The United Planters Association of South India has urged the Kerala Government to find out ways to neutralise the impact of the additional financial burden that has to be borne by the plantation industry due to recent wage hike.

UPASI President N. Dharmaraj pointed out that the wage increase is likely to impact the industry’s contribution to the state’s exchequer which is to the tune of ₹13,243 crore through the production of 67 million kg of teas, 68,000 tonnes of coffee, 5.65 lakh tonnes of natural rubber.

The wages for tea has been fixed at the rate of ₹301 per day, while for rubber and cardamom; the wage would be ₹381 and ₹335 respectively. In tea and coffee sector, the wage increase along with statutory benefits would result in an increase to ₹436 per day, while in rubber; the total daily wage including statutory benefits is ₹552 per day.

The present wage increase of 30 per cent plus in tea is the highest ever, the last one being 23 per cent when the plantation commodity prices were ruling high, he said.

At the present wage rate, he said the industry would incur huge losses besides drying up of credit avenues and in the process there could be delay in wage payments and some estates/companies may even default. Many plantations would be compelled to reduce the workforce to sustain themselves. All these would result in a permanent damage to this sector.

Already seven estates and 14 factories are lying closed. In the wake of this new additional wage increase, it is feared that more estates will close down leading to loss of employment and revenue, he added.

Plantations in South India are not against paying higher wages, but the current economic realities coupled with the plethora of taxes and levies, does not make it a viable proposition. The wages that is being forced upon, without considering the capacity of the industry to pay, will lead to the collapse of this sector, he added.

Kerala which is considered to be a plantation enclave growing all crops will soon lose its relevance, as the growing of plantations has turned uneconomic, he said.

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