The Hindu Business Line : Dunlop may restart production at Chennai on Nov 1

Chennai, Oct. 21 Dunlop India Ltd is expected to restart production at Chennai with the suspension of operation to be lifted in a day or two. Production is likely to start on November 1.

The Dunlop Factory Employees Union, led by its President, and Member of Parliament, Mr A. Krishnaswamy, and the Dunlop management are to finalise the deal on Monday. The talks are mediated by the Tamil Nadu Labour Department, according to union sources.

Mr Pawan Kumar Ruia, Chairman and Managing Director, Dunlop India Ltd, said the differences with the workers had been sorted out. Once the agreement is signed, it would be possible to reopen the factory immediately with production in November. The company would settle the dues to the workers. Utilities were in place; power will be restored by the month-end and water supply was not an issue. The company has sufficient funds to run the operations, he said.

In Kolkata, at the Sahagunj factory, production has stabilised and the unit is running seven days a week. Work would have started in August in Chennai if it had not been for the legal hassles over the factory land. The issue is now in court, Mr Ruia said.

According to union sources, the final schedule of restarting production, payment of statutory dues to the retired employees, the payment of compensation under the Early Retirement Scheme to over 190 workers who have opted to retire under a plan to reduce workforce and the wage dues to over 1,000 workers with the company, would all be finalised under the agreement.

Dunlop India, under the Kolkata-based Ruias, officially suspended operations at the Ambattur factory in Chennai last August.

At that time it had blamed a city-based developer, VGN Enterprises, for taking over a portion of land within the production area. The land had been sold to the developer in 2004 through a BIFR process – Dunlop was then under the Jumbo group – to rehabilitate the sick company. The issue of the disputed portion of land, about 8 acres out of the total of about 60 acres bought by the developer, is now in court.

The unit had been shut between 1998, when it stopped operations due to a fund crunch, and 2006. Except for a short stint in 2000, the company remained closed till the Ruias acquired Dunlop from the Jumbo group in December 2005. Dunlop recommenced operations in August 2006 but financial problems continued to plague it and the Ambattur facility managed only a fraction of its potential production capacity of about 90 tonnes a day, which the Ruias have said would be expanded to 130 tonnes.

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Dunlop may restart production at Chennai on Nov 1