Russia-Ukraine war, rising inflation casts shadow on industrial belt

Automobile sector mostly affected by the shortage of semiconductor chips

VAIBHAV PARWAT

Aurangabad, May 7:

The industrial belt that was running three shifts in April has slowed down due to soaring prices of various raw materials and fuel due to the Russia-Ukraine war and rising inflation in several countries. More than 1,000 industrial units at Waluj, Shendra and Chikalthana have been affected. The automobile industry is specially hit as it is facing severe shortage of semiconductor chips and base metals.

Steel, exported mainly by these two countries, is the worst hit as its price has soared by as much as 30 per cent. Ukraine and Russia are amongst the major chip exporters globally. According to the industrialists, while Russia supplies the semiconductor industry with important metals such as palladium, Ukraine supplies special gases such as Neon and Helium which are required for chip making. As the ongoing war between Russia-Ukraine escalates, the semiconductor industry is facing a massive brunt, with chip-dependent sectors such as the automobile and the IT sectors getting hit badly.

According to CMIA president Shivprasad Jaju, amid the ongoing Russian-Ukraine crisis, the prices for base metals and various gases required by the automobile sector have surged 10 times, which has potentially impacted the manufacturing of automobiles in the State. The industries suffered badly with 50 per cent reduction in shifts as the automobile exports have fallen drastically. Many industries have discontinued the third shift.”

No control over fluctuations

Massia president Narayan Pawar said that businesses were badly hit by the ongoing war. Fluctuations in the industries is not a new phenomenon but this time there is no control over it. There is no clear picture as to how long this crisis will persist. Small units are facing a capital crunch as they have stopped receiving orders from large companies. The conflict in Europe has dashed our hopes. The automobile and project-based industry is especially impacted in a major way.

Bajaj Auto lowers production

According to sources, the ongoing war in Russia-Ukraine, bankruptcy of Sri Lanka and rising inflation all over the globe has had a direct impact on the industrial area. Bajaj Auto has also decided to reduce its production as demand for auto rickshaws from neighboring countries, including Sri Lanka, has stopped, announcing two days off a week.