Industry estimates cost of Karnataka shutdown at Rs 5 billion

The dawn to dusk shutdown of Karnataka on Monday over the Cauvery verdict is estimated to have cost the State a whopping Rs 5 billion.

According to a study carried out by Federation of Karnataka Chamber of Commerce and Industry (FKCCI), the state had incurred a loss of over Rs 5 billion in trading as well as production.

President of FKCCI R C Purohit told reporters that the loss in trading is roughly estimated to be around Rs 2 billion while the production and manufacturing sector had run up a loss of Rs 3 billion.

The loss incurred by Agricultural Produce Marketing Committees (APMC) spread all over the state account for a major chunk of the trading losses. The losses would cover commodities like pulses, wheat, sugar, vegetables and vegetable oils, which had been brought to the State from outside and could not be sold on account of the shutdown.

The production or manufacturing loss refers to goods, which could not be produced or manufactured on the day of the shutdown. The sectors affected include apparel, engineering goods, electronic goods, steel, agarbathi and even the major public sector factories located in and around Bangalore.

However, Purohit said the worst hit by the shutdown were the small and medium enterprises, where work had come to a standstill. These small and medium enterprises take a longer time than major industries to return to their production cycle. “Production activity in these small industries will take two to three days to resume”, Purohit said.

“The trade and industry sector will have to wait for a couple of days for the normal climate to return”, said Purohit, who heads the FKCCI, which is the leading trade body in Karnataka.