Ukraine crisis hits Jalandhar exporters hard

Tribune News Service

Deepkamal Kaur

Jalandhar, March 1

The Jalandhar-based manufacturers have been hit hard by the ongoing war between Ukraine and Russia. Those who were into export business here have said that they are facing a double blow as on one side the raw materials have become expensive, the export orders too were getting cancelled.

The worst affected are the manufacturers of sports goods, handtools and leather goods. Rajesh Mayor, who is one of the top exporters from among the sports manufacturers, says: “The prices of raw material including raisins, plastics and synthetics used in our industry have got jacked up because of the ongoing crisis. The worse is that Russia, with which our company had exports business for the past 32 years, has put all our orders on hold. We have been exporting footballs and sports shoes to Russia. Several orders which were in shipment have not reached the country. We have already taken 30% advance payment for these orders and the remaining 70% was to be paid on delivery. So, even that remains an issue as of now”.

The leather goods manufacturers also have said that the prices of all petro-based chemicals used in the industry have increased by 25-30 per cent since December last. “Ever since there had been reports of tension getting escalated, prices of raw material had started increasing. Since our cost of production has increased, our competitors world over get an edge over us in terms of prices offered. We had also been getting cow hides from Russia, which too has stopped as of now. Our market too had been in Europe, from where the orders have slowed down. So, the leather industry here which was in dire state already because of Covid situation, has further got badly hit”, said SPS Virk, leather goods manufacturer.

The handtool manufacturers from across the region have also got badly affected. Says Chairperson of Federation of Indian Export Organisations, Ashwani Victor: “The handtool manufacturers from northern India had Rs 300 crore export business with Russia and Ukraine, all of which has suddenly come to a standstill. The vessels which were carrying our products have not been able to reach Russia owing to the prevailing risk. Our biggest worries began when there were reports that Export Credit Guarantee Corporation (ECGC) had withdrawn its cover on the export transactions to Russia but now we have formally received a communication that the risk coverage stands.”

A prominent handtool exporter, Sharad Aggarwal, said: “The entire handtool industry is in dilemma as the steel prices have gone all-time high from Rs 47,000 a ton to Rs 55,000 a ton today. So on one side, we have the raw material prices soaring and on the other side all our export business to Russia and Ukraine has crashed. We had been selling spanners, pliers, wrenches, chisels and various other items to both these countries. At least 100 containers have got affected, some of which have reached, others are on way and some orders were in the pipeline. Our payment from Russia which used to come in US dollars too is expected to get blocked till the crisis remains.”

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