The wood industry in Kallai region – India, once regarded as a world leader in this domain, in going through a rough period. It threatens to extend all over this sector due to the complete shutdown of a large number of sawmills, because of the high taxes imposed by the government.
The disappearance of the sawmills from this region will affect not only the industrial sector but also the welfare of the 3000 families directly/ indirectly involved in this domain.
Between 1950 and 1960, the wood industry in the Kallai region was considered one of the most valuable in the world, the whole country depending on this sector.
“The decline started in 1970, when the suppliers couldn’t face the rise of taxes imposed by the government”, states the President of the Timber Merchants Association.
During the time the trees were brought from the neighbouring region of Karnataka, processed in the sawmills and send to various destinations all around the country, the producers felt the rise in taxes which had grown from 2% to 12, 5%.
The situation in commerce is so difficult nowadays, that only 50 sawmills are active Kallai, several are about to close and others area bout to become storage hangars for processed wood.
The locals can no longer afford to invest in this domain, especially because 1 of 7 cargos is taxable.
The president adds: “The government does not, in any way sustain the commerce for a while now making the trade hard to take place in a civil manner”. He notes that these taxes are not used in the development of this sector.
Timber Merchants Association has composed a demand addressed to the government demanding the auctioning of different types of wood, the moment trees reach a certain age.
Taking into account that even now there is a big demand for construction wood from cities like Mumbai, Pune or Tamil Nadu, Mr. President claims that urgent measures must be taken to insure the welfare of those involved in this domain.
“A large group of business men who take part in this domain are gradually losing interest because of the high cost required to maintain this kind of business”, declared K Ramesh, owner of a big timber company in the region. He adds: “Once 2-3 rupees were required to maintain a business, now it requires 10 times as much and still there is no guarantee that there will be a raise in the profit rate. There has been a huge request for acacia and kumizh wood, which could not be completed because there was no support from this government.” |
