Continued economic recession in European countries, which are the primary market for hand tools manufactured in the city, has caused a steep decline in exports, forcing some exporters to diversify into other fields, and others to import Chinese tools for trading in the domestic market.
“Around two years ago, the local exporters used to export goods worth Rs. 800 crore. The exports declined to Rs. 450 in the last fiscal year, and are expected to decrease further in the current year, primarily due to the current economic situation of the European countries,” president of Hand Tools Manufacturers' Association Sukhdev Raj told HT.
Exports have been hit due to lack of modern technology as well, with the hand tool industry of China, which has far more advanced technology, eating into India's share of hand tool exports, he added.
While the Centre had sponsored an Rs. 80crore project to set up a common facility centre (CFC) to get competitive technology, the project was scrapped in May this year due to bickering and power tussles in the industrialists' lobby, Raj said.
“It is not economically viable for any individual unit to induct the latest machinery on its own, so the scrapping of the CFC project will continue to adversely affect the industry in the future,” he added.
Some of the industrial units have now started diversifying, with a few opting to manufacture other engineering items, while some are investing in real estate, Raj said, adding that several units have started importing and trading in China-made hand tools.
“The Chinese hand tools have become so popular in the country that this year, more than Rs. 1,000crore worth of sockets and their accessories have been imported, and the figure is expected to go higher next year,” said Ashwani Kumar, managing director hand tool exporting company Victor Tools.
To launch a project on power conservation, United Nations Industrial Development Organisation (UNIDO) and the Bureau of Energy Efficiency (BEE) will organise a workshop in the city on Monday. The workshop will be aimed at reaching out to the maximum number of micro, small and medium enterprises, so that they can enroll themselves for adopting power conservation measures for the next three years. By adopting energy efficiency and renewable energy measures with the help of the UNIDO, which extends subsidy on such activities, the industry would be able to cut costs.
Hand tool exports from Jalandhar in 2011: Rs. 800 crore
Exports in 2012: Rs. 450 crore
Reasons for decline
· Continued economic recession in European countries, which are major importers
· Volatility in currency
· Lack of latest technology, especially when compared to China
Major hand tool exporters
· GB Tools
· Ambika Forging
· Black Jack Tools
· HR Tools
· Oakay Tools
· Victor Tools
· Vishal Tools