Chinese products are cheaper and technologically superior, suited to the consumer’s needs, say Indian manufacturers.
A fireworks shop in Chandni Chowk on Thursday. Indian manufacturers say that the outdated xplosives Act, 1884 is stopping them from innovations that are required to compete with Chinese crackers.
Chinese fireworks are entering India illegally through Nepal to eat into the Rs 1,500 cr domestic market. Though there is no credible information on the magnitude, industry insiders say that Chinese fireworks worth around
Rs 100 cr are circulating in the Indian market and the volume could increase if remedial steps are not taken.
Fireworks are classified as explosives in India and are governed by the outdated “Explosives Act, 1884”. The Act imposes many restrictions on the industry, making it harder for domestic manufacturers to compete with the Chinese. “Chinese products are cheaper and technologically superior, suited to the consumer’s needs. For example, we are not allowed to use potassium chloride, which adds colour and height to the fireworks. But China uses it in a big way. Similarly, potassium perchloride is banned in India, but used in China. We are living in the kerosene-era, whereas China is in the CFL-age,” said J. Tamilselvan, president of the Sivakasi-based Indian Fireworks Association. The Association represents 650 odd factories, contributing to 90% of India’s total firecrackers production.
Tamilselvan said that the government needed to understand that fireworks were not explosives and should relax the restrictions at least during Diwali. “Moreover, we cannot manufacture fireworks after evening. There is no research and development (R&D) activity,” he rued.
Manufacturers say that the process of manufacturing fireworks should be fully mechanised in order to compete globally. “The government should bring in a new Fireworks Act, which can lift our products to global standards,” said Mohan Minocha of National Traders, a leading distributor of fireworks in and around Delhi.
The Indian Fireworks Association has written to the Ministry of Commerce saying that the industry can fetch $5 billion in the next five years if the rules are amended. The letter says, “The fireworks industry has huge export potential provided the government relaxes shipping norms in all ports. At present there are heavy restrictions and bans in many ports to export fireworks. China, on the other hand, dominates the global market with a much more liberalised shipping policy.”
The skyrocketing prices of raw materials such as barium nitrate and potassium nitrate are increasing the prices of local firecrackers, making it harder for domestic manufacturers to compete with the Chinese.
“The sale of fireworks should be liberalised as consumer products. The Explosives Act should be modified by exempting traders from obtaining licences to sell firecrackers. The government should set up a Fireworks Development Board for the overall growth of the industry,” demanded Minocha.
The fireworks industry employs around 1.5 lakh people and provides an additional 3 lakh indirect jobs.