“In Okhla, there are over 5,000 industries of which around 50 percent shut down last year,” said Ahmed Aziz, general secretary of the Okhla Industries Association. “Of that 50 percent, half have migrated from Delhi due to losses and the rest are out of business.”
Factories in the national capital are staring at a bleak future, even as Delhi chief minister Arvind Kejriwal announced that factories and the construction sector could resume operations from May 31. The factories, which have been shut for nearly six weeks, are struggling with a shortage of labour and raw materials, and low demand.
Delhi has 8.93 lakh industrial establishments, according to the of 2013. The capital contributes 4.94 percent to India’s total GDP; the industrial sector alone accounts for 12 percent of this contribution.
On June 2 and 3, Newslaundry visited several factory units in Okhla industrial area in the southern district and Gandhinagar’s garment industry in the eastern district. Okhla industrial area primarily comprises factory units of garment exporters, pharmaceutical manufacturers, printing presses, machinery manufacturers, and plastic and packaging manufacturers. Gandhinagar market, on the other hand, is Asia’s biggest textile market.
We found numerous factories still recovering from the losses of last year’s pandemic-induced lockdown and the fact that eight lakh migrant workers left Delhi during the second wave of the pandemic. Many industrialists told Newslaundry that the government’s apathy towards small-scale manufacturing units has compounded their problems.
Chetan Kohli, the director of Kohli Printofast, a print and packaging company, said he only has one employee remaining in his design team. His factory in Phase II of Okhla industrial area is currently functioning with 25 percent of its workforce. Kohli said his business has incurred a loss of Rs 60 lakh this year.
Another issue is that while Delhi’s factories shut during the lockdown, factories in Punjab, Uttar Pradesh and Haryana did not. As a result, many units in Delhi lost their clients to competitors. Business owners now worry that it might take years for the market to revive.
“Until the next two years, it will be very difficult and challenging for MSMEs to function,” said Bharat JS Gulati, the head of PACCO Industrial Corporation, a leading supplier of carburetors that also manufactures fuel pumps for vehicles. “Especially those who are associated with the hospitality industries such as restaurants. They will probably not be willing to reopen their businesses.”