The Hindu Business Line : Mixed performance by Kerala’s top five sectors

Kochi, Nov. 18 The findings of the Industry Monitor Survey conducted by the Confederation of Indian Industry Southern Region for April-September revealed that the top five industry sectors of Kerala have registered a mixed performance.

The top five sectors for the survey were identified on the basis of their contribution to State Gross Domestic Product. The sectors surveyed were rubber, food processing, tourism, coir and chemical and fertiliser industry.

Rubber Expands

Rubber industry production has increased by 2 to 3 per cent, sales by 3 per cent, capacity utilisation levels by 2 per cent during April-September this year as compared to October 2007-March 2008. The rubber industry predicts 2 per cent growth in production, 1 to 2 per cent growth in sales and 1 to 2 per cent growth in capacity utilisation levels during October 2008-March 2009. The industry expects 2 per cent growth in the value of production during the period.

The steep hike in raw materials prices is a major concern of the industry. The non-availability of skilled labour also impacts the industry adversely. Due to increase in fuel prices, power and transportation costs have increased production cost. The industry expects more favourable policy with incentives from the Governments.

Coir sales up

Coir industry production has gone up by 2 to 3 per cent and subsequently sales by 3 per cent during the same period. The industry’s exports have remained unchanged during the same period. The value of production has increased by 2 to 3 per cent. The industry predicts 5 per cent increase in production and sales during October 2008-March 2009.

The rising prices of raw materials, especially the prices of brown fibre, are a major concern of the upstream industry. High transportation cost of coir raw materials reduces profitability. Industry leaders expressed concerns over rising labour wages and non-availability of skilled labour. They demanded reduction of fuel prices, which would help in reducing raw materials’ cost.

Tourism down

Referring to the tourism sector, the survey pointed out that the sector witnessed downward trend in most performance parameters during the period, a lean season for the tourism industry in the State. The inflow of tourists decreased by up to 20 per cent resulting in decreased revenues up to 20 to 25 per cent. The occupancy rate has declined by up to 25 per cent during the period. The tourism industry in Kerala predicts a brisk business during the forthcoming half-yearly period of October 2008-March 2009.

Industry leaders expressed concerns over the lack of skilled manpower availability and urged the Government to take necessary steps to improve road infrastructure.

Food Processing Mixed

The food processing industry recorded mixed trends in performance parameters as the production has registered a growth of 2 per cent compared to October 2007-March 2008. Subsequently, sales have also gone up to 2 per cent. The lack of availability of skilled workforce in the State is an important concern of the industry. Industry leaders opined that low-productivity crops in the State is one of the major problems leading to inadequate availability of raw materials.

Chemical and Fertiliser

Kerala’s chemical and fertiliser industry also experienced mixed trends in its performance.

Industry’s production has increased by 3 to 4 per cent, sales by 1 to 2 per cent and exports by 2 to 3 per cent. Industry leaders sought Government’s support in reducing the time period for mandatory environmental clearances for setting up chemical units. The industry also urged Government to take necessary steps to bring down petroleum products’ prices, which would reduce raw materials’ costs.

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