Firecracker industry fears Rs 1,000 crore, massive layoffs after SC ban


The Supreme Court ban on the sale of firecrackers in the Delhi-National Capital Region (NCR) during the Diwali season has caused significant distraught to the firecracker industry and shopkeepers as they are staring at losses to the tune of Rs 1,000 crore.

Firecracker firms in the town of Sivakasi in Tamil Nadu which supplies 85 percent of the total firecrackers sold in the country are worried as other states might emulate the Apex Court’s order.

Tamil Nadu Fireworks and Amorces Manufacturers association president Asai Thambi told HT, “Diwali is the time we make maximum profits and the SC order will completely smash many units.” We cause pollution only for a week at best, but vehicles pollute the city 24×7 all 365 days. What about that?”

The town of Sivakasi is fearing massive job loss due to SC decision as around 300,000 workers are directly employed by the firecracker manufacturing units and another 500,000 are engaged in related industries such as packaging, printing, paper rolling transportation and others. The estimated turnover of the firecracker industry is worth around Rs 7,000 crore.

While firecracker vendors in the wholesale market of Sadar Bazar and Jama Masjid in Old Delhi fear losses in the hundreds of crores as they have stocked up crackers of all kinds in the range from Rs 20 up to Rs 1,000 and more for the festival period.

Amit Jain, a shopkeeper in Jama Masjid, said that all dealers in firecrackers in the National Capital Region will be impacted by the SC decision which would continue till October 31. About 500 short-term licences have been issued to sell firecrackers in Delhi-NCR by the authorities, said Harjit Singh Chhabra, head, Sadar Nishkarm Welfare Association, apart from the permanent licence holders.

For many traders it is a double whammy as they were already impacted by the 28 percent GST on cracker and stocks they have piled up for the festival seasons will go waste.

The bench headed by Justice AK Sikri had on October 6 reserved its order on a plea seeking restoration of the apex court’s last year order banning the sale of firecrackers in Delhi-NCR. The court had said that it wanted to evaluate the difference to air quality.

Now the trader lobby has pinned its hope on big manufacturers in Sivakasi to get a stay on the Apex Court’s order.