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Posted at: Jun 13, 2018, 12:49 AM; last updated: Jun 13, 2018, 12:49 AM (IST)

Chinese imports threaten Amritsar’s screw, bolt industry

Rising input costs, quality issues erode competitiveness
Chinese imports threaten Amritsar’s screw, bolt industry
Workers roll out screws, nuts and bolts at a factory in Amritsar on Tuesday. Photo: Sunil Kumar

Neeraj Bagga

Tribune News Service

Amritsar, June 12

A double whammy has hit the industrial cluster of Amritsar. Besides stiff competition from the Chinese imports, the local manufacturers of screw, nut- bolt, printing and packaging machineries are now hit by a spike in iron prices that has also slowed construction activities in the region.

The city is fast losing its edge of being a domestic market leader in the manufacturing of screw and nut-bolts to China, the industry leaders said.

The city, which has been a hub for manufacturing printing and cutting machineries in the country, has received a setback after considerable hike in the price of iron, a key raw material, Rajiv Sharma, a hardware unit owner based in the Industrial Area - East Mohan Nagar, said. The industry uses pig iron as raw material, which has seen a 46% jump in the input cost to Rs 54 per kg. That has resulted in a 30% fall in demand, he said.

The story of screw and nut-bolt manufacturers is the same. Samir Goel of Narayan Steel said, the rates of finished nut-bolt rose by almost 40% at Rs 53 per kg in past few months due to rising input costs. Similarly, a screw has become dearer by almost 8% to Rs 70 per kg, he said.

“Trend in price of iron has been upward since January,” he said. Post GST, nearly half of 400-odd units in the sector have been perished, he added. “Since most of these units fall in the cottage industry, they were unable to withstand the import surge,” he said.

The demand for domestically manufactured items has dwindled. Chinese screws have flooded the Indian market, edging out the city’s leadership position as the screw manufacturing hub of the country, Surinder Mohan of Bhagwati Iron and Steel Works said. His company was set up in 1952.

“Chinese screw is costlier than the domestically manufactured screw. However, it is still preferred for being superior in quality and strength due to technical upgrade of Chinese small scale industry,” he said.

To manufacture quality product, the industry needs huge investments. China has upgraded its technology by installing sophisticated heat treatment plant costing over Rs 4 crore with a capacity to handle 300 tonne iron ore per month. In contrast, the local plant is worth Rs 3-4 lakh with a capacity of 40 tonne.

The local industry has not undertaken any technical upgrade in the absence of government support. The industry needs help in getting access to technical know-how and low-cost capital, said Pankaj Kohli of Sticks Furnaces India Pvt Ltd.

Citing the example of drive wall screw, he said, the locally made product is available for Rs 115 per kg and the Chinese is sold for Rs 145 per kg. But, the latter is preferred because of its hardness, finish and strength. 

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