WHO IS GOING TO RUN THE FACTORIES?

about 3 months ago
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Raghu is an entrepreneur and he runs a small size company which manufactures parking systems – those grid looking structures in most redeveloped buildings where cars are stacked and parked. It’s a perfect business model for Mumbai which has a space crunch and such parking systems work very well in old buildings being newly made while roads and congestion around remains the same.

He was doing very well, having employed 25 people and cash flow pretty much remained smooth. His order book was robust and he started designing, manufacturing and installing his own structures. He now has two factories and they both had good orders to see his company through for the next 6 months at least.

Then the virus struck and everything, Raghu’s entire life now seems to have come unhinged. He cringed and bore the costs for a month but now as the lockdown continues, he is in despair and he is unable to pay salaries. Yesterday, as some parts of the country eased the lockdown, his two factories, located near Nasik could actually begin work, while following the social distancing norms. Raghu was all for it and called up his factory workers to get ready to once again work. But to his dismay 75% of his factory workers said they were going back home as they wanted to be with their families. Raghu had provided food and shelter for his workers but yet, they wanted the security and safety of their own home. With states now allowing workers to go back to their homes, mostly migrated from UP and Bihar, two-thirds of his labourers were leaving.

Raghu is ready to start the factory as allowed by the Govt but he has no labour. He does not know when these workers will come back or if they will ever come back. He cannot find others simply because borders across states are closed and no one can migrate to work even if they want to.

This is the predicament of not just Raghu but most of the factories all around him – there simply are not enough people to work. And they all are staring at a scenario where labour will not be available for the next 2 months at least.

This story of Raghu might seem very small in the bigger picture of things but looking ahead, as we head towards easing of lockdown, even by month end, this small or micro irks are what will pull down the macro economy. The supply chain is completely broken and there is simply no way to mend this.

The migrant or the faceless crowd of people are what make this economy run. Today they are gone and it is vast emptiness in factories. Even the mid and larger factories are facing exactly the same situation. And that’s why we reiterate again, this migrant problem has been completely mishandled.

The workers should have been sent back, like the way they are being done now, way back by end-March or early April at least when the lockdown began; if that had happened, they would have been ready to come when the lockdown starts easing. Instead they are going now when factories might restart.

So all those who thought that the migrant problem has been solved, people like Raghu tell us – it has just begun!

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