November 24, 2016 2:20:44 pm
Two weeks after Prime Minister Modi’s demonetisation move banning Rs 500 and Rs 1,000 notes, it is the labour-intensive sector that is bearing the maximum brunt. There has been widespread loss of jobs in industries like textile, garments, leather and jewellery. Senior industry executives fear that post-demonetisation, more than 4 lakh people who are dependent on daily wages have been rendered unemployed. Of these, some have either lost their jobs or stopped working owing to lack of payment and production cuts.
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Industry executives warned that if the cash crunch continued, the number of jobless people will only grow. They, however, added that a clearer picture will emerge in the weeks to come when more cash is likely to be in circulation.
Production has been severely affected in the days following the sudden demonetisation move. Many factories have already reduced their production because of liquidity crisis. The cash withdrawal limit of Rs 50,000 a week helped the industrialists to conduct only necessary business transactions.
Besides, many labourers do not have savings account, says in hubs like Tirupur, as 70 per cent of them are migrant workers from the north and northeastern parts of the country. At the same time, a lot of workers do not use bank accounts because they risk losing poverty or BPL status if the amount in their saving account exceeds the limit of Rs 50,000.
Almost a fifth of 32 million people employed in textile and garment industries, who are paid their wages daily or weekly, have been severely hit. Around 25 per cent of the 25 lakh workers in labour industry have also been affected.
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