The Hindu Business Line : Sivakasi match units facing crisis

Sops needed
Excise relief should be given on raw materials.
Seeks additional incentive of at least 2 paise per box.
Plea to increase per box price to Re 1.

Kolkata , Aug. 21

Most match units in Tamil Nadu, traditionally rooted in the dry belts of Sivakasi, Kovilpatti, Srivilliputhur and Sathur in Virudunagar district, and nurtured for over six decades by the enterprising Nadar community, are today in the grip of a severe crisis due to rising raw materials prices, rising wax prices and growing labour shortages.

While wax and wood splints are becoming costlier by the day and also not available freely, women labour, used for box filling, are switching to greener pastures largely owing to non-implementation of minimum wages despite a State Government diktat.

Sivakasi sources say the minimum wage fixed is Rs 3.06 per unit of 100 matchboxes, while labourers are paid only Rs 1.75 per unit. Match units plead their inability to pay more because of declining margins and climbing input costs.

A 20 per cent increase in wages has recently been brought about, but this is not enough to keep the labour interested, it is said. The small and tiny units in the cottage sector, arguably the most vulnerable and which depend totally on the private distributive trade for reaching the end product to the market, are really in a tight corner.

Excise relief

Talking to Business Line in Sathur recently, Mr S. Palanikumar, President of the All India Federation of Cottage Matches Manufacturers' Association, said per box price should immediately be raised to Re 1 from the prevailing 50 paise and excise relief should be given on raw materials such as potassium chlorate, wax and splints, particularly used by tiny units.

He sought an additional incentive of at least 2 paise per matchbox (600 boxes go to make a bundle), which can add to the wage component a neat Rs 12 per bundle. He says that big companies such as ITC can take the lead by raising the per box price to Re 1.

Mr Palanikumar has been saying that ITC having entered the matches sector, was queering the pitch for cottage units on the per bundle price front.

Sourcing from SSI units

When asked to comment, Mr R. Srinivasan, Member, Corporate Management Committee, ITC Ltd, said the company markets safety matches sourced entirely from as many as 55 small-scale and cottage units, and has in fact contributed towards price and quality stability for all players to benefit.

Refuting Mr Palanikumar's charges, he said ITC has constantly focused on product quality, better safety & fire safety standards, enhanced supply chain capabilities and distribution reach.