Sivakasi fireworks industry crippled by demonetisation

MADURAI: It's been about 20 days since Diwali celebrations got over, but Sivakasi's cracker industry - the fireworks hub of the country - is yet to resume full-fledged production. If it was the freaky weather which played spoilsport first, it is demonetisation that is wreaking havoc now.
Working at a feverish pace before Diwali, the industry usually takes a week-long break. The production resumes once the northeast monsoon ends, usually around this time, but most fireworks units are yet to get back to work.While mist, haze and delayed monsoon ensured that the labour-intensive sector remained indoors, demonetisation of high-value currency notes has hit business hard.
Most manufacturers did open their factories by the first week of November and carry out symbolic rituals for commencing production. However, once demonetisation of 500 and 1,000 notes was announced, most of the units suspended their activities. In addition to procuring raw materials, wage is an important component of the industry, according to manufacturers. At least 100 people work in a medium size industry and there are more than 700 fireworks manufacturing units in Sivakasi. "A typical unit may need 10 lakh a week to manage wages and meet expenditure. With so much of restrictions to withdraw cash, it is difficult to mobilise such volume of money", said T Kannan, president of The Indian Fireworks Manufacturers Association (TIFMA).