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Brick industry kiln owners in the Telengana district of India have come out, en masse, and admitted that demonetisation has had an adverse impact on construction activity

Demonetisation and its effects on real estate and construction activities has affected the brick industry badly, bringing it to a virtual standstill in the district. Since there were no takers of bricks made of either cement or soil, the kiln owners have sent away the workers who came from different States mainly from Maharashtra and Odisha.

The industry which recorded the downward growth till recently seems to have collapsed completely at present.

For the last two months, brick kiln owners have been sitting idle and wondering what to do.

No money in the hands of farmers and builders following the dry spell, crop failures, absence of remunerative price for agriculture produce, demonetisation and abnormal increase in material costs are attributed to the current plight of the brick industry. Earlier, we used to go round neighbouring States in search of workers and bring them to the kiln sites agreeing to their conditions. The industry used to be vibrant for 10 months in a year and closed only for two months during the rainy season.

Now, the situation is reversed. We ourselves are sending the workers back to their native places,” deplored R. Mallikarjun, owner of Vengamamba Cement Brick Works at Dichpally expressing no hope of revival of the industry in the near future unless construction activity picks up.

He says the cost of material that is dust and cement and coupled with electricity and labour doubled, resulting in bricks becoming costlier.

Apart from that, there is complete slowdown in the real estate business and construction industry, he adds.

There are about 80 kilns in the old district and at least 7 to 10 families are engaged in the work in each of these kilns.

The place was buzzing with workers, owners, customers and vehicles earlier but now they wore a deserted look.

In the latest of a long line of body blows, the impact of Goods and Services Tax also added to the sector’s woes as the industry was brought under the new tax regime.

“Progressive rate of tax is imposed on the industry for the sale of Rs. 50,000 and above. In addition they must be registered online. If they do not get registered they would be punished,” says Kotapati Narsimha Naidu who stopped the business some years back as he became active in politics.

Once again it seems a centralised, sweeping policy in India has threatened the very industries that helped build the sub-continent into an economic giant. How much longer can this be allowed to happen?

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