Resumption post-Coronavirus lockdown: DMs hold the key to firms opening plant, office lock

By: |
Published: May 6, 2020 4:15:48 AM

Companies need to seek permission from the local administration – the office of the district magistrate – by submitting a host of information. Apart from the process being tedious and time-consuming, the final decision rests at DM's discretion.

This cumbersome process is not only limited to manufacturing units but even applies for corporate offices in places like Gurgaon. (Representative image)

If the reopening of factories and offices is moving at a snail’s pace even in the non-containment areas, despite the Ministry of Home Affairs allowing operations from May 4, it’s because the process is not automatic. Companies need to seek permission from the local administration – the office of the district magistrate – by submitting a host of information. Apart from the process being tedious and time-consuming, the final decision rests at DM’s discretion.

So, a manufacturing plant, say in Gurgaon, has to first fill online a detailed form saying how many people will come to its factory, how many cars will come, what kind of sanitisation it has done at the unit, from which areas will the workers come, etc. Some get approval fast but some may get stuck for a couple of days.

And this cumbersome process is not only limited to manufacturing units. It even applies for corporate offices in places like Gurgaon. For instance, a small e-commerce unit in the city, which employs around a dozen employees, applied for permission some two days back but is yet to get an approval. On Tuesday, the district administration added some new fields in the online portal for seeking permission, so the firm needs to apply again and wait for the approval to come.

An auto manufacturing unit in Chennai got permission to operate on Monday evening, two days after applying. The company told FE that it is in the process of starting some routine operations from Wednesday but is not sure whether its vendors will be able to get permission.

In Noida and Greater Noida, where also a large number of manufacturing units are located, the process of reopening is no less cumbersome. The district administration on Tuesday unveiled a portal for processing such requests. Once a unit has applied, the request is processed by the respective SDM’s office and is forwarded depending on where the unit is located to the Noida Authority or the Greater Noida Industrial Development Authority (GNIDA) or Yamuna Expressway Industrial Development Authority (YEIDA). It is also sent to the regional manager of Uttar Pradesh Industrial Development Authority (UPSIDA) and the respective ADMs for issuing final permissions in their respective zones.

In case of special economic zones (SEZ) and export-oriented units (EOU), the development commissioner (government of India) will issue permission after consulting incident commanders (officials entrusted with emergency response measures).

When the MHA’s fresh rules came on Friday evening that offices could work with 33% of their staff by following social distancing and other such SOPs, some companies in Mumbai started preparations to restart their corporate offices, but the very next day the state government came out with an order that in the Mumbai Metropolitan Region no offices can function.

Among the ones which have got permission to operate till now are Hero MotoCorp, which said on Monday that it will commence operations in a graded manner at three of its manufacturing plants at ― Gurgaon and Dharuhera in Haryana, Haridwar in Uttarakhand and additionally the Global Parts Centre (GPC) at Neemrana in Rajasthan. It said that its other manufacturing plants have also obtained the necessary permissions to reopen and these will commence operations after most of the supply chain partners of the company get the permissions to operate.

On Tuesday, Toyota Kirloskar Motors said that it has got permission to restart operations but added that it is a challenge for the auto sector to start production, as it is necessary that the entire value chain starts operating. “Our value chain consists not only of our suppliers but our dealers as well who are based in different parts of the country including cities that are still under severe lockdown,” the company said.

Meanwhile, around 200-plus companies in Pune’s industrial belt of Chakan, Talegaon, Kurkumb, Baramati and Ranjangaon have resumed operations. So, Bajaj Auto resumed operations at its Chakan plant on Tuesday, while Bharat Forge said it will commence partial operations at its Baramati plant. M&M has started pre-production activities at its Chakan plant. In Pune, units were allowed by the DMs to start operations without any formal process or special passes as long as they were located outside the containment zones. Still, Arvind Goel, MD and CEO, Tata AutoComp Systems and chairman of CII Maharashtra state, said while there was clarity at the top level of government, it was not the same at the ground level as the local tehsildar and police were interpreting things differently making it difficult for units to start production.

Do you know What is Cash Reserve Ratio (CRR), Finance Bill, Fiscal Policy in India, Expenditure Budget, Customs Duty? FE Knowledge Desk explains each of these and more in detail at Financial Express Explained. Also get Live BSE/NSE Stock Prices, latest NAV of Mutual Funds, Best equity funds, Top Gainers, Top Losers on Financial Express. Don’t forget to try our free Income Tax Calculator tool.

Financial Express is now on Telegram. Click here to join our channel and stay updated with the latest Biz news and updates.

Next Stories
1Ordinances on inter-state farm trade, contract farming out of judicial process
2Overcoming clearance delays: Embedded approvals for mineral blocks
3Leash on spending: Govt puts a pause on new schemes