Pune’s Chakan industrial area, which houses the manufacturing units of a number of big brands including Volkswagen, Tetra Pak, Bridgestone and Tata Motors, has been hit by rising incidents of extortion, threats and violence against the Indian and foreign companies operating there.

The intimidation has risen to such a level that German Consul-General Jürgen Morhard recently met the Police Commissioner of Pimpri-Chinchwad city seeking strong action against the underworld elements.

Chakan is the major auto and manufacturing cluster of Maharashtra. German car major Volkswagen and Indian automaker Mahindra and Mahindra are large landholders at the cluster. It is spread over 8,500 acres with 604 industrial plots. The area is developed by the Maharashtra Industrial Development Corporation, a State Government body.

Earlier, Chakan used to be policed by Pune rural police, but in the last one year, a new commissionerate of Pimpri-Chinchwad city has been formed, which is now responsible for law and order in the area.

Recently-appointed Police Commissioner of Pimpri-Chinchwad city, RK Padmanabhan, told BusinessLine that the German Counsul had met him about a month ago and had complained that the overall atmosphere in Chakan industrial area was not good, which is affecting the companies in the area.

Hiring affected

The companies are not able to hire manpower freely and control costs of certain inputs due to the presence of criminal elements in Chakan, which affects their operations. However, no complaints have been registered till date. The police can take action only when there is an FIR. But till date, no FIR has been filed, he said.

Padmanabhan held out the assurance that the police will soon take action even for smallest offences, which will help build confidence gradually in the law enforcement machinery. In some cases, the police will take suo motu action and FIRs could be initiated on charges of extortion, violence, violent threats, obstruction and other sections of the IPC.

Other than Volkswagen, Tetra Pak, Bridgestone, and Tata Motors, Japanese, Korean, French, Dutch, Chinese, British and Indian majors such as Horiba, Kubota, Hyundai, Lucas TVS, ZF India, Air Liquide, DMW Corporation, Philips, Mercedes-Benz, GM, Schindler, Foton and JCB have set up manufacturing units at Chakan.

A senior officer at the Ministry of Home Affairs told BusinessLine that since land is highly valued at Chakan for industrial, residential and commercial use, land mafia elements, supported by various political outfits, have proliferated in the area. It these elements that are extorting money and pressuring companies to recruit manpower identified by them. They also influence smaller contracts such as disposal of scrap. Scrap is a big-money spinner: deals of industrial scrap and discarded metals run into crores of rupees, the official said.

Meeting with officials

A statement from the German Consul-General’s office said the Consulate routinely liases with authorities. It noted that in the context of the round-table meetings between government officials and German companies that are facilitated by the Indo-German Chamber of Commerce, together with the Consulate, “factors of importance for German investors, including the recent subject of operational security, are regularly discussed. However, specific grievances are taken up by respective companies directly with the local authorities.”

A senior HR Manager at an Indian automotive giant at Chakan said rapid industrial development of the area had led to conflicts between local residents and “outsiders”. In the early 2000s, when the area started developing, local people sold their land for industrial purpose, but today they want jobs from the companies. But they are not qualified for the jobs available.

Companies that look beyond the locals for smaller jobs and contracts face their wrath, the HR Manager said.

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