Hosur MSMEs launch two-day strike; want new costing norms to be implemented

Around 3,000 Micro, Small, and Medium Enterprises (MSMEs) in Hosur on Wednesday launched a two-day strike demanding that large companies that take supplies from them implement the new common costing norms and pricing policy.

Representatives of the MSMEs submitted a memorandum to the sub-collector, listing their demands. The entrepreneurs demanded that the large companies who take supplies from them increase the price of their products by taking into consideration the rising price of raw materials and the labour charges.

Hosur Small and Tiny Industries Association (HOSTIA), which is organising the protests, came up with new costing norms for sheet metal pressing and welding, CNC and conventional machining, rubber, and plastic components based on the assessment of prevalent costs of inputs.

However, the company refused to implement the new norms, HOSTIA said, adding that the rising raw material prices have posed new challenges as they were already suffering from higher taxation and Covid-19 lockdowns.

“The worrying fact is that MSMEs are not given the fair price and profit for their products and job orders by the corporate customers over the last 15 years despite a multifold increase in investments and expenses like land and building cost, machinery cost, labour, consumables, and overheads. These have been totally overlooked and not taken into consideration at all,” K Velmurugan, President, HOSTIA, said.

He said that nearly one lakh people involved in the day-to-day manufacturing activities are participating in the strike during which the production loss is expected to be Rs 500 crores. Velmurugan also demanded that the government convince corporates to accept the “fair costing norms” arrived at by HOSTIA.

Over 3,000 MSMEs, a majority of which manufacture automobile components, form the ecosystem for large companies that have set shop in Hosur, 40 km from Bengaluru.

Hosur is fast emerging as a hub for electric vehicles and electronics with the Tamil Nadu government making efforts to bring companies from the sector to set up their units. Ola, Ather, and Simple Energy are some of the EV firms that have built massive facilities in and around Hosur, while Tata Electronics and Delta Electronics have also invested huge.