Financial Daily from THE HINDU group of publications
Tuesday, Oct 26, 2004
Industry & Economy
Tie-up with ITC heralds better times for match units
Kolkata , Oct. 25
ADVERSITY need not always be a bad thing, as at times it goads you to achieve greater things in life. Sivakasi Nadars, known today for their immense contribution to the fireworks and safety matches industry, inherited a dry, unyielding land where no pure agricultural activity of substance could be sustained for a long period.
Undeterred, a group of Nadars took off to British Calcutta to pick up the secrets of match-making from Bengal Lights.
And thus was born the handmade safety matches industry of Sivakasi and its neighbourhood towns of Kovilpatti, Sathur and Srivilliputhur.
Many of the agricultural families in the Sivakasi belt switched to match-making, and emerged winners.
Today they provide direct and indirect employment to thousands of people in the region.
They also extend all statutory benefits to their employees.
The resourceful Nadar families fought off the dry belt conditions, and established the match units (both handmade and semi-mechanised) in the small scale and cottage sectors, attracting big corporates such as ITC. The company sources bulk of its requirements from companies such as Hind Matches, Liberty, Sundervel, Kumaran, Galaxy & President, Bilal, Pope and more.
Prosperity has come to the region because of this contractual relationship with ITC.
Says Mr Janarshanan of Galaxy: "The production contract with ITC takes care of 40 per cent of the raw material costs, besides ensuring regular supplies of outer and inner boards, including side-friction boards, and high quality packaging material. Galaxy has three units, employing some 450 women for frame-filling and box filling jobs, earning on average at least Rs 40 per day."
Galaxy's annual turnover is said to be round Rs 14 crore, out of which Rs 9 crore is on account of the new contract-manufacturing tie-up with ITC.
The company also deposits around Rs 25,000 per annum towards the labour welfare fund.
According to Mr Noor Mohd of Bilal Matchworks and Bilal Offset, which produces high quality matches for both marketing under its own brand name, and also for ITC, besides printing the outer labels, the association with ITC has brought rich rewards and jobs for many more.
"In fact, we have the work, but not enough people for employment, as other attractions such as TV keep the women indoors these days." According to him, the company deploys its buses to fetch the women workers from far off villages.
A major problem faced by the cottage match manufacturers in the Sivakasi belt has been that of raw materials shortage, coupled with a steep increase in their prices.
Says P.K. Nadar of Kumaran Matchworks in Srivilliputhur: "While the cost of Kerala matti (for making sturdy match splints) has shot up, the cost of potassium chloride too has gone up substantially.
He said a medium-sized unit like his needs an average of 5 kg per month of potassium chloride, besides wax and sulphur. Among the other inputs used are red manganese and glass powder.
"I have been able to overcome bulk of my raw materials costs problem because of the association with ITC, which takes care of 40 per cent of the costs."
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