Already Reeling, Lockdown Comes as a Blow for Jalna’s Steel Industry

Unmesh Zambad has a small shop on the road between Aurangabad and Jalna – it is now closed due to the lockdown. Unmesh, who makes a living selling steel items, throws across a question before being asked about how he has been coping. “When will this lockdown be over?” he asked, mentioning that “we will have to sell our land and go to our native place if this continues. There will not be business anymore," he added.

Jalna is one of the major steel producing centres of Central India. It is home to 19 mega industries which employ almost 20,000 labourers. There are also around 5,000 people like Unmesh who have related businesses, but right now, everything is closed.

Dinkar Kote Patil hails from Ahmednagar and works for a private transport company as a driver. His company has twenty trucks and all of them get work from one or the other steel company. But, with the country under lockdown, he has no work. And with Maharashtra also enforcing a district lockdown, Dinkar cannot go back home, which is in another district. “What can we do now? We are sitting here and waiting for this lockdown to be lifted so that we can resume work,” Dinkar said.

About one thousand trucks from Jalna carry steel long distances to Telangana, Karnataka, Madhya Pradesh and all over Maharashtra on a daily basis with up to six thousand tonnes of steel produced here daily. So, a back of the envelope calculation would show that the 21-day lockdown would result in a reduction in steel production of up to 1 lakh tonnes and the loss will be more than Rs 500 crores from Jalna alone.

The steel industry has been struggling over the last three years, especially since the GST came into existence. While the state witnessed a drought in 2018-19, the monsoon of 2019 was a relief for the entire economy as agricultural production rose. As a result, the steel industry was hoping that homes would be built in rural and town areas of the state, which would give a boost to the steel industry as well.

The months between January and May are important for the steel industry as many people build their homes or buildings during these months. At a time when the industry is usually gainfully employed, the lockdown is a blow to the industry's hopes of a revival.

In October 2019, NewsClick wrote about Jalna's steel industry and how it was already facing a slowdown.

“We have kept companies closed as the coronavirus is a serious challenge. But it has had a huge impact on our business. The steel industry here will bear a loss of almost Rs 500 crore and the overall loss to Maharashtra will be more than Rs 2000 crore," said Yogesh Mandhani, chairman of the Steel Manufacturers Association of Maharashtra.