The garment exports units in Gurugram are facing severe financial crisis issue due to a shortage of skilled labour and increase in the cost of materials.
Due to this, unemployment has reached its peak in the city. In April, a 20-year-old garment export unit closed down in Udyog Vihar Phase -4. Around 250 workers lost their job. There are more 800 garment export units in the city which employ over 1.5 lakh workers.
Owing to such issues, the foreign buyers are now heading to markets like Bangladesh and South East Asia. Owners highlight that the margin of profits for most of the units in the city have reduced to 40 percent.
Shortage of skilled labour and rising infrastructural costs are resulting in losses of smaller garment export units that are unable to meet the production standards of newer markets.
In their heydays, the products of these units were exported to markets like France, Germany and USA. The garment export units along with the auto ancillary units and Information technology firms have been a source of growth for small scale medium enterprises in the city.
"Compared to other business units there are lot of regulations that are imposed on us. Not only do we have to meet various standards set up by the labour department but there are also lot of impositions set up by the pollution control department. In times when most of the exporters need to invest in the growth of their export units, most of us are bearing losses of rising production and infrastructural costs, "said Satyendar Singh, one such owner.
He also stated that the government must come forward and aid in the growth of garment export units. "With the competition from export units from Bangladesh and South East Asia only increasing many of the garment export houses in the city will lose out," he added.
According to Pradeep Yadav Head Gurugram Udyog Association, "The units reeling under shortage of skilled labour, production costs have also increased. In this case, the government must ensure that there is subsidised infrastructure provided to these units. Not only is the infrastructure costs in the city high, it is also inadequate," he said.