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Morbi: Battling cash crunch, ceramic units look at increasing exports

This move comes at a time when over 25 percent of the ceramic units in Morbi have shut shop due to demonetisation.

By: Express News Service | Ahmedabad |
December 14, 2016 1:41:09 am

Faced with an uncertain domestic real-estate market in the wake of demonetisation, a number of ceramic units in Morbi — the hub of ceramic industry in India — will be using the next couple of months to explore the possibilities of increasing their exports by setting up warehouses in countries such as Vietnam, Sri Lanka, Dubai, Oman, Latvia and Madagascar. This move comes at a time when over 25 percent of the ceramic units in Morbi have shut shop due to demonetisation.

In order to facilitate the setting up of warehouses in overseas locations, the Morbi Ceramics Association and its partners will be signing about 11 memorandum of understanding (MoUs) at a pre-Vibrant event — Vibrant Ceramics Expo and Summit 2016 — that will be held at Sabarmati River Front between December 16-18. This list of “strategic MoUs” include, Dubai Chamber of Commerce and Industry, Ministry of Interior Affairs and Decentralisation-Government of Madagascar, Oman Chamber of Commerce and Industry, Vietnam Chamber of Commerce and Industry, Indo-Latvian Chamber of Commerce and European Asian Chamber of Commerce, Adani Ports & SEZ.

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“This event has been organised so that it can help us increase our exports at a time when the domestic market has been affected by demonetisation. About 25 percent of our units have shut down due to cash crunch. A number of these closed units are using this time to conduct their annual maintenance work. We expect that once the situation improves after December 31, these units will restart,” said K G Kundariya, president of Morbi Ceramics Associations. The association represents India’s biggest ceramic cluster which accounts for exports worth Rs 4,200 crore.

“By setting up warehouses in overseas locations, we can cater to the requirements of even smaller buyers in the respective countries and thus improve our export volumes,” Kundariya told mediapersons Tuesday. The ceramic industry is desperately looking towards exports at a time when the domestic real-estate market is seeing a 43 percent dip in business in just one month after demonetisation.

Over 126 firms and 200 brands will be setting up stalls at the venue. “Ninety-five percent of them are from Morbi. These firms will be looking to divert a portion of their domestic supplies to these countries. At present, it’s difficult to estimate the quantum of volumes that can be diverted to the export market. However, if this situation continues, then in the next six months, many more units will shut down (in Morbi),” said Nilesh, joint-president of Morbi Ceramics Associations.

The Morbi Ceramics Associations is offering three-night complimentary accommodation in a five-star hotel for all foreign guests and will also be bearing all costs of conveyance, meals and sightseeing. Till now, over 225 foreign delegates from 22 countries have confirmed their participation for the event that will also have wax statues of Prime Minister Narendra Modi and Sardar Vallabhbhai Patel.

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