Batala: An industrial hub once, now awaits revival

Never before in the history of mankind has the pace of innovation and technological acceleration been faster than it is today. In Batala, once known as the “Iron Bird of Asia” for its famed foundries, the reverse is happening. The pace of keeping abreast with industrial advancement has slackened to the extent where there is no forward movement at all.

The role played by cities like Batala, where the seeds of a mini-industrial revolution were sown in the pre-Independence days, in the development of Punjab cannot be undermined.

After Independence, commerce and trade in the city flourished. The King Midas touch was evident. People setting up factories saw their investments growing exponentially. Old timers recall that the concept of big-fat Punjabi weddings originated in the city. The town prospered till the late seventies when militancy engulfed the state. With violence, curfews came into play. This meant factories had to be shut for long periods of time. Industrialists started suffering losses and soon fell into the debt trap as Batala acquired the sobriquet of being a “hotbed of terrorism.”

Misguided youth created such a scare that industrialists downed their shutters and surrendered their licences. The Punjab Government, ostensibly to check insurgency, elevated Batala into a separate police district. The aimed at ensuring better police administration, but it was also an acknowledgement that things were indeed bad.

Later in 1992, then Finance Minister Dr Manmohan Singh abolished the Freight Equalisation Policy (FEP). The policy, adopted in 1948, resulted in the rapid growth of industry. Industrialists could buy raw material at subsidised rates.

The policy’’s withdrawal meant the cost price exceeded the selling price of goods manufactured by units located in the vicinity of steel plants and coal mines. Batala industrialists were now swimming with the sharks.

Entrepreneurs started shifting base to Jammu and Kashmir, Himachal Pradesh and even southern states because of “better business environment”.

The city could no longer compete with the best in business. To complicate the matters, the Union Government formulated a policy in which subsidies were offered to industries set up within 30 km from the International Border. Unfortunately, just 10 per cent of the city fell within the ambit of this scheme. Units in the remaining 90 per cent area struggled to maintain competitive rates in the absence of sops. Parmjit Singh Gill, president, Industrial Estate Factories Association, said the 30 km distance should be increased to 50 km. “This move can prove a goldmine as we can get exemption from GST and electricity duty,” he said. There are many like Gill who want this to happen, but the Union Government just doesn’’t listen.

Data from various sources reveals the stark reality. There were nearly 2,000 industrial units in Batala in 1980. The number has come down to 250-300. Of 550 firms manufacturing farm implements, just 120 are left in the business. Handtool units have been wiped off the map. Manufacturers of sports goods, galvanised pipes, conduit pipes and aluminum doors and windows are gasping for breath.

The Railways too has not been kind to Batala. Businessmen have to first send their products to Amritsar, 40 km away, before these reach other parts of India. This surely eats into the profit margins. The problem can be easily solved if the Qadian-Beas railway link is constructed.

“The pace at which units are closing down means the city may well become a haunted town. For the last three decades, it has been registering a negative growth rate,” said Ravinder Handa, a prominent businessman and general secretary of the Industrial Estate Factories Association.

Remedies are definitely available, but it needs the cooperation of both the state and the Centre. Vinesh Shukhla of Batala unit of Laghu Bharat Udyog said, “We need tax concessions on the lines J&K and Himachal. Defence industrial corridors, too, are required to be established.”

Batala industrialists also want the Centre to come out with a comprehensive package for units located near the border. “This will not only benefit Punjab, but also states like Rajasthan and Gujarat. We understand the FEP cannot be brought back, but there are other routes through which we can move forward,” said Parmjit Gill.

The city once boasted of top industrial units. Many of them like Khalsa Foundry, Macro Foundry, Sarabjiot Machine Tools, Kumar Engineering and Neelam Iron Foundry have shut down. Their owners have invested in other cities where the business climate is much more conducive.

Besides, stiff competition from Chinese and Korean imports came as another shocker. Till the late seventies, the town had a monopoly in farm implements and allied machinery like lathes, shapers and chaff-cutters, but the import of foreign machinery hit the local industry real hard.