Dunlop India Sahagunj Production to Restart Following Electricity Agreement

Dunlop India’s Sahagunj factory may actually resume production following a settlement over electricity payments between the Ruia Group company and the West Bengal State Electricity Distribution Company. Ruia Group management has agreed to provide a bank guarantee to the power supply, who in return will resume supply. Should Dunlop India be able to successfully follow through with the funds, approximately 900 workers will return to their jobs a month after production at the company’s Ambattur factory recommenced.

“I have decided to submit a bank guarantee of Rs 1.6 crore (£2.05 million) next week, preferably Monday itself,” Pawan K. Ruia, chairman of Dunlop, told Calcutta based newspaper The Telegraph. The Ruia Group had previously intended to supply the power provider with a Rs 5.38 million (£69,000) letter of credit, however differences in opinion over the letter of credit’s terms prevented this option from being taken further.

The newspaper reports sources within Dunlop India indicate the bank guarantee was approved on November 6, and company management is now confident that production of OTR and truck tyres plus belts and hoses can start within weeks of the electricity supply’s reconnection.