"The usual annual growth of 10 per cent should materialise this year too, despite recession," Standard Fireworks Managing Director Subashsingh Chellathurai said.

Costs of crackers have increased by 10 per cent, due to higher freight costs and labour though raw material costs have not gone up much. Apart from turnover increase, there is normally a quantitative increase in sales. But that may not hold good this year, wholesalers point out.

While there is a growing awareness among people about the dangers of unwanted explosions,there is still a reluctance to give up the pleasure of exploding crackers. The cracker industry is cashing on this, traders say.

There are about 5000 retailers in Chennai and 30 wholesalers. Stocks are being booked at the retail end with no predictable change, said Abdul Razack of Razack Trading House, one of the largest wholesale traders in the south.

He is also the president of the recently formed retailers' association having more than 200 members. But in Tamil Nadu at least, the last three days before Diwali will decide whether the year is good or bad on the fireworks front. Chances of discounts increase as Diwali approaches. Otherwise, retailers are ensured of margins from 15 per cent to 25 per cent.Wholesalers have also started booking bulk orders for the office goers. Of late, more and more people from offices or neighbourhoods are joining together to book bulk orders from wholesalers at 10 per cent to 15 per cent discounts.

Reatilers remain wary however. Competition has increased tremendously.Another concern for them is that bonuses were given one month ahead of Diwali by many companies.

Crackers usually figure last in the agenda of many households after clothes and sweets. With recession setting in, families could use the money for other immediate household requirements. This could lead to a more slender budget for crackers, said CS Alauddin, a wholesaler and retailer. With lesser time to spend bonus money, there are greater chances of expending them in crackers.

The industry, however, sees no immediate threat to its survival. It provides employment over two lakh workers. Sales in Tamil Nadu is expected to touch Rs 50 crore with Chennai alone accounting for Rs 30 crore. Total sales in the country is expected to be in the region of Rs 200 crore. The south produces 80 per cent of the goods, with Delhi, Jalgaon, Calcutta, and other industries in the Gujarat contributing the remaining amount. For the Sivakasi manufacturers, prices could be lowered more for consumers if they did not pay a totalof 40 per cent duty. In Tamil Nadu, the sales tax is 11 per cent, excise is 13 per cent, and insurance and other items contributing to the rest.

Almost the entire Rs 22-crore generated by way of excise comes from the state.