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Global financial meltdown trickles down

business Updated: Oct 24, 2008 01:34 IST
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In an indicator of how the shock from Wall Street is traveling to heart of rural India, thousands of skilled workers in two small towns, one in Uttar Pradesh and one in Haryana, have been laid off after orders from their global markets — mostly in the US and Europe — dried up this month.

<b1>In Moradabad, 167 km from Delhi, artisans adept at the centuries-old art of crafting brassware for European and American showrooms are pulling cycle rickshaws and selling fruit as trade unions report a loss of 25,000 jobs.

Panipat, from where rugs, bedsheets, and other textiles wind up in US stories like WalMart or Sweden’s Ikea, has weavers migrating or working at jobs that now pay 1/18th of what they did.

Moradabad’s biggest exporter, CL Gupta Exports Ltd, is reporting no orders of any significance this month. “We have several crores worth of material lying with us as the markets cancelled their orders over the last two-three weeks,” said Managing Director Ajay Gupta. “We supply mostly to the US and with the economic downfall there, orders are down 30 per cent.”

Gupta is luckier than other companies in Moradabad; they report a decline of up to 60 per cent.

“The present situation is very bad and the future shows no hope,” said Gupta, who is also the spokesman for Moradabad exporters.

On the streets, Mohammed Alam (40) is doing something he considers “a disgrace”: Pulling a rickshaw. Artisans like him earned between Rs 150 and Rs 200 a day. That’s now down to Rs 50 to Rs 75.

About 250 km to the west, an elevated national highway with its modern cars soars above a chaotic city dotted with tony homes and malls. Panipat got rich as its power looms raked in business worth Rs 2,000 crore each year.

Today, cotton bales and dyes rot in warehouses and shocked migrant workers from UP and West Bengal go from factory to factory looking for work.

Exporters won’t reveal individual income-drops, but orders from global stores have dropped 40 per cent, said textile exporters’ spokesman Ram Niwas Gupta.