Lockdown takes away fragrance of agarbatti industry but here’s why it may rebounce soon

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Updated: May 18, 2020 2:52 PM

Even being a completely labour-based industry, the agarbatti industry expects the operations to quickly rebounce as the it employs local workers.

agarbatti industry, incese stick, lockdown, coronavirus,, labour, rural economy It has become tough for the agarbatti industry to sustain the huge labour force.

India’s centuries-old agarbatti industry with over three thousand manufacturers across the country and employing lakhs of informal workers, is stuck amid coronavirus-led lockdown. However, even being a completely labour-based industry, it expects the operations to quickly rebounce as the agarbatti industry employs local workers and not the migrant workers. “All the workers are expected to come back immediately as the lockdown gets over because most of the employment is local,” Arjun Ranga, Managing Director, Cycle Pure Agarbathies, told Samrat Sharma of Financial Express Online in an interview. However, it has become tough for the industry to sustain the huge labour force, Arjun Ranga added.

Here are excerpts from the interview.

1) What role does the agarbatti industry play in India?

The agarbatti industry has been in India for centuries now. It’s a highly fragmented industry, with over three thousand manufacturers across the country. It encompasses a huge employment generation, right from the raw material procurement to the making of the raw agarbatti stick, to fragrancing activity, packaging agarbatti and finally the sales and distribution across the country. The category has 82% penetration into retail in India.

In terms of number, an estimate to Indian agarbatti retail market is around Rs 7000 Crores. Regarding exports, Indian agarbattis are exported to about 160 countries. In the year 2018 – 2019, annual sales of agarbattis were around Rs 750 crores.

2) How much has the agarbatti industry suffered during the lockdown?

In the wake of COVID-19 and the nation going for the lockdown to curb the spread of the disease, the sales have come to standstill and the situation has become tough for us to sustain this huge labor force. The total employment generated by the Agarbatti industry is close to 4 lakhs. Out of these, about 1.50 lakh employees are directly under the payrolls of the industry, another 2 lakh work for the ancillary units of packing and raw Agarbatti making and the remainder belong to the tertiary category of casual workers such as loaders, unloaders, handlers and sorters.

Also Read: Amazon, Flipkart and others eye to resume delivery of non-essentials amid lockdown

3) Will the government’s relief measures help the industry?

We support the relief package announced by the government. The agarbatti industry employs a lot of daily wage labourers for making the raw agarbatti sticks and a lot of rural women who mostly work from home. Most of these women would have come under the Prime Minister’s Garib Kalyan Yojana. In 2019 August, the GOI had imposed restrictions on the import of raw agarbatti, which is a very important component of our product and due to this, manual labour has increased. The entire agarbatti industry has been eking out slender margins, with the hope of growing into a remarkable industry.

The government has given some relief and we have made some appeal to Shri Nitin Gadkari Ji, Honourable Minister of MSME to provide the following reliefs and include these in the plan of relief so that the industry sustains as the industry has garnered no revenues for past two months.

  • Financial support to part-time homeworkers
  • Financial support to tertiary labour
  • Financial support to manufacturing labour
  • Refund of GST paid on supply of services received
  • Waiver of ESI subscription
  • Issuance of the import license for raw agarbatti

4) How many workers from the industry might have lost their jobs? Do you expect them to quickly return after lockdown is over?

Nobody would have possibly lost their jobs, purely because all of them work from home and this industry does not depend on migrant labourers. As soon as the operations will start, everyone will get back to their work. All of them are expected to come back immediately as the lockdown gets over because most of the employment is local.

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