Paper to pauper

  • Desperate measures: Sirpur MLA Koneru Konappa at Sirpur Paper Mill | K.R. Vinayan
  • Past glory: Sirpur Paper Mill.

With the closure of the Sirpur Paper Mill imminent, anger against the Telangana government overflows

  • The Telangana government is making some efforts to reopen the mill. PAPCEL, a Czech company, has shown interest in taking over the mill.

When the Sirpur Paper Mill was opened in 1942, it was among the largest paper mills in the country. It changed the life and landscape of Sirpur, a small town in Adilabad district of present-day Telangana, so much so that it was renamed Sirpur Kaghaznagar (the town of paper). However, today, a couple of years short of its platinum jubilee, the mill is looking at its imminent closure, spreading anxiety among thousands of workers and their families.

The mill, established by the Nizam, was taken over by the C.K. Birla group in the 1950s. In 2000, the Poddar group bought the mill, which was one of the largest manufacturers of variety and colour paper. At its peak, the six top-of-the-line machines in the mill produced 160 tonnes of paper a day. But mounting loans and a steady fall in production hit the company badly. In the last fiscal, it reported a loss of Rs 90 crore.

The management justified the loss and said paper mills across the country were doing badly. “The sharp hike in the price of raw materials has pushed us into the red. Moreover, the shortage of power supply has made paper production unviable here,” said a management representative. Many people, however, said mismanagement was to blame since paper industry in India had been growing over the years.

The factory has not been functioning since September 14, 2014, but the management is yet to declare a lockout or closure, leaving the workers in limbo. The future of 3,200 people (1,550 permanent workers, 1,150 contract workers and 500 allied staff) is at stake. They still report for work every day and punch their entry and exit, but their salaries are not being paid since September.

If the workers do not punch in their attendance, it would be treated as leave and they would not get their full salaries, if and when the company is reopened. But it means they cannot step out of town to look for a job. Racherla Anil Kumar, an assistant welder, now makes dust covers for television sets, ovens and other such equipment. His two daughters attend a local private school, but the school authorities have given them an ultimatum about paying their fees. The kids also want new sets of uniforms. Sujatha, Anil’s wife, still manages a smile. “We are hopeful that they will reopen the factory. The entire town depends on it.” The family has six tolas [one tola is 11.66 grams] of gold and it has sold one tola already to get through the difficult times. The family now survives on the 30kg rice they get every month under the food security scheme.


Even for those who are willing to work elsewhere, it is hard to find a job. Mill workers are paid only half the market rate as their desperation is well known. Other workers are also uncooperative as they think the mill workers will take away their jobs.

“We are used to living on a tight budget,” said a woman affected by the closure. “But no salary for the past ten months is taking its toll. We do not give milk to our children anymore. We cannot even afford vegetables. And, it looks like our children will have to join government schools,” she said. Last year, Sirpur MLA Koneru Konappa had helped collect Rs 32 lakh for paying children's fees. “This year, we have to pay more than Rs 60 lakh since it would be for the entire year,” he said.

The Telangana government is making some efforts to reopen the mill. PAPCEL, a Czech company, has shown interest in taking over the mill. JK Paper Mills and ITC, too, have shown interest. PAPCEL has requested the government for Rs 250 crore as grants and interest-free loans to settle a part of the outstanding liabilities. The mill has bank liabilities of Rs 800 crore, Rs 100 crore in statutory dues and Rs 90 crore as workers' dues. But the government has not responded to the offer. “If the government does not urgently play a proactive role in this matter, then the factory will be sold off to scrap dealers,” said a worker. The management is not very cooperative and has repeatedly failed to attend meetings convened by the government.

The women in Sirpur are much more vocal about their plight. “When the chief minister [K. Chandrashekar Rao] can spend so much money on something called Mission Kakatiya [a programme for restoring tanks and lakes] and on Haritha Haram [tree plantation programme], why can’t he give us Rs 3,000 per family, which, in any case, is rightfully ours?” asked a woman. This year, the summer was severe, adding to their already overburdened lives. “Is this what we voted for? Telangana came and we lost our jobs. This is not something we expected. The CM celebrates Telangana sambaralu [carnival], with expensive lighting, but we do not have food to eat. Are we not citizens of this state?” she asked.

While the employees of the paper mill are suffering, ancillary industries, too, are in a bad state. Besides, the milkmen and vegetable growers are being forced to look for new markets. But it is the transport companies which are the worst hit. Nearly 300 trucks are lying idle, forcing 600 families into poverty. Mohammed Afsar had two trucks, but after the mill was closed, he could not repay his loans and the financiers took away one truck. He could lose the second one anytime. “No one is showing any kindness to us,” said Mohammed Ghouse, who had three trucks. Financiers have taken away two of them. “They book cases against us when we protest,” said Shabbir Ahmed, general secretary of the Indian National Trade Union Congress.

Nayani Narasimha Reddy, who is the home and labour minister, was once the president of the powerful trade union, Hind Mazdoor Sabha. Mill workers said Reddy became the president of the HMS with their support. “Recently, he came to Bejjur, a neighbouring village, to inaugurate a police station, but he flew over this town by helicopter,” said Banagini Babu Rao, senior manager, fibre line maintenance. Such attitude has enraged the people. “Reddy has not visited us even once since we started the agitation. He has not done anything to stop the management from selling the land given by the government for the development of the mill,” said Eerla Vishweshwar Rao, general secretary of the HMS.

A relay hunger strike by the workers has crossed 200 days. When the idea was mooted first, 150 people joined the strike. But, the spirit seems to be broken, with barely one or two workers turning up for the strike these days. Not even the labour commissioner or labour officers have visited them. “We had dreams and we, too, fought for Telangana, but see what have we got for that,” said Babu Rao. Some of the hapless villagers are even ruing the setting up of the new state. Said an old woman, “If this is what Telangana is going to be, I would rather be part of Andhra.”

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