Labourers are also reluctant to return as memories of last year’s lockdown still haunt them,” said Kumar.