MYSURU: US President Donald Trump’s punitive tariff imposed on Indian goods has severely affected the granite industry in Karnataka. Container loads of goods headed to the US have piled up at the Chennai port now.
Though the tax imposed on granite is 10%, there is a fear among quarry owners that it could go up further after a three-month stoppage on tariffs announced by Trump to allow countries to negotiate with the US.
The production has now been affected in around 50 black granite quarries in Chamarajanagar district. Quarries in Khanapur, Kalaburagi, Bagalkot, Bidar and other districts too have either stopped or slowed down stone extraction. This will cause a big hole in the state exchequer as quarry owners pay Rs 7,000 as tax per cubic metre. Each quarry produces 100-150 cubic metres of stones per month. Of this, 70-80% material is exported, running into approximately Rs 10,000 crore.
Quarries in Jothigowdanapura, Udigala, Nanjapura and surrounding areas in Chamarajanagar contain the best-quality black granite, which is used in monuments and as tombstones. It is sold for a minimum of Rs 1.3 lakh per cubic metre.
Sreenath of SVG Granite said they export an average of 25 containers to Europe, the US and the Middle East, and 25% of the material that is to be exported to the US is stranded at the Chennai port.
He said they are negotiating with their clients in the US as the new tariff will cause a loss of Rs 1.5 lakh per container to the company. Containers take around 35-40 days to reach the US and the clients feel the taxes could go up further after the 90-day hiatus, he said.
He said they have to now sit across the table and renegotiate the deals, sharing the tax burden equally between the company and the clients.
A few other exporters felt the Union commerce ministry should hold talks with its US counterpart to protect the interests of the industry.
District Granite Owners Association president GM Hegde said the tariffs have cast a shadow on the demand.
He said that the US’s punitive 125% tariff on Chinese goods will stop Chinese companies from buying granite from India and exporting it to countries across the world. Though the domestic demand has picked up, it is not enough to sustain the industry. Material worth crores has piled up in quarries, he revealed.
Hegde said owners have invested crores on equipment. Any closure of quarries or slump in their business will affect the livelihoods of thousands of labourers across the state. Many exporters are now waiting and watching the developments, and they will decide their future moves after the three-month tariff break.
The state is known for its high-quality granite, which is exported to Europe, the Middle East and the US. The production and supply was smooth all these years, except during the Covid years and also for a while after the war broke out between Russia and Ukraine.
