GROWTH OF INDUSTRIES

CChhaapptteerr 33

GGRROOWWTTHH OOFF IINNDDUUSSTTRRIIEESS

3.1 Favourable factors 3.2 The Major companies launched include 3.3 Milestones in the march of Industrial

Growth of Travancore

Cont

ents

Growth of Industries

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Alwaye occupies a prime place in the industrial map of Kerala. As

and when industries began to concentrate in Kalamassery, the industrial

belt of Kerala began to be known as Kalamassery Industrial Belt instead

of Alwaye Industrial Belt. However now almost all the industries,

numbering about 301, are concentrated in the Eloor-Edayar region,1 and

hence the industrial capital of Kerala is identified as Eloor, which is

under the Eloor Municipality.

3.1 Favourable factors

The major reason for the growth of industries in Eloor/

Udyogamandal is its unique geographical features.2 The most significant

among them is the availability of pure water from the river Periyar. The

initial phase of the industrial growth in Eloor/Udyogamandal required a

huge volume of water because industrial technology was based on

steam.

The second factor is the feasibility of water transport and the direct

accessibility to the Cochin port. Eloor/Udyogamandal is an island

surrounded by the Periyar, geographically an elevated area, free from the

normal floods with close proximity to the Cochin port.

The third is the density of population was very low during pre-

industrial times. The acquisition of land was easy and a major portion of

the land where the companies are housed today belonged originally to

the Kingdom of Travancore. At that time in 40.5 percentage of Eloor

1 Dr. C.M.Joy & Prof. S. Seetharaman, op cit., p. 117 2 Eloor Panchayath, Nineth Five Year Plan Development Report 1996, p. 6.


81

paddy was cultivated, 18 percentage rubber and cashew estates, 29.5

percentage uninhabited and 11.5 percentage residential area.3

The fourth is the availability of electricity the prime factor which

compelled the authorities to start industries in Eloor. Power is the

imperative need of industries. The Government of Travancore was

looking for avenues so that the surplus electricity generated from the

Hydro-Electric power from the Pallivasel could be put to good use. The

Government of Travancore was very eager to find or start new ventures

for effective electricity utilisation. With this end in view, the Diwan in

his personal capacity contacted and invited the Canadian Company M/s

Al Can to start an industry in Kerala.4 The Canadian company accepted

and agreed to start an industry and the site was identified. This resulted

in the birth of M/s Al Can Company in Eloor.

The fifth factor is the primary impulse originated from the travails

of the Bengal famine of 1943, which wrought many deaths in Bengal.

The reverberations of the calamity were also felt in far off Kerala. Along

with this the acute scarcity of food, the aftermaths of the Second World

War, which crippled the major sources of supply of food from Burma

and Thailand _ on account of Japanese occupation _ forced the

Government of India to look towards increasing the food production.5

The famine and the War opened the eyes of the Government of India

3 Eloor Panchayathh, Janakeeyaasuthranapadhadi, 1996, p. 15 4 M. Venugopal, Eloor muthal Udyogamandal vare ,(Mal) Fact News Vol 18, No.4,

1984, p. 10. 5 Paul Pothen, Memoirs FACT-The Early Years, FACT News, Golden Jubilee

Special, p. 28.


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about the urgent need of increasing indigenous food production and

revamping the agricultural sector. In response to the vision of the

Government of India, the King of Travancore and his Diwan, Sir C.P

Ramaswamy Ayyar, thought about an indigenous chemical Ammonium

Sulphate fertiliser factory in Travancore, which was felt as a crying need.

Another factor is the availability of timber from the Malayattoor

forest and the easiest mode of transportation through the Periyar

compelled the authorities to begin the FACT in Eloor in tune with the

recommendations of the Gowing Commission, Government of India.

Fortunately the kingdom of Travancore under the reign of Sri

Chitira Tirunal Bala Rama Varma, took the lead in the generation of

electricity in Kerala. With this idea in mind a dam was constructed

across the river Periyar (Muthirampuzha) viz., Sethuparavathipuram

Dam for ensuring sufficient water supply for the generation of electricity

in the Pallivasel Power House.6 The first venture of this kind was named

the Pallivasel Hydro-Electric Power Project. For this purpose, under the

guidance of the Diwan, a three kilometre underground tunnel was

constructed and for the remaining length, cast iron pipe was laid for the

supply of water from the dam to the Pallivasel Power House. The

installed capacity of the power house was 37.5 MW but it can produce

only 32.5 MW. The water from the Kundala Dam and Mattupetti Dam is

used for the generation of electricity in the power house. The first power

house for the distribution of Electricity was built at Kalamassery, close to

6 Broadcast talk given by Sir C.P Ramaswamy Ayyar K.C.I.E on Travancore from

Bombay Radio on Sept 27, 1936 cited in Travancore State Manual, T.K Velupillai, p. 543. Also see, M.Venugopal, op cit., p. 8.


83

Eloor. All these factors prompted the authorities to set up the factories,

one after another, in Eloor region.

3.2 The Major companies launched include

The Standard Potteries/Standard Stoneware and tiles in 1919 at

Companipadi in Alwaye (the first in this venture), Union Tile Works in

1921 at Chengamanad in Alwaye, The Canadian Aluminium Company/

Al-Can in 1939 at Kuttikattukara in Eloor, The Fertilisers And Chemicals

Travancore Limited (FACT) in 1944 at Udyogamandal in Eloor,

Travancore Cochin Chemicals (TCC) in 1950 at Udyogamandal in Eloor,

Indian Rare Earths Limited (IRE) in 1951 at Udyogamandal in Eloor,

The Hindustan Insecticides Limited (HIL) in 1954 at Udyogamandal in

Eloor, etc.

3.2.1 Sundaram Clay and Ceramics

On analysing the genesis of industrial progress in the Alwaye

Industrial Belt, reference should be made to the first and pioneering

factory that was started in this location, on the banks of Periyar, i.e., the

Sundaram Clay and Ceramics in 1919 under the ownership of Mr.

Sundaram Mudaliyar from Bangalore.7 The company was later renamed

Standard Potteries or Standard Stoneware and Tiles. ‘Standard Potteries’

became a significant brand in Kerala because of its diversified products.

This factory is also commonly known as the Balakrishnan Company.8

The first product of the factory was the roof tiles and later many other

products were produced like the stone-ware pipes, decorative roof tiles,

7 Sundaram Clay and Ceramics, First Annual Report for the 1919, p. 2. 8 Payyappilli Balan, Alwaye Trade Union Prasthanathinte Aadiyanalukal (Mal), p.21.


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floor tiles, the kurudies, the decorative wall tiles, glass-packed roof tiles

and chimney roof tiles. All these products have stood the test of time

and age. This factory, based on German technology, was started in the

pre-hydro-electric era of Kerala.

At the beginning stage human energy was used for running the

machinery instead of electric power. This was the first factory to employ a

large number of people (about 2000 directly and 800 indirectly). The

company caused a paradigm shift in the region. Sprawling on 21 acres of

land, the company received generous support from the Travancore Raja, His

Highness Sri Mulam Tirunal Rama Varma. A push for social revolution

was imparted by this factory with the start of two schools: The Standard

Potteries Lower Primary School in 1921 which was handed over to the

Government in 1927. The Company started Standard Potteries High School

in 1927.9 These two schools became the centres of learning and provided

the nucleus for the new cultural ethos in and around Alwaye. As per the

records of the school, it is to be pointed out that in the period between 1960

and1972, the school functioned on ‘shift scheme’ due to the large

enrolments exceeding its capacity. The Register of Admission shows that

2400 students regularly attended classes. These schools gave ample

opportunities to the children of the work force of the company and the other

children of the society of the lower castes. Thus, these schools became

instrumental in the growth of a new culture, and at the same time, they paved

the way for a social renaissance even before the independence. The Company

functioned smoothly under the custodianship of Mr. Sundaram Mudaliyar

9 Standard Potteries High School, First Annual Report of the School for the 1927, p.1.


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from 1919 to 1972. It is said that during 1969-71 many labourers resigned

from the FACT and joined this factory due to the attraction of salary and

other benefits.10 The Company management introduced many labour-welfare

programmes like supply of rice, firewood, kerosene, clothes, umbrella and

educational allowance in its first stage of growth i.e., from 1919-72. The

secret of the success of the factory in its first progressive phase was the

cordial relationship between the management and the labourers.

But this healthy relationship was short-lived due to the differences

between the entrepreneur and the workers. This compelled the workers to

unite under the banner of the labour trade unions. The management was

forced to sell the factory, and it was sold to Mr. Velayudhan, the chief

Executive of the Sundaram Chitty Funds. Under the second management

the workers did not find a peaceful atmosphere. This new situation led to

frequent strikes. Eventually, the management had to close down the firm on

31st December, 2002 due to labour problems. This was the death-knell of

the factory.11 The factory was again sold to the Shilpa Construction and

Builders in 2004, and now just two chimneys are left as the remains of the

age old Sundaram Clay and Ceramics. The factory through its changing

fortunes formed a new perception among the working class about the need

for socio-economic adaptability and unity in times of crisis.

3.2.2 Union Tile Works 1921

The second venture in this direction was undertaken by the eminent

Malayalam poet and industrialist Shri. Kumaranasan. Though he is

10 Standard Potteries, Annual Report for the 1970, p. 3. 11 Standard Potteries, Annual Report for the 2002, p. 4.


86

known to the world as a poet, his vision of industrialisation was

accomplished through a tile factory at Chengamanad named the ‘Union

Tile Works’ in 1921, near his wife’s house. Initially it was a partnership

venture of four members but later on it fell on the poet’s shoulders and

became his own enterprise. Though his original intention was to

construct a factory at Alwaye near the Alwaye Palace, he foresaw the

possibility of pollution of Periyar and decided to purchase land on the

banks of the Periyar at Chengamanad for the construction of the factory.

The proposed factory land of Alwaye was donated to Sri Narayana Guru

for constructing the Advaida Ashram. Soon, a tile factory near Alwaye

(Chengamanad) functioned under the ownership of the poet. Alongside

championing a literary revolution, he brought about another revolution in

the mode of the construction of houses. With the beginning of the tile

factory, the nature of the construction of houses thoroughly changed

from thatched leaves to roof tiles. Unfortunately, the resourceful

leadership provided by the poet came to an abrupt end by a boat accident

in the Pallanayar (Thonnakal) in 1924 which took his life. But his wife,

Mrs Bhanumathiyamma (Asatti) was determined to continue the factory

and she ran it for a long period till her death in 1976.12

3.3 Milestones in the march of Industrial Growth of Travancore

The history of industrial growth of Travancore was initiated during

the reign of Sri Chitira Tirunal Bala Rama Varma (1931-49) with the

help of the Diwan of Travancore, Sir C.P. Ramaswamy Ayyar. Many

12 Dr. T. K Ravindran, Asan and Social Revolution in Kerala, p. 22. Also see, Interview

with Pradeepkumar (cherumakan of Asan)16th June 2013 Mathrubhumi, Varandhapathipu, p. 1.


87

major industries were started in the Kingdom.13 Apart from the industrial

growth, the Kingdom of Travancore also witnessed the introduction of

several salutary administrative and social reforms. A Public Service

Commission was appointed in 1935 in order to ensure fair representation

for all communities in appointments to government service on the basis

of communal rotation.14

Many major industries were set up in and around the Alwaye

Industrial Belt. The hydro-electric power generation at Pallivasel was the

real start to the development of the industries of Kerala.

M/s Al-Can was the first modern company in the Eloor region.

With this company, even the place-name Kuttikattukara came to be

known as Alupuram. The major industries like Aluminium Production

Company of India or The Indian Aluminium Company or Hindalco at

Edamula/Kuttikattukara in Eloor, The Fertilisers And Chemicals

Travancore Limited at Udyogamandal, Ogale Glass Factory at Kalamassery

13 K.R Rajan, Keralathile Vyavasayangal,(Mal) Vol.I1, Kerala Bhasha Institute

Trivandrum,1987, p. 2. & Kerala State Large and Medium Industries Directory, 1967, pp. 12-13.

1)The Paper Mill, Punalur. 2)The Cotton Textile Mill, Kollam. 3)Travancore Titanium Products, Thiruvananthapuram, 4) Travancore Rubber Works, Thiruvananthapuram. 5)Travancore Ply woods, Punalur. 6)Travancore Cements, Nattakam, Kottayam. 7)Forest Industries Travancore at Companipadi, Alwaye. 8) Aluminium Manufacturing Company of India at Edamula/Kuttikattukara-Eloor. 9) Travancore Electro-Chemical Industries, Chingavanam, Kottayam. 10) Travancore Ogale Factory, Kalamassery. 11)The Ceramics Factory, Kundra. 12) The Starch Factory, Kundra. 13) Travancore Rayons, Vallam, Perumbavoor. 14) Sree Chitira Mills, Kalamassery and 15) The Fertilisers And Chemicals Travancore Limited, Udyogamandal etc

14 A Sreedhara Menon, A Survey of Keala Histroy, DC Books Pvt. Ltd. Kottayam 2008, p. 273.

1)The Legislative Reforms Act of 1932-33, 2)The Travancore Land Mortgage Bank in 1932, 3)The Temple Entry Proclamation of 1936, 4) the establishment of Travancore University in 1937, 5)The Travancore Village Unions Act in 1939, 6) the introduction of the State Transport Services, 7)the birth of the Travancore-cochin State etc


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(now non-existant), Travancore Cochin Chemicals etc were started after the

commissioning of the Pallivasel Hydro-Electric Power house in the

Kingdom of Travancore. After the formation of Kerala State (Aikya

Keralam) on 1st November, 1956, other industries like Hindustan

Insecticides Limited and Indian Rare Earths Limited were also started in

Eloor.

3.3.1 Al Can/Aluminium Production Company of India/Indian Aluminium Company/HINDALCO

The birth of this company has been considered as the stepping stone

of the Industrialisation of Kerala. The King of Travancore, His Highness

Sri Chitira Tirunal, provided all help for running the industry at

Kuttikattukara, three kilometers away from Eloor. This Industry became

operational on 6th March, 1943 as the Aluminium Production Company

of India. With this industry in Kuttikattukara, Eloor; the area around the

factory came to be known as Alupuram and spurred the growth of a new

industrial culture which later on spread all over Kerala.15

For encouraging the industries, the Government of Travancore

supplied electricity to the company at a lower rate and it was fixed as one

and a half paisa per unit. In the beginning stage, this company employed

600 labourers and the capacity of the plant was 25KA. There was an

extrusion press where the company produced incuts, billets and coils of

aluminium. The company consumed about 18 units of electricity for the

production of one kilogram aluminium. The capacity of the extrusion

plant was increased to 1250 tons in 1955.

15 Ibid.


89

In the initial phase, the common people were reluctant to be

recruited due to very high temperature in the furnace, smoke in the

premises and low salary. Due to the low salary and poor working

condition, the workers resorted to collective demand, which was the first

step in the direction of the formation of a trade union. The first success

of the trade union was the implementation of the ‘Three Years

Agreement’ in 1956. However, it must be mentioned that there was no

medical support to the labourers in the company.16

The Company decided to expand and increase the production from

25KA to 50KA by installing another extrusion press in 1961. For this

purpose, the company decided to acquire 150 acres of land. The local

public protested against the acquisition and organised a public strike in

Alupuram. A Land Acquisition Samrakshana (protection) Samithi was

constituted which demanded higher price for the land and protested

against the smoke coming from the factory.17 In 1961-62 the strength of

workers increased from 600 to 1300 and there was a considerable hike in

the salary. The second extrusion press, having the capacity of 3300 tons,

was installed in 1961. Both the presses put together, the production

capacity was at around 12000 TPA. Over the years, the old equipments

were upgraded and some outdated parts of the plants were replaced.

There has been no major expansion plan since 1961. The Dye Shop,

which is attached to the extrusion plant, has a production capacity of

16 Payyappilli Balan, op cit., p. 71. Mr. T. V Thomas and Mrs. K.R. Gauri were the leaders of the Samithi and finally

the company decided to collect the land at the rate of ` 80/- per cent and also agreed to give employment to the land holders.

17 op cit., p. 73.


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manufacturing 720 dyes per annum. The cast house, which is attached

to the extrusion press, formerly part of Alupuram smelter, caters to the

need of the aluminium billets for extrusion press. The major raw

material used in extrusion process is aluminium billets and dye steel.

Homogensied aluminium cut billets of 6 inch; 9 inch and 12 inches

diameter have been supplied from two sources since December 2004. As

per the requirements of the extrusion plant, the billets are either collected

from Renukoot plant, U.P or manufactured at Alupuram Cast house. The

dye steel used for making dyes is mainly imported or procured through

Indian agents. In the extrusion process, a block of solid aluminium metal

is converted into a continuous length of uniform cross section by forcing

it to flow in the solid state itself, under high pressure through a dye,

which is so shaped as to give the required form to the product.

The billets are usually manufactured from 97% pure aluminium

with different alloying elements to give strength and finishing

properties.18 The two major types of extrusions include solid shapes like

a simple channel of complex heat sink and hollow shapes like a simple

tube or a complex gear. The significant markets for extrusions produced

at Alupuram Works are for the building and construction segment,

industrial segment, electrical components, appliances, defence and

transportation industry. The majority of extruded products are sold to

Indian customers and a sizeable quantity of extrusion is exported (nearly

20%) to overseas customers in various countries. There are various

testing equipments and a quality assurance-in-charge support for

18 Hindalco Industries Limited Summary, p. 2. Also see, Company’s Plant Profile, p. 8.


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analytical requirements for the purpose of process and product quality

control. The major customers are L&T, VSSC, LMW, Siemens, ABB,

GEI Hamon, MICO, ALSTOM and Eicher.19

At present Alupuram company is a part of HINDALCO Industries

Limited which is a flagship company of Aditya Birla Group. Aditya Birla

Group was chosen as “the best employer for the year 2007” in India.20 It

has two extrusion plants. The main plant is in Renukoot, U.P where six

extrusion presses are operating, whereas there are only two at Alupuram.

At present, the Alupuram plant employs only 300 labourers due to the

change of the ownership and the impact of globalisation.

With the beginning of this company, the King of Travancore

decided to start a new chemical fertiliser company near the Aluminium

Company, which led to revolutionary changes in agriculture.

3.3.2 The Fertilisers and Chemicals Trvancore Limited (FACT)

The Fertilisers And Chemicals Trvancore Limited (FACT) was

started on 14th August 1944. It was Sir C.P Ramaswamy Ayyar who

conceived the idea of putting to productive use the geographical

advantages, Alwaye/Eloor possessed in the form of hydel power, wood

(for gasification), water resources etc., for setting up a pioneer chemical

fertiliser plant.21 Without improving the agrarian sector, India could not

withstand another famine. Food was in short supply and the problem

was aggravated by the loss of Burma and crisis created by the Second

19 Ibid. Also see, Company’s Plant Profile, p. 11. 20 Ibid. 21 op cit., p. 29.


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World War. More food mean more agricultural production, which

required fertilisers. There was only one nitrogenous chemical fertiliser

production unit existing in the country producing ammonium sulphate in

Belagulla, in the erstwhile state of Mysore, with a capacity of 4000 tons

per annum which was negligible compared to the vast requirements of

the country. By the advice of the Gowing Commission, the Government

of India thought of producing fertilisers on a large scale culminating in

the great enterprise at Sindri Fertiliser plant in the coal belt of Bihar.

Kerala, ever at a deficit in the matter of food, could think of a unit

of a smaller scale. All the steps were initiated by the Raja His Highness

Sri Chitira Tirunal and State Government of Travancore headed by

Diwan, Sir C.P Ramaswamy Ayyar. The Government had started two

important prestigious institutions: State Bank of Travancore and the

FACT.22 The recommendation of the Central Government was to make

India self-sufficient in food production. Due to the tragedy of Bengal

famine, prime importance was given to promote agriculture with the

installation of a fertiliser factory in the state. Those were the days when

people thought of investment in small numbers. Corresponding to this

was the initial proposal for a Superphosphate plant in Kundara.

Land was acquired and a building built. But the findings of Gowing

Commission highlighted the need for producing maximum ammonia,

based and nitrogenous fertiliser. Taking the recommendations of the

Gowing Commission, an Ammonia plant was proposed, based on the

timber sources of the Malayattoor forest. This change of plan required a

22 Mathrubhumi daily (Mal), Friday, 23rd April, 2010, p.19


93

change of location. Alwaye had been marked as one of the locations for

industrial development. However, Aluminium Manufaturing Company

of India/Indian Aluminium Company had been established in Eloor

Island in1939, which was surrounded by the Periyar. The availability of

land, water and electricity decided the location of the new venture. The

great industrial location of Udyogamandal was thus born in the place

called Nedungattukunnu as the locals called it.23

The Diwan invited Shri.V. Seshasayee, the chief of Seshasayee

Brothers Limited, a Managing Agency Company with proven record,

including a caustic soda plant in Mettur, to set up a fertiliser plant in the

state.24 The earth work was started on 28th May, 1944 with a 16 member

team.

The pioneers of the Factory had a dream25. The fourth dream _ ‘Fact

a household name’ _ is yet to be materialised. Along with this, the

pioneers also visualised a township in Udyogamandal. Many fortunate

circumstances prevailed in the country at that critical time. Under the

leadership of Seth Walchand Hirachand, the Hindustan Aircraft had

been established at Bangalore. This project was taken up with the active

involvement of an American entrepreneur, Mr. William Pawley who was

instrumental in building this industry in China for the Chiang Kai Shek

government. When the Chiang Kai Shek’s government finally fell, Mr.

23 T. P Chandranpillai, Nedungattukunnum parisaravum Udyogamandalamaya Katha,

(Mal) FACT DAY 1984-Special Number, p. 9. 24 S Natarajan, Down the Memory Lane, FACT News Letter Vol.18, No.4, 1984, p. 3. 25 ‘Fact is always the fact….Fact is the first name in the field….Foremost name in

chemical fertilisers… Fact a House hold name’.


94

Pawley and associates were looking for other opportunities and

Bangalore had become the venue. The theatre of the Second World War

had shifted to the Pacific and India became a major supply base. The new

military presence prevented the American entrepreneur from his effort at

Bangalore.26

This was the time Shri. Seshasayee got in touch with Mr. Pawley

who in the typical American attitude of ‘can do’ agreed to investigate the

proposition. An Industry whose known base was either natural gas or

gas made from coke by the water gas process was introduced with

firewood as raw material. The power Gas Corporation of Stockton-on-

Tees, UK, as a party well versed in the gasification technology, was

brought in as a partner in the overall scheme. Mr. Pawley also brought in

as specialist consultant, Mr. Charles Owen Brown, former chief Engineer

of the Nitrogen Engineering Corporation. To coordinate the entire

operation, Mr. Pawley founded the Intercontinental Corporation and

collaborated with Singmaster and Breyer Consultant based in New York.

All drawings and consultations took place in New York and Stockton

when the Second World War was going on. This was itself a pioneer

step for the Indian industry.27

26 S Natarajan, op cit., p. 29. 27 The Intercontinental Corporation’s Indian operations were headed by Mr. Edward

Pawley and Mr. L.C Mc Carty (Jr) vice presidents. The Management structure of FACT on the Corporation choice was Mr. H.G. Felio, General Manager and Mr. George L. Giles, Deputy General Manager. They were supplemented by Prof. Subha Rao, Head of specialist staff. The five departments were 1) Finance headed by Shri. T. Velupillai, 2) Purchase headed by Shri. N. Sundarem, 3) Construction and Erection headed by Shri. V. N Kasturirangan, 4) Personnel by Shri. T. Thomas and 5) Engineering by Shri. D. V Nagaraja Rao. The last person was under contract for architectural design work.


95

The site selected for the project was an extensive area which

comprised the original Udyogamandal plant site, the area presently

occupied by the Indian Rare Earths Ltd and Travancore Cochin

Chemicals Ltd. (original site was added to subsequently by purchase and

acquisition). The site had an extensive waterfront since it was known that

the large quantities of raw material _ fire wood, gypsum and sulphur _

would have to be unloaded. To start with a railway siding was

anticipated, but unfortunately has not materialised till today. FACT

remains one of the few major industrial sites without a railway siding in

the country. The initial idea of the Diwan was that the presence of the

industry should not disturb the population distribution and lifestyle of the

locality. Now the surface road connecting Vallarpadam International

Trans-shipment Centre passes through Eloor, close to FACT. As of now

there is a new proposal of railway siding with the industrial belt crossing

the Container Road near the gypsum yard.

The condition of the workers of the industries at its beginning stage

was beyond the imagination of the new generation.28The facilities

available were almost zero and the workers had to travel on foot the

distance from Alwaye. A floating bridge was constructed across the

Edamula Ferry with the co-operation of Indian Aluminium Company, by

28 The workers had to work from 7 A.M to 7 or 8 P.M and Over Time (OT) wages

were not heard of. It would be a revelation to the present day employees that the workers had to undergo all these hardships for a ‘princely’ salary of `30 to ` 45 per month for a clerk and `75 for an officer. Even these emoluments were not regularly paid for about 8 to 9 years up to 1958. Since August 1955 salary was paid on fortnightly basis. Still, the company had undergone severe financial crisis and often some officers like Shri. Velupillai, Shri. K.A Varghese, Shri. B.V.D Menon and sometimes even the contractor Mr. Pareedkutty had to advance money from their pocket to the company.


96

tying 2 or 3 changadams- aptly named ALCO-FACT bridge- was a

bonanza offered to the commuters. Nevertheless, this bridge was meant

for light vehicles, and barring the very top officials who had cars, the rest

continued to travel on foot the distance. As most of the officers and staff

stayed at Alwaye, the distance was covered by water transport, towed by

a motor boat, ‘Padmini’. The construction of the Pontoon Bridge across

the Manjummel Ferry eased the transportation problem to some extent,

and people could travel in luxury in covered trucks, with benches

provided inside. The employees shared the space with bulk materials

transported in the same trucks. Meanwhile construction of the permanent

concrete bridge was completed connecting Kalamassery and Kuttikattukara

(Eloor) and it was inaugurated by Mr. K.I. Velayudhan, the Minister of

the Public Works Department of the state of Thiru-Kochi in 1955.29 It led

to drastic changes in the mode of transportation which resulted in smooth

transportation of raw materials and machinery on one side and the

transportation of the manufactured products on the other. With the

opening of the new bridge at Kalamassery on 14th November, 1955 the

pontoon bridge and ALCO-FACT were dismantled. Till 2010 this

concrete bridge played a prominent role in the development of Eloor and

the major industries. Since all the top officials of the construction of the

factory were the officials of the Aircraft industry, they used to travel in

aeroplanes. The first airport in Kerala was built in Eloor by the

American officials for their easy movements and the flight of aeroplanes

was a regular sight for the Eloorians.

29 P. M Unnikrishnan, Oru Yathrayayappinte Ormakal, (Mal) FACT DAY 1984-

Special Number, p. 19


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The main Administrative Block of the factory was inaugurated on

1st December 1945 by His Highness Marthanda Varma, Elaya Raja of

Travancore.30 The first chairman of the company Shri. Gopalaswamy

Iyangar welcomed His Highness to the function. Later, in early 1947, Sir.

C.P Ramaswamy Ayyar was brought to see the first crystals of

Ammonium Sulphate coming out of the plant. On commencement of

commercial production in 1948, the plant was inaugurated by Dr.

Rajendra Prasad, Minister for Food and Agriculture, Government of

India. We have seen over the years, the adjectives like ‘first in the field’,

‘foremost name in fertilisers’, and ‘synonymous with fertilisers’ aptly

applied to FACT to signify its evolving status in the society. From ` 44

lakh sales turnover in 1948 the company reached ` 13,506 lakh in 1982-

83, Rs 1200 crore in 1995-96 and ` 2100 crore in 2009.31

FACT, thus became the training ground for a number of people

who later made their mark in the Indian fertiliser industry. FACT was

also the pioneer in trades like welding, where a training programme was

conducted under an experienced welding foreman, the result of which is

still felt at construction sites around the country. Within a short duration,

the construction work was completed i.e., from November 1945 to May

1947. With the commencement of production in 1947, FACT earned the

distinction of being the first large scale producer of Ammonium Sulphate

in the country. Its unique position in the industry is due to the fact that it

is the only unit ever to have used firewood as raw material. Wood

30 op cit., p. 4. 31 FACT, Annual Reports for the year 1982, p. 23; 1995, p. 17. Also see, FACT,

Annual Reports for the year 2009. p. 21.


98

gasification became uneconomic and the decision of FACT to replace it

with naphtha reforming process as part of their expansion plan was

indeed a wise step.32

As part of the diversification of the FACT in 1948, a new Super

Phosphate plant was constructed, and production started. Due to the

diverse needs of caustic soda, a new firm, the Travancore Cochin

Chemicals was started in Eloor under the state ownership in 1949. The

first phase of the expansion of FACT was started in 1956 immediately

after the Aikyakeralam Movement, and was completed in 1960. A

milestone in its first phase was that the Managing Agency of the FACT

wound up in 1960 and that it was converted into the State Public sector.

The last three years of the Managing Agency’s administration could be

evaluated by the following production table.

Table 3.1 The Last three Years of FACT’s production under Managing Agency

Year Ammonia Amm. Sulphate Amm. Chloride Profit Estimate

Capacity Prodn (tones)

EstimatedCapacity

Prodn (tones)

Estimate Capacity

Prodn (tones)

Rs

1958 12,000 12,524 45,000 33,319 8,000 6,636 41,04,426

1959 ,, 10,103 ,, 29,412 ,, 5,348 50,28,518

1960 ,, 13,537 ,, 39,813 ,, 6,064 53,27,695 Source: FACT Finance and Production Department.

The Government of Kerala took over the FACT from the Managing

Agency on 15th August 1960 and appointed Meppally Krishnan Kutty

Nair as the Managing Director.33 Its growth and development was

32 FACT, Annual Report for the year 1985, p.32. 33 S.C.S Menon, FACT yesterday, today and tomorrow, FACT DAY 1984- Special

Number, p. 10.


99

spectacular after it became a public sector undertaking. The Government

of India became the major shareholder of the FACT. The production of

fertilisers began to increase: the Production of Ammonia increased from

120 tons to 240 TPD, Ammonium Sulphate from 300 to 600,

Ammonium Phosphate from 100 to 400 and Ammonium Chloride from

25 to 75. Under the headship of Meppally Krishnan Kutty Nair, a new

diversification programme was started which resulted in FACT

Engineering and Designing Organisation (FEDO) on 24th July, 1964,34

FACT Engineering Works (FEW) which started on 13th April, 1967,35 &

Caprolactum Project of FACT in the Cochin Division in 1973.

The different stages of the growth and development of the FACT

under the public sector can be seen in the following table:

Table 3.2 Stages of Growth

Stages of Growth Period of Growth First phase of Growth 1960-61 Second phase of Growth 1962-63 Third phase of Growth 1965-67 Fourth phase of Growth 1971-72

The third phase of the growth witnessed the investment of capital

by the Central Government which automatically rendered it a Central

Government Public Sector. The major share of the company is owned by

the Central Government and the minor by Kerala and Tamil Nadu

Governments. The actual architect of the FACT was Meppally Krishnan

34 R.V.S Mony, FACT’s Engineering Services, A Brave New Tomorrow FACT DAY

1984- Special Number, p. 70. 35 Ibid.


100

Kutty Nair who was the Managing Director (1960-70), and he became

the Chairman during the period 1970-71. In June 1971 he retired from

the Chairmanship. The Cochin Division of FACT, the second production

unit, was set up at Ambalamedu and the first phase was commissioned in

1973 and the second, in 1976. In 1983-84 the Central Government gave

the sanction for the caprolactum project. The caprolactum is the chemical

product which is the basic requirement for the production of nylon

thread. It is the second in India in the production of caprolactum.

During the seventh plan, FACT envisaged a new project to build a new

Urea Plant and Mixture fertiliser plant. The FACT set up 900 TPD

Ammonia Plant at Udyogamandal at a cost of 638 crore following an

order of the High Court of Kerala in February 1994.36

The FACT has given outstanding support and help for the

development of the culture, literature, sports and games. In 1965 An All

India litterateurs convention, organised by the M.D. Meppally Krishnan

Kutty Nair was conducted in Udyogamandal. In his address he asserted

that only when the cultural and literary values flourish in society,

industries can attain the zenith of production without tampering the eco-

system. The man behind the scene of the cultural development of the

workers was K Pushparaj, the Executive Director of marketing.37 In 1966

the Lalithakala Kendram under the auspices of FACT was inaugurated

by the famous film actor late Mr. Sathyan. The Lalithakala Kendram

became the centre of cultural, literary competitions of Kerala like All

36 B Unnikrishnan, FACT’s Milestones, FACT News, Golden Jubilee Special 1994, p. 4.

37 K Pushparaj, From White House to FACT House, FACT News, Golden Jubilee Special, p. 59.


101

Kerala Drama Competition, Meppally Krishnan Kutty Nair Memorial

Mohiniyattam-Bharathanattiyam Competitions, Drama Workshops and

All Kerala Painting workshop. The Udyogamandal Kathakali Troupe

was formed under the FACT and it became a sought after troupe not only

in India but also abroad. The FACT has given many talented

personalities to the society.38 It has made significant contributions to

Malayalam literature by promoting writers.39 Many opportunities were

given to the employees for the improvement of their artistic talents. It

also promoted other important giants in arts and culture.40 The efforts to

promote art and culture helped to change the existing cultural paradigm

of Eloor. From its genesis to 1960 it has been the life _ line of 2400

families directly through employment, and indirectly of many more by

fulfilling the needs of many agriculturists, nurturing Kerala’s and other

southern states’ agrarian sector.

FACT has a commendable record in the field of sports and games

as well. It has promoted a large number of players who found a place in

38 Important Kathakali artists who served in FACT were the following; Kudamalloor

Karunakaran Nair, Chalakudy Nambeesan, Kalamandalam Karunakaran, Kalamandalam Kesavan, Kalamandalam Sankaran Embrandiri, Kalamandalam Hyderali, FACT Bhaskaran, Sankara Warrier, Smt. Kalamandalam Sugandhi, Smt. Kalamandalam Chandrika and so on.

39 Mr. P.K Nandanar, Mr. E.M Kovoor, Rajarajavarma, Mr. T Padmanabhan, Sathrughanun, and Mr. O.P Joseph.

40 The play wright Mr. K.S. Namboothiri, the poet Mr. Thazhathedam Raghavan Nair, Novelist Mr. M Gopinathan Nair, short story writer Mr. Rajamani, Mr. Pala Ramachandran, Narayana pillai, Mr. B Mohanan, Smt. Jayalekshmi and Mr. Melvin the architect of the FACT Music Band, Mr. T. M. Abraham, Mr. K.S.Namboothiri, Mr. G.S Pillai, Mr. E.M. Kovoor, Mr. Nandanan Mr. P.K Rajarajavarma,Mr. P.S Warrier, T. Padmanabha Menon, M. Gopinathan Nair, Mr. O.P Joseph, Thazathedam Raghavan Nair, Kalamandalam Kesavan and so on


102

the state and national teams.41 Briefly, the employees along with their

work in the factories also excelled in various types and levels of

competitions, establishing high benchmarks in the sports arena.

Divisions of FACT

Udyogamandal Division: FACT has mainly two divisions for production

viz., Udyogamandal complex (UD) and Cochin Division (CD). The

Udyogamandal complex is again divided into Udyogamandal division

(UD) and Petrochemical division (PD). FACT commenced its production

at Udyogamandal with the commissioning of 50,000 TPA Ammonium

Sulphate plant in 1947. In the decades that followed, multi stage

expansion programmes were undertaken bringing in the latest

technologies of the day, which were quickly mastered and successfully

implemented. Today the division is mostly a synthesis of 35 years old,

small capacity plants and 2 years old, state-of-the-art of technology

plants. The latest addition to this unit is 900 TPD Ammonia complex set

up with an investment of ` 642crore. FACT Udyogamandal Division is

14001 certified.42

41 N.M Prabhakaran, Kayikalokam Factinu Kathortha Nalukal (Mal) FACT

News,Golden Jubilee Special, p.169. Mr. T.D Joseph, popularly known as Pappen, from the FACT, was a member of the

Indian team which won Silver medal in the Asian Games held at Jakarta in 1962. He has also won several international awards. Another important name is the Footballer Mr. Simon Sunder Raj, who led the Kerala Football Team to won the Santhosh Trophy held at Kochi in 1973 and also the Indian team in the Nehru Cup. Under the captaincy of Mr. T.K. Subramanyan (also from the FACT) the Kerala Team won the Santhosh Trophy. The other important football players from FACT were Captain Mr. John J. John and Mr. M. O. Jose, who represented India in the Asian Youth Football Championship. In the shuttle tournament Miss. Norin Paduva represented India in the Uber cup International tournament. In Wrestling Championship Mr. John Bennet from FACT, represented India and won the third position in the international championship held at Calcutta in 1980 and won the title of ‘Mister FACT’ in the same year.

42 FACT Annual Report for the year 2007, p. 3.


103

Departments of the FACT: The factory works with the help of 12

departments. The important departments of the FACT are the following:

1.Human Resource Department, 2.Training Department, 3.Marketing

Department. 4.Finance Department, 5.Production Department, 6.Quality

Control Department, 7.Research and Development Department, 8.

Transportation Department, 9.Materials Purchase Department, 10.Safety

Department, 11.Computer Service Department and 12. Vigilance

Department.43

Plants at Udyogamandal Division: i) Ammonia Plant: - The capacity

of the Ammonia plant is 900TPD and 90TPD for synthetic gases. The

investment for the plant was about ` 618 crore.44 The main raw materials

required are Hydrogen and Nitrogen. Hydrogen is obtained from

naphtha, acquired from BPCL. There is also a captive power plant which

enables continuous power supply. There are 52 technicians, 18 officers,

12 helpers working in this plant under the process-engineers and

operators.

ii) Ammonium Sulphate Plant: This plant has a capacity of 680 TPD.

This is also a by-product of caprolactum which is manufactured in the

Petrochemical Division. Here, there are 46 helpers and 25 operators.

iii) Factamfos Plant: FACTAMFOS is a chemical fertiliser which has

Nitrogen, Phosphate, Potassium and Sulphur in the ratio 20:20:0:13. The

major components required here for its production are Ammonia,

Sulphuric Acid and Phosphoric Acid. But Ammonia and Sulphuric acid

43 FACT Department Manual, p. 3. 44 FACT Annual Report for the year 2009-10, p. 12.


104

are now replaced by Ammonium Sulphate liquid, which is a by-product of

caprolactum. There are 2 plants of capacities 300 TPD (commissioned in

1966) and 150TPD (commissioned in 1972). They are 24 hours working

plants with an annual functioning of 330 days. FACTAMFOS is the

premium product of FACT. There is also an in-house Phosphoric Acid

plant of 100 TPD, but due to the scarcity of the raw material rock

phosphate, it does not function. The production from the 300 TPD and

150 TPD plant comes to around 850 tons and 350 tons respectively,

which is 200 per cent above the expected efficiency. There are 37

process operators, 70 helpers and 20 engineers in the two plants.

iv) Sulphuric Acid Plant: The sulphuric acid plant is designed to produce

1000 TPD of Monohydrate. The plant is based on the double conversion,

double absorption process and was designed by FEDO in collaboration

with Davy Power Gas Plant. The plant produces 200 tons of oleum and

400 tons of Sulphuric Acid. It supplies the sulphuric acid to the

petrochemical division for the production of Sulphur Dioxide. There are

two control rooms with four operators and one helper and also 10 plant

engineers.

v) Petrochemical Division: FACT Petrochemical Division is one of the

two manufacturers of caprolactum in India. They have strictly adhered to

documented quality systems. In February 1996 FACT Petrochemical

Division was certified to ISO 9002 (1994) and ISO 14001 (1996).45 This

prestigious certification was conferred by RWTUV, the Reputed German

Quality Audit Firm. In 2009-10, the production and sale of all products

45 FACT Anuual Report for the year 1996-97, p. 8.


105

have shown substantial increase despite abnormal increase in raw

material prices and its limited availability. The company’s overall

performance in 2009-10 was greatly affected by the sudden increase in

the prices of key raw materials, especially sulphur and naphtha in the

first two quarters of the financial year and global recession in the last two

quarters. The raw materials used are phosphoric acid, naphtha, sulphur,

rock phosphate, benezene, ammonia, cyclohexane, caustic Soda, and

sulphuric acid. The factory aims for a better future by introducing

changes in the working pattern.

Switch over to LNG: The Company has drawn up plans for switching

over of feed stock for the Ammonia plant and fuel for the boilers and

complex fertiliser plants to LNG as and when the LNG terminal comes

on_ line at Kochi. The required modifications of the switch over of feed

stock are planned for completion by April 2011. The company expects to

reap the benefits of a lower LNG price compared with naphtha to

generate profit in its existing plants. The availability of LNG would also

improve the viability of the new ventures planned by the company.46

Very recently the LNG connectivity has been established and FACT will

be highly benefitted.

New Urea Plant: FACT intends to put up a new Urea Plant with a

capacity of 5 lakh MT pser annum at Udyogamandal as an addition to the

existing capacity of 900 TPD Ammonia plant. The estimated cost for the

project is ` 695 Crore. This project is targeted to be functional by the

time LNG is available in Kerala by 2011-12. The work of the LNG is

46 FACT New plans and policies 2007, p. 14.


106

fast improving and no doubt it will be supplied by the end of 2012 but it

was permitted only in August 2013.

Revamp of the raw material storage and handling system at Wellington

Island: To cater to the receipt and handling of larger volumes of raw

materials to meet the requirements of the proposed expansion/revamps, it

will be essential to refurnish the present facilities at Wellington Island.

This would include replacement of the old conveyor systems, improving

the dust handling facilities, increasing the number of barge unloading

points and the replacement of the grab type ship unloader with modern

continuous type ship unloader. This will improve the unloading rate of

bulk raw materials like sulphur, rock phosphorous etc., from the present

average of 3000 MT per day to 10000-15000 MT per day. This would

provide substantial economic benefits to the company in the form of

reduced freight by way of facilitating the handling of larger shipments.

The estimated cost for these modifications will be around ` 70 crore.

These schemes are proposed to be ready by 2011-12.

Expansion of caprolactum production capacity: FACT intends to expand

the production capacity of its caprolactum plant by 1,00,000 MTPA

utilising the low sulphate route. The Ammonium Sulphate production after

the expansion will remain at the current levels of 2, 25,000 MTPA. The

project envisages meeting the additional requirements of cycloheaxanone,

partly through the revamp of the existing anone plant and partly through

imports. The estimated cost of this project is ` 750 crore and it will

increase the turnover of FACT by ` 800 crore.47 The possibility of

47 Ibid.


107

reviving the earlier techno-commercial interest shown in this venture by

the process licensor M/s Stamicarbon will be explored again.

Outlook for the future: On completion of all these projects and

implementation of the Vision Plan for the next five years, FACT will

become profitable on a sustainable basis. The profitability will increase

substantially after FACT is able to switch over from naphtha to LNG as

feed stock. FACT expects to achieve 100% increase in its present

turnover and profit during the next five years.

From a modest beginning, FACT has grown and diversified into a

multi division/ multi-function organisation with basic interest in the

manufacture and marketing of fertilisers and petrochemicals,

Engineering Consultancy and Design and Fabrication and Erection of

Industrial Equipments. The mission of FACT is to become a market

leader in fertilisers and petrochemicals and a significant player in all its

other business including engineering and technology services, providing

maximum customer satisfaction and reasonable reward to shareholders,

adhering to business ethics and professionalism with adequate concern

for the community and the environment.

During the year 2009-10, the production and sale of all products

have shown substantial increase despite abnormal increase in raw

material prices and its limited availability. The Company’s overall

performance during the year 2009-10 was greatly affected by the sharp

rise in the prices of key raw materials especially sulphur and naphtha in

the first two quarters of the financial year and global recession in last

two. The performance of the company during the first quarter of the


108

financial year 2009-10 shows a loss of ` 3451 lakh as against the profit

of ` 112 lakh during the corresponding period of the previous year. The

loss during the first quarter of 2009-10 was mainly on account of the

annual turnaround carried out during April/May 2009 and the lower level

of operation of caprolactum - Ammonium Sulphate Plants due to the

shortage of Benzene.

However, even in this tragic situation the company is operating

above 90% capacity utilisation. The management and its staff are putting

in their best to sustain the company. The trade unions are cooperating

with the management, well_ aware of the company’s situation and

responding to its need. The future looks bright when the opportunities

and strengths of the organisation are considered. FACT’s real strength is

its experienced employees who have witnessed the different stages of its

growth. Further, it tries to acquire new technology for cutting the cost of

production. The Government’s new policy on subsidy may rescript the

history of FACT.

3.3.3 The Travancore-Cochin Chemicals Ltd (TCC)

The FACT, the mother industry in Eloor, prompted the authorities

to start a new industry for the supply of hydrogen chloride needed for the

production of chemical fertilisers. It was started by the technology

supplier of FACT, M/s Mettur Chemicals and Industrial Corporation,

also known as Seshasayee Brothers, prominent industrialists of South

India. The FACT set up an ammonia plant in 1950 for the production of

chemical fertilisers. They wanted to produce ammonium chloride which

required hydrogen chloride. Hydrogen Chloride is the product of Chlor-


109

Alkali industry (an industry simultaneously producing Chlorine and

Alkali). Since FACT was purely a fertiliser industry at that time, they

thought of installing a Chlor-Alkali unit adjacent to their factory

compound as a separate company.48 As a result, FACT formed a joint

venture along with their Technology supplier M/s Mettur Chemicals and

Industrial Corporation. The joint venture was registered in 1950 as

Travancore Mettur Chemicals (TMC). The TMC gave an order for a 20

TPD (Tons per Day) caustic soda plant. However, since it was post

World War II period, TMC could not raise sufficient funds to purchase

the equipment. Knowing that a Chlor-Alkali plant was coming up at

Udyogamandal, for utilising the Chlor-Alkali products for further

processing, two other companies, viz., M/s. Hindustan Insecticides

Limited and M/s. Indian Rare Earths Limited, started setting up their

plants at Udyogamandal. The TMC management intimated their financial

problem to Travancore-Cochin State government. The government studied

the problem and understood that if TMC could not complete their project,

two other companies, viz., HIL and IRE and one major plant of FACT

would become dysfunctional. In order to avoid a crisis, the state

government extended large scale financial assistance to TMC and became a

stakeholder. As a result the company was renamed Travancore-Cochin

Chemicals (TCC), in 1951.49 Today, the Travancore-Cochin Chemicals is

a state_owned public sector undertaking under the Government of Kerala.

On the parameters of quality, commitment and excellence, TCC has a

48 Travancore Cochin Chemicals, Rasavani,The House Magazine of TCC Ltd 1998,

p. 17. 49 M.K.K Nair, Reminiscences, FACT Magazine, July 1960, p.35. Also see,

Travancore-Cochin State Government Procedings, 1950, p. 28.


110

good track record of profitable operation and healthy industrial relations.

TCC is engaged in the manufacture and marketing of caustic soda,

chlorine and allied chemicals. It is accredited with ISO.9001:2008

certification.50 Commercial production started in 1954 with 20 TPD

caustic soda production capacity. The technology employed was

Mercury Cell Technology. In 1975 the installed capacity was increased

from 20 TPD to 160 TPD. In 1997, TCC started its first Membrane Cell

Plant of 100 TPD caustic soda production capacity. The Plant was

supplied by M/s Ashahi Glass Company, Japan. The production capacity

of this plant was expanded to 125 TPD in 2002. In 2005 and 2006 two

membrane cell plants, each with 25 TPD capacity were installed. These

plants were supplied by M/s Uhde Company, Germany. TCC stopped

operation of its last Mercury Cell Plant in 2004. The raw materials used

for the production are raw salt (common salt), electricity and water.

The production process is electrolysis of Brine (saturated solution

of sodium chloride in water). They apply first generation technology, i.e.,

Diaphragm Cell Technology. This technology employs asbestos _ based

diaphragms in the cells. This technology gave 18 per cent caustic soda

lye (caustic soda dissolved in water form). The product, caustic soda lye,

was contaminated with sodium chloride and hence it could not be used

for all industrial requirements. After the service life period of the

Diaphragm, the asbestos_based diaphragm material became a polluting

agent. So they adopted the second generation technology, i.e., Mercury

Cell technology. However, the Mercury Cell technology requires very

50 Travancore Cochin Chemicals, Annual Report for the year 2008-09, p. 7.


111

high power and it became more costly than the Diaphragm Cell

technology. Another major problem the company faced was pollution,

i.e., the mercury itself. Now the company has decided to eradicate all

types of pollutants in the production of caustic soda. So they introduced

the latest eco-friendly technology, i.e., Membrane Cell Technology.51

The product of Membrane Cell is 32 per cent caustic soda lye. The

energy consumption in Membrane cell is only two-third of that for

Mercury cell. Compared to the previous two technologies, the

Membrane Cell technology is pollution-free. Hence the Membrane Cell

technology is described as energy efficient and environment_friendly

technology.

Growth Stages of TCC:52

1) 1956 - A continuous Caustic Fusion Plant with a capacity to

produce 20 tons of caustic soda per day was installed.

2) 1958- Chlorine Liquefaction Plant was added to meet demand from

the newly set up plant of Hindustan Insecticides Ltd, Udyogamandal.

3) 1960- Production of caustic soda was raised to 30 tons per day.

4) 1963- The Caustic soda capacity was raised to new level of 40 TPD.

The company established a new plant for the manufacture of Sodium

Hydro-Sulphate with a rated capacity of 30 TPD.

5) 1967- The capacity of caustic soda plant was raised to 60 TPD as

per the third stage of expansion.

51 Travancore Cochin Chemicals, Annual Report for the year 2005-06, p. 8. 52 Travancore Cochin Chemicals, Annual Report for the year 2007-08, p. 10.


112

6) 1970- A 60 TPD Caustic Soda concentration plant (CCF) was set up.

7) 1975- Fourth stage of expansion: A 100 TPD caustic soda plant was

set up.

8) 1976- The Company set up its own water pumping and purification

station.

9) 1980- Export of Hydrochloric Acid to Gulf countries.

10) 1983- Installed an indigenously developed plant to recover Mercury

from effluents.

11) 1987- Installed hydrogen firing system in continuous caustic soda

fusion plant.

12) 1988- Replaced graphic anodes by Titanium anodes.

13) 1990- Brine De-chlorination unit was commissioned.

14) 1992- Research & Development Department was set up.

15) 1994- The Company planned to set up a plant employing

membrane cell technology for the production of caustic soda in

collaboration with ASAHI GLASS Company of Japan with a

capacity of 100 TPD.

16) 1997 - The Company commissioned the new membrane technology

plant with 100 MT capacities.

17) 2000 - The Company set up a Brine Purification Plant.

18) 2002- Capacity of AGC Plant was increased from 100 TPD to

125TPD caustic soda.


113

19) 2005-2006- Two 25 TPD each UDHE plants were installed which

utilizes membrane Cell Technology, each making an overall plant

capacity of 175 TPD.

Market Share of Caustic Soda in Kerala: TCC has 80% of the total share

whereas DCW has10%; Chemplast 05% and others have 05% of the total

share of the company. TCC is the only Chlor-Alkali industry in the state and

the only one in the Public Sector in the country. Country-wide, it has about

38 competitors, big and small. The caustic soda industry in the country is

facing a crisis with supply in the excess of demand. The woes in the power

situation in the state have limited TCC from operating in its full capacity in

the recent years. TCC and the similar power_ intensive industries were

established in the state, when there was abundant supply of cheap power.

Over the years, the state had to depend more on costly thermal power which

dented the prospects of the electricity Board. The result was frequent power

cuts and excessive tariffs. The variable ‘time of the day’ tariff structure was

brought which affected industries like TCC which has non-stop process.

The company has tried to fight the adverse conditions on its own by trying

to improve efficiency. The foremost among the efforts is the bringing of

membrane cell technology, which helped saving energy consumption to the

tune of 30%. For the production bonus system the specific energy

consumption is one of the factors and it has ensured contribution of the

employees towards their efforts. With the support of all the members of the

TCC family it could achieve the Zero Effluent standard and thus the factory

became an eco-friendly industry.53

53 K.A Muhamed, Prathisandhikalil Patharathe , Rasavani, The House Magazine of

TCC Ltd 2009, p. 5.


114

The Departments and Functions: It is imperative to know how the

factory functions and how it produces. There are many departments which

are working together for the optimum efficiency of the factory and they are:

1. Personnel and Operation Department, 2.Technical Department, 3.

Production and Operation Department, 4. Human Resource Department, 5.

Finance department, 6. Materials Department, 7. Engineering Department,

8. Electrical and Instrumentation Department, 9. Human Resource

Department and Marketing Department.54

Safety: TCC is committed to achieve excellence in safety, health and

environmental protection. The firm educates employees, customers,

contractors and all those who are associated with its activities. It

believes in pollution prevention rather than pollution control.55 The goal

is to minimize all the adverse environmental and health impact arising

out of operations, conserve all kinds of resources and adhere to all the

statutory stipulations and legal regulations. The main functions are:

giving fire training, safety training, first aid training, maintaining the

hydrant points, hoses and nozzles in good condition, regular maintenance

of self contained breathing apparatus, checking the house keeping plants,

regular maintenance of fire water pumps and tanks and issuing the

personal protection equipments. The instruments used for the safety are

helmets (for head protection), ear muff & ear plug (protection of ear),

goggles (for eye protection), face shield, rubber gloves, dusk mask (for

nose protection), safety belt, safety shoes, gum boot and face mask.

54 op cit., p. 8 55 Travancore Cochin Chemicals, Rasavani 2009, The Eco friendly activities of the

Company, p. 20.


115

Accident investigations, taking preventive measures, issuing work

permits and conducting safety mock drills also form the department’s

priority.

Pollution Control: The Company is fully aware of its social responsibility

and commitment to protect and conserve the environment. In tune with

this, the company has carried out various schemes, including extensive

pollution control measures. On site emergency planning, training of

employees and customers are done with accident prevention and safe

handling of chemicals. One goal is to minimise all adverse

environmental and health impact, arising out of operations, conserving

all kinds of resources and adhering to all statutory stipulation and legal

regulation.56

Water Pollution: As per the Act of 1974 (Prevention & Control of

Pollution) the full standards for effluent discharged into the river, has to

be strictly adhered to the following parameters and norms.

Parameters Limiting Standard

pH 5.5-9.0

Mercury .01mg/1

Sulphate .01mg/1

Suspended solid 100mg/1

Oil & Grease 10mg/1

Total residual c12 10mg/1

Volume of discharge 10m3/tons of NaOH produced

56 Kerala State Pollution Control Board, Best Pollution control Award in 1998.


116

Air Pollution: The main air pollutants are Chlorine, Hcl vapours. As per

the prevention and control of Pollution Act of 1986, the maximum

permissible limit is as follows:

Parameters Limiting Standard

Chlorine 1.6mgm/m3

Hcl vapours 7.5mgm/m3

Mercury 0.05mg/m3

Noise Pollution: Sound above 80 decibel is considered as noise.57 In

TCC sound from boilers, combustion air fans, air compressors etc cause

noise pollution. Here sound intensity is measured using sound level

meter. The protective equipments used are ear plug and ear muffler.

Environmental Pollution: TCC is committed to achieve excellence in

safety, health and environment protection. Efforts are taken to encourage

awareness in these areas among the employees, customers, contractors

and all those who are associated with these activities. The strong thrust

is on pollution control.58 The company is fully aware of its social

responsibility and commitment to protect and conserve the environment.

In tune with, this the company has carried out various schemes including

extensive pollution control measures. One goal is to minimise all adverse

environmental and health impact of operations, conserve all kinds of

resources and adhere to all statutory stipulation and legal regulation.

57 Laws to control Noise pollution: In industrial zones sound beyond 65 dB is not allowed between 6 a.m and 10 p.m. From 10 p.m to 6 a.m sound limit is 55 dB. In residential zones the sound limit is 55 dB during day time and 45 dB in night. In silent zones including hospitals, schools, court etc., the limit is 50 dB during day time and 40 dB in night. Also see, Appendix No. XIX

58 Ibid.


117

Safety and Pollution Control: The company provides for prevention of

hazards in those units where total elimination is not feasible. It also

provides personal protective equipments to everyone wherever is

necessary. Consideration of health & safety of the work force is given

top priority in plant operation and maintenance. The company ensures

health, and safety aspects are given due importance and consideration

in the purchase and maintenance of plant equipments, machinery and

materials. All contracts are made only through strict procedures with

appropriate supervision. The company carries out safety audit, risk

assessment, studies and mock drills. Periodic assessments of the

health of employees are done and remedial measures are implemented.

Employees, consumers and public are imparted awareness, training on

safety and health on all aspects of the process and the products.

Products Profile: TCC produces a wide varieties of products from

caustic soda to sodium hypo chloride. The various products of TCC are:

1.Caustic Soda. (NaoH) 2. Chlorine. (Cl2) 3. Hydro Chloric Acid. (Hcl)

4. Sodium Hypochloride.59 TCC’s main raw materials are common salt

(sodium chloride), electricity and water. The company requires about

3700 units of electricity and 1.72 ton of salt to produce one ton of caustic

soda. Common salt is mainly procured from Gujarat and Tamil Nadu.

Products and Production Capacity

Products Capacity Caustic Soda lye 125 TPD Liquid chloride 72 TPD Commercial HCL 387 TPD Soda bleach 45 TPD Caustic soda flakes 100 TPD

59 Travancore Cochin Chemicals, Products Profile, p. 21


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Caustic Soda (NaoH): Caustic Soda is a basic alkali. It came into being

in the latter half of the 19th century with the development of electrolysis.

Caustic Soda Lye, obtained from Membrane Cell, is a clear, colourless,

odourless and soapy liquid. TCC produces two types of caustic soda lye

of concentration 30-33% and 48%. The total quantity produced per

annum is 57750 T.60

Uses: i. A Chemical for dissolving extraneous matter from wood, for

preparing pure cellulose, for the preparation of alkali cellulose and for

the production of viscous solution. ii. As saponification agent. iii. In

bleaching, dyeing and mercerizing. iv. For processing of monazite and

refining of bauxite. v. A purification agent and absorbent for acidic

gases. vi. A cleaning agent. vii. For refining petroleum fractions. viii.

Reagent for production of various organic chemicals.

Industries Served:1.Rayon, 2.Paper, 3.Soaps, 4.Textiles, 5.Minerals and

Rare Earths Elements. 6. Fertilisers. 7. Heavy Chemicals, 8. Engineering,

9. Drugs and Pharmaceuticals, 10. Petroleum Refining.

Chlorine (Cl2): Chlorine, a co-product obtained in the process of the

manufacture of caustic soda is a chemical used for the manufacture of

plastics, various organic and inorganic chemicals, petrochemicals, textiles,

paper, insecticide and pharmaceuticals. It is the traditional water

purification agent. Chlorine and chlorine compounds in pharmaceuticals

industry have served billions of lives since its discovery and use. The total

quantity produced per annum is 42599 T. Specification: It is a greenish

60 Travancore Cochin Chemicals, Rasavani 2009, p. 7.


119

yellow gas with characteristic pungent smell. Liquid Chlorine is amber in

colour and is one and half times as heavy as water. Chlorine percentage

volume is 99.8. Moisture ppm by mass (Max) is 100%. Uses: i. For

producing insecticides like DDT, BHC etc. and pesticides like aldrine. ii.

For purifying drinking water and sterilizing sewage effluents. iii. For

manufacturing PVC and allied co-polymers. iv. For upgrading titanium

content in limonite. v. For producing chloramines and its organic derivatives.

Industries served: 1.Insecticides, 2. Water purification. 3. Plastics. 4. Paper

and pulp. 5. Textiles. 6. Sugar. 7. Rubber. 8. Mineral. 9. Fine Chemicals.

Hydrochloric Acid (HCL): The company also produces high purity

HCL, which is used for Ossean, fertilisers etc. HCL finds its application

in a number of chemical industries such as mineral processing, gelatin,

food industry, water treatment etc. It also serves the industries like

engineering, starch and plastics. It is a yellowish green colour liquid.

The total production per annum is 127742 ton. Specification:

Hydrochloric acid as HCL percentage by mass is 30-33. Iron as Fe ppm

by mass (max) is 2-3. Free chlorine ppm by mass (max) is 20. Mercury as

Hg ppm by mass should be nil. Uses: i. For the production of ammonium

chloride and in the manufacture of phosphoric acid. ii. In monazite

processing for the separation of rare earths as chlorides from thorium. iii. A

cleaning agent in galvanizing. iv. For the manufacture of PVC. v. For

hydrolyzing starch into sugar. Industries served: 1. Fertilisers, 2. Minerals,

3. Ossean, 4. Starch Industry, 5. Plastic, 6. Engineering.

Sodium Hypochloride: Sodium hypochloride, known as soda bleach

finds its application in bleaching and disinfection and also in the


120

extraction of rare earth chemicals. It is a pale yellowish green colour

liquid. Soda Bleach is the only branded product that is produced by the

company, the brand name is “Eco-clean”.61 Specification: It is a pale

yellowish green colour liquid. The available chlorine should be between

120 GPL. Excess alkalinity (as NaOH) 20 GPL. Uses: i. As a bleaching

agent. ii. As a germicide and cleaning agent. iii. For sterilization.

Industries served: 1.Textile, 2. Paper and pulp, 3.Hospitals.

Caustic soda Flakes: It is a white deliquescent solid in flakes form.

Caustic Soda flake have concentration of 98% to 99% NaOH.

Process Description: Membrane Cell Process: The equipment used in

membrane cell process is monopolar electrolysers. The implementation of

this membrane cell technology has reduced the power consumption. The

equipments are grouped into four categories. 1. Primary Brine purification

2. Secondary brine purification. 3. Electrolysis 4. Caustic evaporation.

In the primary brine purification section, raw salt is dissolved in the

saturator; where brine after dechlorination is fed from the bottom. After

dechlorination, the brine moves to clarifier from the saturator. Clarified

brine passes through brine filters. The filtered brine goes for secondary

brine purification. In the secondary brine purification, brine is further

purified to the quality acceptable to the membrane cell process. The

ultrapure brine is fed to the electrolyser. The electrolysis plant consists of

the membrane cell electrolysers of monopolar type. Ultra pure brine is

fed to the anode chamber and de-ionised water along with recycled

61 Travancore Cochin Chemicals, Annual Report for the year 2006-07, p. 5.


121

caustic soda is fed to the cathode chamber of the cells. The brine in the

membrane cell gets electrolyzed and three products are generated. They

are the chlorine gas from the cathode chamber. In this process an ion

exchange in the membrane separates the anode and cathode chamber.

Saturated ultrapure brine is filled into the anode chamber and the

membrane permits only the sodium (positive) ions to pass through it to the

cathode chamber and prevents any hydroxyl (negative) ions from migrating

to the anode chamber. In the cathode chamber, water is decomposed into

H+ and OH ions. Na+ ions from the anode combine with OH ions in the

anode chamber to form 30-32% caustic soda solution and hydrogen is

evolved as by-product and at the cathode, chlorine is liberated. The total

power consumption per ton of caustic soda produced is 2750 KWH.62 The

caustic soda thus produced is of low concentration (only 30-32%) and needs

to be more concentrated by evaporation of water.

Achievements of TCC: TCC has always been in the forefront to adopt

and incorporate the latest technology in its plants. Several innovations

and modernization schemes were implemented to achieve higher

production and productivity, energy conservation, environmental control

and economy in inputs. The company has been dynamic to be proactive

to market conditions and thus to come out as a large profitable public

sector undertaking.63 TCC was bestowed with various awards for

excellent performance with regard to production, productivity, energy

conservation and environmental protection which are considered as

awards for commitment rather than for efficiency.

62 TCC Annual Report for the year 2008-09, p. 4. 63 Rasavani, The House Magazine of TCC Ltd 2009, p. 7.


122

1981- Best performance Award for safety from the Directorate of

Factories and Boilers, Government of Kerala.

1987- Award for the best performance in safety in India under

‘Chemical Industries’.

1988 - Best Pollution Control Award under ‘Heavy Inorganic Industries

Group in Kerala’ from Kerala State Pollution Control Board.

1989- Award for the best performance in safety in India under

‘Chemical Industries Group’ from National Safety Council.

1990 - Prize for productivity from Kerala State Productivity Council.

1993 - Best performance award for energy conservation in the State of

Kerala under ‘Chemicals and Fertilisers Group’ from Government of

Kerala.

1995 - Best performance Award for productivity in the state of Kerala under

‘Large Industries Group’ from Kerala State Productivity Council.

1996 - Best performance Award for energy conservation in the state of

Kerala under ‘Major Industries Group’ from Energy Management

Centre, Government of Kerala.

1998 - Performance Award for Energy Conservation under ‘Chlor Alkali

Sector Group’ form the Ministry of Power, Government of Kerala.

2003 - Kerala State Energy Conservation Award.

2004 - National Energy Conservation Award under ‘Chlor Alkali Sector’.

2005 - Kerala State Productivity Council Award.

2006 - Kerala State Energy Conservation Award.


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The major customers of TCC are pharmaceuticals, soap,

insecticides, pesticides, paper and rayon industries. No strikes have been

reported in the last 10 years and it shows the healthy relationship of the

workers and the management. TCC has a flexible credit policy. It gives

credit facility up to 30-45 days and they get a credit of 6 days from

suppliers. The pricing policy of TCC is flexible according to the

industrial standards. New technology of membrane cell has the

advantage of being pollution-free. No major environmental pollution has

been reported so far. The strength of TCC is the quality of their products,

service and prompt delivery. The fact that customers have never rejected

TCC products is a sign of product quality. The company depends heavily

on electricity which accounts for around 60% of the product price.

3.3.4 Hindustan Insecticides Limited

The Indian Chemical Industry is an imperative and integral part of

the Indian economy, contributing to around 6.7 per cent of the Indian

GDP.64 In the production of chemicals, the Indian Chemical Industry

ranks 12th by volume, in the world. It touches our lives in many ways.

The industry is a vital part of the agricultural and industrial development

in India and has key linkages with several other downstream industries

such as automobile, engineering, food processing etc. Today India has

achieved considerable progress in the production of basic organic and

inorganic chemicals, pesticides, paints, dyestuffs and intermediaries,

petrochemicals, fine and special chemicals and toiletry product segments.

The central government has taken an active step in lieu of modernisation

64 The Director, India 2010 A Reference Annual (ed), p. 558.


124

in promoting and advancing Indian chemical Industry. The Ministry of

Chemicals and Fertilisers is responsible for planning, development and

regulation of the industry. It was initiated by the government in the year

1991. The Ministry of Chemicals and Fertilisers is the administrative unit

of three departments viz., Department of Chemicals and Petrochemicals,

Department of Fertilisers and Department of Pharmaceuticals. The

ministry is headed by the Minister of Chemicals and Fertilisers.

Hindustan Insecticides Ltd comes under the Department of Chemicals

and Petrochemicals.

Hindustan Insecticides Limited is a government of India enterprise,

under the Department of Chemicals & Petrochemicals, Ministry of

Chemicals & Fertilisers. It was commissioned in March, 1954 for

supplying DDT for National Malaria Eradication Programme launched

by the Government of India. Subsequently the company diversified into

agro pesticides to meet the requirements of the agriculture sector and has

grown manifold with a turnover of ` 2006.00 million in 2006-07.65 The

company has also entered the field of safe and eco-friendly botanical and

bio-pesticides for public health and plant protection. It has also started

marketing of seeds in the northern, central and western parts of the

country. The Company has a wide network of marketing throughout the

country through its six regional sales offices and a good number of

dealers. It has three manufacturing units at present; one is at

Udyogamandal, near Kochi in Kerala state, second, at Rasayani near

Mumbai in Maharashtra and third, and the last being the latest at

65 Hindustan Insecticides Limited, Annual Report for the year 2006-07, p. 12.


125

Bathinda, Punjab. It also has a Research & Development complex with

an experimental farm at Gurgaon in Haryana.

The Ministry, headed by the Minister of Chemicals and Fertilisers,

has a Minister of State and a secretary. It also has an additional secretary

and financial advisor, with two joint secretaries, one Economic advisor

and a Deputy Director General.

The product range includes insecticides, herbicides, weedicides and

fungicides etc. It has a pest control division catering to industry houses and

offices. With the renewed focus on DDT, as a cost effective and efficient

tool to fight malaria, the company has ventured into export of DDT 75%

WDP mainly to African countries. With US re-starting aid for procurement

of DDT and WHO strongly endorsing the use of DDT for indoor spraying,

the company is the world’s largest DDT producer, with great scope in

emerging as the main DDT supplier to the world. The company has been

exporting its agro pesticides to a number of countries such as Netherlands,

U.K, Jamaica, UAE, Philippines, South Korea, Belgium, Guatemala,

France, Germany, Argentina, Ethiopia, Egypt, Spain etc, for the last decade

and more and its products have wide acceptance in the world market.

The vision of the company is “to be a global player in the field of

crop protection and public health”.66The mission of the company is to

provide quality through clean and safe technology which would enhance

agricultural productivity and promote public health along with increasing

the product range, exports, efficiency and productivity.

66 Hindustan Insecticides Limited Company’s growth profile, p. 18.


126

At the corporate level, the company has a Board of Directors

appointed by the President of India on the advice of the public sector

enterprises selection board. HIL has three main self-sustaining units in

India. Each unit is divided into a number of sections which are under the

control of a department head who is responsible for organising the

concerned department. The HIL Udyogamandal Unit is divided into

eight departments.

Each department is headed by a DGM and an Officer. The officer

directs and coordinates the activities of his subordinates and implements

the decisions taken by all his deputies in their daily meetings. The

Departments are 1. Personnel and Administration Department. 2. Finance

and Accounting Department. 3. Commercial Department. 4. Production

Department. 5. Engineering Department. 6. Fire and Safety Department. 7.

Quality control Department. 8. Research and Development Department.

Products of the company: Hindustan Insecticides Udyogamandal Unit

is one of the first public sector undertakings in Kerala under the second

five year plan. The unit is located in Eloor, the capital of the Industries

of Kerala. This unit manufactures four major products apart from DDT

(Dichloro Diphenyl Trichloroethane) which is a public health insecticide,

with a production capacity of 6344 MT per annum; Mancozeb a

fungicide with a production capacity of 1000 MT per annum; Dicofol, an

acaricide with a production capacity of 150 MT per annum and

Endosulfan, an insecticide with a production capacity of 1600 MT per

annum. It also produces branded products like Hildan, Hilfol and Hilban.

A new 1000 TPA Plant to produce Mancozeb has been commissioned


127

recently. With the Mancozeb Plant going into production, this unit will

be able to meet a significant part of the demand for two widely-used

pesticides in India i.e, Endosulfan and Mancozeb which are now being

imported.

Dichloro Diphenyl Trichloroethane (DDT): DDT is a potent contact

insecticide used for controlling vectors of malaria and kala-azar disease in

our country. DDT is produced by the condensation of Monochloro

Benesene and Chloral (obtained by Chlorination of Alcohol) in the presence

of Oleum. The reaction is complex and the chemicals used in the

manufacturing process are highly corrosive. The manufacturing process is

highly sophisticated and equipments are made of special material. DDT is

formulated into water dispersible powder by particle size reduction after

mixing with inerts like china clay and wetting and dispersing agents. DDT

50 WDP formulation is used in the Malaria eradication programme of

NAMP. The unit has a capacity of 1344 TPA of DDT (Technical) and 2688

TPA for DDT WDP. DDT is not used in agriculture but used extensively

for the control of vector-borne disease especially malaria and kala-azar.67

Endosulfan: Endosulfan is a broad spectrum insecticide/acaricide used

against almost all kinds of pests on different crops. It is a mixture of two

isomers namely alpha and beta. It is insoluble in water but highly

soluble in organic solvents. Endosulfan is very effective against several

cash crops such as cotton, paddy, sugar cane as well as fruits and

vegetables. It is a safe bet against all insects. That is why it is highly

recommended in pest management programme in our country. The

67 The Guidelines from the HRD Ministry, Central Government of India, 1954, p.5


128

manufacturing process involves two major steps - a) production of Het-

diol by the condensation of Hexachlorocyclopentadience and Butenediol

by Diels Alder Reaction, and b) Conversion of Het-diol of Endosulfan by

reaction with Thionylchloride. The technical product is then formulated

to 35% EC. The brand name of Endosulfan EC manufactured by HIL is

Hildan which has become almost a house_ hold name in the agricultural

heartlands of our country. The capacity of technical plant is 1600TPA

and the formulation plant is 1910 KL per annum.

Dicofol: Dicofol is an acaricide especially effective in controlling

mites and lices and is widely used in Tea Plantation and Vegetable

gardens. HIL is the first company in India and the second in the world to

set up production facility for Dicofol (technical). With the plant in full

steam of production, the entire domestic requirement for this vital

acaricide used in cash crops and tea and coffee plantations, can be met.

Thus it becomes a major import substitution, with possible international

export potential as well. Dicofol is produced by the chlorination of

DDE, followed by hydrolysis of the chlorinated product. The technical

product is formulated as 18.5% EC for use in agriculture. Dicofol is also

active in the protection of many fruits and vegetables from all types of

mites’ species. The plant has a capacity of 150 TPA for Dicofol

(Technical) and 600 KL per annum for EC formulations. Both the

technical and formulation plants are based on the technology developed,

scaled up and optimized by the company’s in-house R&D.

Mancozeb: Mancozeb, technically is a complex of manganese, zinc,

ethylene bisdithyocarbomate. It is a grayish yellow powder very


129

sparingly soluble in water and fully, in organic solvents. It is a protective

fungicide used for the control of a broad range of plant diseases and also

for seed treatment. Being an environment friendly fungicide, effective

against almost all types of fungi, Mancozeb is expected to have excellent

market potential, both domestic and international. It is manufactured

from Carbon disulfide, ethylene diamine manganese and Zinc salts. The

plant has an initial capacity of 1000 TPA for mancozeb (Technical) and

1800 TPA for formulation with provision for expansion at a later stage.

The plant is based on the in-house technology of HIL, developed by the

R&D division.

With the commencement of the expansion and diversification

programme, HIL has entered into the agricultural marketing field in a big

way. The company has organised its marketing functions and established

marketing network to satisfy consumer needs through its own channels.

The company has added to the product lines a number of imported and

locally manufactured pesticides, so as to provide a complete range of

products to the farmers at the grass root level. The company has a

central marketing set up, controlled and co-ordinated by the Head Office,

with Regional Sales Office at Delhi, Hyderabad, Calcutta, Nagpur,

Ahmadabad, Coimbatore and Cochin.

As pioneers in the field of pesticides, used in both agriculture and

public health, the company makes every effort to retain its prominent

position in the domestic as well as international scenario by introducing

state_of_the_art products. The R&D unit at Udyogamandal is concentrating

on the development of a formulation technology and trouble-shooting


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operations in the production plants, while the Gurgaon centre is engaged

in developing technology for technical pesticides apart from field

evaluation of toxicity studies on residues, development of effluent

treatment and pollution control techniques etc. Almost all the new

formulations marketed by the company are based on the know-how

developed and perfected by HIL. The R&D centre also has the unique

distinction of developing indigenous technology for three chemical

pesticides, i.e., Carboxin, Mancozeb and Dicofol.

Branded Products:-These products are either formulation of technical

products or raw materials of these products. They are sold in the form of

emulsifiable or wetable powder. These products are classified into

three:-68

a. Insecticides: Hildan, Hilmala, Hilcyperin, Hilban, Hilquin, Hilmilin,

Hilbtk, Hilbil.

b. Weedicides: Hiltachlor.

c. Fungicides: Hilhen, Hilnate.

Human Resource Development: HIL draws its strength from its human

resource. Hence the company gives utmost priority for the development

and updating of its skilled man power. Udyogamandal unit has a

strength of 439 employees out of which 78 come under the

Supervisory/Managerial cadre and 361 as the unionised workmen

category. In line with the changed economic and industrial scenario, to

imbibe the spirit of change and adapt to the circumstances, the company

68 Hindustan Insecticides Limited, Company’s Product profile, p. 8.


131

conducts training programmes for the workmen as well as officers. The

policy is to cover one fourth of the employees under the training

programmes every year.

Industrial Relations: The company has got the rare record of

maintaining healthy and harmonious industrial relations. Grievances and

disputes are settled on day to day basis through continuous discussions

with the unions.

Welfare: The welfare of the employees is taken care of by the

company. A residential colony has been provided with recreational

facilities. Employees’ children are given scholarships for their studies.

A full time medical officer and a well-equipped dispensary, managed by

qualified personnel as well as ambulance services, are provided round

the clock. The company has a subsidized canteen. Loans at concessional

rates are given to employees for construction of house as well as for the

purchase of various domestic appliances and to own modern facilities.69

Safety and Accident Prevention: The company is quite conscious of

the need for ensuring absolute safety as any lapse will affect not only the

plant and employees but also the public living in the vicinity. This

awareness is reflected in plant operations, use of safety gadgets, periodic

training on the need for safety practices at work spots to minimise the

chances of accidents.

Environmental Management: The company has formulated an

environmental management system for achieving the environment

69 The Hindustan Insecticides Limited Company’s welfare policies, p. 11.


132

objectives and targets, and also for averting environment impact. The

company developed Centralised Effluent Treatment Plant capable of

treating all the effluents generated from various plants. The System was

put up, based on the design developed by National Environmental

Engineering Research Institute (NEERI), an authority in the field of

Environmental Engineering. The equipment designed by M/s.

Richardson & Crudas Ltd, is in operation at present. The effluent is

treated and analysed by HIL’s own control Lab approved by State

Pollution Control Board.

The company incorporated several modifications and additions to

the system in view of the changes made recently in environment

regulation in relation to solid waste management. These measures have

helped to make the disposal of hazardous waste in a proper and scientific

manner. As part of environmental management, HIL, always operating

responsibly, developed a secure landfill facility for the disposal of

hazardous waste generated. Secured landfill is considered a scientific

method of disposing waste on land that does not create any

environmental pollution or undesired health hazards to the public.

Further, the company undertook elaborate study for upgrading the

existing effluent treatment system as well, to ensure long term

requirements. The basis for the study is pollution prevention. It is to be

mentioned here that the study made by the company revealed that the

zero waste concept in the present situations has great significance. The

natural resources are getting depleted fast due to their blatant

exploitation, upsetting the ecological balance and threatening the healthy


133

growth of all forms of life. Hence, HIL decided to implement the zero

effluent discharge system. This is to ensure that the quality of effluent to be

handled is reduced and only a minor quantity of effluent requires to be

treated. As such, no effluent needs to be discharged. HIL installed an

incinerator (1993)-for the first time in the state- to destroy hazardous waste

and further went ahead for a new incinerator with the latest technology,

meeting the changes made recently in environment regulation of the Kerala

Pollution Control Board (with valid air consent from KPCB).

Outlook for Future: “Nations live as they produce”, so do organisations.

Being engaged in the supply of much needed vital chemicals for public

health and agricultural programmes of the country, HIL has naturally an

important role in its prosperity. Fertilisers and pesticides played a great role

in the Green Revolution of the country which helped to attain self-

sufficiency in food. Equally or more important is the role played in the

control of malaria, kala-azar, dengue fever etc., during peace times and

plague and other epidemics after natural calamities. The company has

always remembered its core obligations and rededicated itself towards the

task of eradicating disease and hunger from this great nation. HIL has been

a story of hard work and sustained efforts by a dedicated band of people.

While the company is proud of its achievements so far, it is determined to

play its legitimate part in the nations fight against hunger and disease which

justifies its motto: “Protect to Prosper”.

Although the company is engaged in the production of essential

products, it is facing numerous challenges. They are: 1. Environmental

pollution. 2. Increase in raw material cost. 3. Stiff competition from


134

private parties, except for the DDT products. 4. Supplementary products.

5. Resistance from environmental protection groups, NGOs etc. Though

the company is protected from competition by the government

regulations, it is facing a lot of protests due to the adverse impact on the

environment. Various international NGOs have pointed at HIL as the

main culprit for the environment degradation that has happened in its

vicinity.70 Endosulfan, which is a product of this company is a highly

toxic substance and remains in the environment polluting it for a long

time. It gets into the living beings through the food chain and it

ultimately reaches the human beings through the process of

biomagnifications. Hence, there have been outcries against endosulfan

and public pressures to close down this plant. The waste management

of the company has not been adequate and effective, due to the lack of

financial support from the government. The loss in revenue also gets

accumulated every year.

The company plays a vital part in its participation for the National

Malaria Eradication Programme launched by the Government of India.

The products of HIL are a must if India is to achieve the goal of

eradicating the pest-borne diseases totally. However, at present the

company is in crisis. Despite this handicap, in the crucial element of

employee satisfaction, HIL index towers above even the private sector by

a huge margin. The company has witnessed only very few employee’s

unrest in its long history. The fact that HIL is manufacturing insecticide

is both an advantage as well as a disadvantage for its future trajectory. If

70 Report of Periyar Malineekarana Virudha Samithi, p. 3; Report of Thanal, p. 3 Also see, Green Peace International Report, p. 5.


135

proper support is provided by the central government, HIL can turn

round its fortunes and become a major player in the field.

3.3.5 Indian Rare Earths Ltd.

Indian Rare Earths Ltd is functioning under the Secret Act of 1923,

so that the details of the company are not available to the public and even

to the scholars and researchers. Its peculiar nature creates lot of hurdles

in extracting reliable information regarding this unit.

Indian Rare Earths Limited (IRE) Udyogamandal was part of IRE

Bombay in 1950. It became a full-fledged Central Government Undertaking

under the Department of Atomic Energy in 1951 and commenced

construction of its Rare Earths Plant at Udhyogamandal in Kerala. This

plant, IRE Udyogamandal, dedicated to the nation on December 24, 1951

by the late Prime Minister, Pandit Jawaharlal Nehru,71 was followed by a

Thorium factory at Trombay in 1955, a Minerals Division at Quilon in

Kerala State 1965, with mineral separation facilities at Chavara in Kerala

and at Manavalakurichi in Tamil Nadu and a giant mineral sand separation

and Synthetic Rutile plant at Chatrapur in Orissa. Indian Rare Earths

Limited (IREL) has four operating plants located at Chatrapur in Orissa

(Orissa Sands Complex-OSCOM), Manavalacurichi in Tamil Nadu (Mineral

Separation Plant), and Chavara (Mineral Separation Plant) & Udyogamandal

(Rare Earths Division) in Kerala. The mission of IREL (Indian Rare Earths

Limited) is to be a major supplier of beach sand minerals and rare earths

compounds in the domestic and international market as well as produce

value-added materials of strategic importance with due regard to resource

71 The Inauguration of the Company on December 24, 1951, p. 1.


136

utilization, safety and environmental protection.72The surveillance of plants

of IREL is undertaken by the Regulatory/statutory authorities like the

Atomic Energy Regulatory Board, the Director General of Mines Safety,

the State Pollution Control Boards etc.

Presently, IRE caters to the requirements of a host of advanced

markets viz., The U.S.A, Canada, The U.K, France, Germany, Japan and

many others, in addition to the domestic market. Approximately 5000

people are employed by IRE and they constitute one of its greatest

strengths. Besides this, indirect employment is provided to about 1500

people engaged in shipping, stevedoring etc.

The local people allege that the company is contributing to

environmental degradation and radiation. There has been growing

resentment among the public. The company, however, claims that all

these hazards are well within the permissible limits.

Rare Earths Division: Monazite, a phosphate of rare earths and

thorium, is chemically treated and processed to provide a wide range of

industrial chemicals at the Rare Earths Division of IRE in Udyogamandal

near Cochin. The plant has the capacity to process 4200 tons of monazite

per annum. The range of products are rare earths chloride, rare earths

fluoride, rare earths oxide, cerium hydrate, cerium oxide polishing powders,

didymium carbonate, disodium phosphate, thorium, oxalates etc.

The plant also recovers small quantities of uranium and produces

helium used in nuclear plants. Based on the process development work

72 Indian Rare Earths Ltd, commitment towards safety, Health and Environment, p. 1.


137

carried out in the in-house research and development department,

concentrates of neodymium, samarium, gadolinium, europium and

yttrium are produced by solvent extraction process in the HERO plant,

set up in early 1990. High purity oxides and salts of lanthanum, cerium,

praseodymium, neodymium, samarium, europium, gadolinium, terbium,

dysprosium, yttrium etc are produced by the ion exchange process.

Rare Earths Chemicals and Applications: The products are widely

employed in the manufacture of misch metal used for making lighter

flints and in steel industry, in the production of catalysts for cracking

petroleum, in the manufacture of metallic soaps which find use as driers

in paints, as a starting material for the production of pure rare earths and

rare earths compounds, for the removal of organic impurities and de-

colourisation of paper mill effluents and in the manufacture of special

ferrous castings.73

Rare Earths Fluoride: It is used in the manufacture of cinema films and

search light arc carbon electrodes, nodular cast iron, special steels and

rare earths alloys.

Rare Earths Oxides: is used in the arc carbon industry to increase the

arc intensity, for glass polishing in optical glass and refractory materials.

Cerium Hydrate is used in the manufacture of polishing compositions,

in the de-colourisation of glass, as an ingredient in TV glass shells, as

ultraviolet absorbers in special glasses, as catalyst component of paint

73 Indian Rare Earths Ltd, Products profile, p. 51.


138

and printing ink driers, as an alloying agent for grain growth control and

ferrous metallurgy.

Didymium Compounds are used in the manufacture of pure rare earths

compounds, in glass, ceramics, nuclear and electronic industries and for

improving the hot workability of stainless steel alloys.

Lanthanum Oxide is used for making lanthanum nickel alloys, used for

storage of hydrogen, for making rechargeable batteries, high refractive

index, low dispersion glasses used in camera lenses, X-ray image

intensifying screens etc.

Cerium Oxide is used in the polishing of optical lenses, plate glass,

television tubes, face plates, prisms etc. Cerium oxide finds its

application in solid state devices, ultraviolet absorption glasses, radiation

protective glasses etc.

Praseodymium Oxide is used for giving bright yellow glaze to ceramic

tiles and also used in permanent magnets, phosphorus, welder’s goggles

and to colour decorative glasses.

Neodymium Oxide is mainly used for making high energy permanent

magnet alloys in lasers, as a violet colourant in glass, in capacitors etc.

Samarium Oxide is used to manufacture samarium metal which finds its

use in the manufacture of samarium-cobalt permanent magnets with high

coercive force and high magnetic energy.

Europium Oxide is used as activators in yttrium oxysulphide for colour

TV phosphorus and EuB6 used in control roads for fast breeder reactors.


139

Gadolinium Oxide is used in the manufacture of Gadlinium-Gallum-

Garnet substrates for magnetic bubbles. It is also used in nuclear

reactors as neutron absorber.

Terbium Oxide is used for making green phosphorus and used in colour

TVs, trichromatic lamps, and in medical radiography.

Dysprosium Oxide is used as a dopant in nuclear reactor control rods, in

neutron density indicator, in special phosphor activator, as dielectric

ceramics dopant.

Yttrium Oxide is used in the manufacture of phosphorus for colour TV

tubes and fluorescent lights, in artificial diamonds, and to stabilise the

hardness to ceramic superconductors.

Tri-sodium phosphate is widely used as descaling and degreasing agent

in boilers, as filler in the production of detergent powders, to improve

clarification of sugarcane juice and to decrease the quality of molasses,

also used in textiles, paper and food industries for cleaning.

Thorium nitrate & Thorium Oxide: - Used in the gas mantle industry

and for starter in the fluorescent tubes and for making fuel elements for

nuclear reactors.

Minerals:

Ilmenite : For the manufacture of Titanium Dioxide & Synthetic

metal

Rutile : For the manufacture of welding electrode fluxes

Leucoxene : For the manufacture of welding electrode fluxes


140

Zircon Sand : In ceramic foundries and refractories

Microzir-1 : As pacifier in ceramics

Sillimanite : In refractories

Garnet : As abrasive for sand blasting in water jet cutting and

glass polishing.

Synthetic Rutile : In the manufacture of titanium oxide pigment and

titanium sponge/metal.

The Rare Earths Division, Udyogamandal, supports and sustains

the local community and the workers of the company. This factory used

to cater to the needs of 900 employees though the strength is only 300 at

present. This unit has carried out many programmes for ensuring public

health. The unit facilitates and funds the promotion of the education and

the culture of the public. With this end in view, the unit conducts the

following activities:

Honouring students obtaining highest marks in SSLC from

among the schools in Udyogamandal area.

Provision of Dr. Homi Bhabha Auditorium to the public for

cultural activities

Assistance for the construction to Eloor Yuvajana Vayanaala

building, sponsored by the Grama Panchayath.

Assistance for conducting festivals and religious functions.

Assistance to the Grama Panchayath for arranging the

programmes “Keralotsav” and “Vikasana Seminar” and for

providing playground to local public.


141

3.3.6 BSES Kerala Power Station

Power is a critical infrastructure and the economic growth of our

country in the new globalised world depends on the availability of

adequate, reliable power at reasonable rates. Faced with the acute

shortage of power, several states resort to power cuts to regulate the

supply of electricity. The demand for electricity in India is enormous and

is growing steadily. However, the existing installed capacity is not

adequate to meet the growing requirements, and hence the power sector in

the country today is at the crossroads. Of late, emphasis is also being laid

on non-conventional energy sources like the sun, wind and tides. The

country’s abundant energy resources are being underutilized mainly due to

financial resource constraints. India has taken initiatives to tap wind

energy. India presently has an installed capacity of over 1167 MW and

ranks 5th in the world next to Germany, the USA, Denmark and Spain.74

The need to mobilise resources for achieving self-sufficiency in electricity

has assumed great importance. The responsibility for the development of

the electricity sector lies with the Government, with a marginal

contribution from private enterprises. However, given the highly capital

intensive nature of the sector and the large-additional requirements, it is

not possible to mobilise adequate financial resources by the Government

alone, considering the large requirement of funds for the sector.

Profile of BSES Kerala Power Limited: BSES (Bombay Suburban

Electric Supply), Kerala Power Limited (BKPL) is co-promoted by

Reliance Energy Limited (REL) and Kerala State Industrial Development

74 Profile of BSES Kerala Power limited, p. 12. Also see, The Energy Policy of India, 2000, p. 14.


142

Corporation Limited (KSIDC). In the equity share capital of ` 127.76

crore of BKPL, REL and its group or associate companies holds 86.32%

while the KSIDC holds the remaining 13.68%. BKPL owns a 165 MW

naphtha fired Combined Cycle Power Plant at Eloor, Kochi. BKPL has

entered into a Power Purchase Agreement (PPA) with Kerala State

Electricity Board (KSEB) for the Combined Cycle operation. The

nominal capacity of the plant is 165 MW in the Combined Cycle Mode

of Operation and the contracted capacity is net export of 157 MW (net of

auxiliary power) at the interconnection point. BSES Kerala Power is also

the first Independent Power Producer under competitive bidding to

achieve financial closure. A Tripartite Escrow and Disbursement

Agreement have been entered into among KSEB, BKL, the State Bank of

Travancore (Escrow Agent) and the Government of Kerala has provided

its guarantee.75The company has entered into a Fuel Supply Agreement

with Indian Oil Corporation Limited for supply of naphtha, with option

for alternate fuel such as LNG. The Power Station consists of three GE

make LM 6000 PC series, state_of_the_art aero_derivative Gas Turbines

Generators (GTGs) suitable for dual-fuel operation. The GTGs and

auxiliaries have been packed, supplied and set up by Stewart &

Stevenson, Houston, USA. Three dual pressure-45 tons/hour Heat

Recovery Steam Generators (HSRGs) were supplied and set up by

Thermax Babcock & Wilcox Limited. 39 MW steam Turbine Generators

(STG) and auxiliaries have been supplied, set up and commissioned by

Bharat Heavy Electrical Limited (BHEL). The Combined Cycle Power

75 P.Vinod Kumar, KSEB provides escrow cover to BSES Kerala Power Plan, Indian Express Bombay Ltd, 16th July 1998. Also see, Tripartite Agreement KSEB , BSES & SBT 10th July 1998. & KSEB and BSES Agreement on 15th July 1998.


143

Station started its commercial operation on 23rd November 2001.76The

Power Station operates based on the dispatch instructions of KSEB. The

deemed Plant Load Factor (PLF) of the power station during 2005-06

financial year was 99%.

BSES Kerala Power Limited has set up165 MW naphtha-based

Combined Cycle Power station, at Udyogamandal, Kochi. BKPL 165

MW Thermal Power plant works on the principle of Combined Cycle.

The plant consists of three Gas Turbine Generators and a Steam Turbine

Generator. Each of the GTGs has a capacity of 45 MW and the STG

capacity of 39 MW. The hot exhaust gases from the GTG are passed

through the Heat Recovery Steam Generator (HRSG), where the steam

needed to drive the STG is generated. Since steam is generated using the

heat from the exhaust gases from GTG, the plant is called a combined

cycle power plant. The basic principle of the Combined Cycle power

plant is that burning gas in a gas turbine produces not only power_which

can be converted to electric power by a coupled generator _ but also fairly

hot exhaust gases. Routing these gases through a water cooled heat

exchanger produces steam, which can be turned into electric power with

a coupled steam turbine and generator(s), is called a combined cycle.77

The power generated by the GTGs and STG is at 11KV, 50Hz, 0.8pf.

This power is stepped up to 110 KV and is supplied to 110KV bus

bar, from where the power is supplied to KSEB. The power needed for

the domestic consumption of the plant is also drawn from the 110 bus

76 Reliance Energy Production Manual, p. 43. 77 BSES KPS Production Manual, p. 18.


144

bar. For the station service two supplies (6.6KV &415V) are used. The

station also has two1 MVA Diesel Generator for emergency LT power

supply.

The company has entered into Power Purchase Agreement with

Kerala State Electricity Board for the sale of power to the KSEB grid.

This agreement has provided the Letter of Credit and Escrow Mechanism

for the revenue recovery and the Government of Kerala has provided its

guarantee for the project. The Power Purchase Agreement (PPA) for the

Combined Cycle Project was signed on 3rd May 1999. The Combined

Cycle Power station started commercial operation on 23rd November

2001. The Power Station operates, based on the dispatch instructions of

KSEB. The deemed Plant Load Factor (PLF) of the power station during

2005-06 financial year was 99%.

There are two auxiliary transformers to cater to the power

requirements of the equipments. The electricity generated by three

GTGs and one STG at 11 KV is stepped up to 110 KV and is transmitted

to KSEB through two double circuit transmission lines.78

The BSES Kerala Power Limited, in tune with the parent company

BSES believes in sustainable development and aims at the preservation

and the promotion of the environment in all its activities. BSES and its

group companies, in the process of generation, transmission and

distribution of electricity are committed to achieve excellence in

environmental preservation and to realise the company’s objectives.

78 BSES Operation System Manual, p. 42.


145

BSES Kerala Power Limited is a strong entity in the field of power

generation. With the support of Reliance Energy Limited and with the

completion of the Liquefied Natural Gas terminal in Kochi, the plant will be

very competitive with the advanced technology that it already possesses.

During 1960’s there was no other panchayath having so many

modern factories in the Kerala State as Eloor. As a result, Eloor has

witnessed tremendous development in every field. The quantum leap of

progress that Eloor and its surroundings had is indeed the outcome of

rapid industrial growth. In hindsight it becomes quite evident that Eloor

played a pivotal role in the history of the industrialisation of Ernakulam

District, and by extension, of Kerala.

These big and small industries have effected a paradigm shift in the

life of the people. The socio, economic, political and cultural paradigm

of the district and the state radically shifted, thanks to the new industrial

ethos. When employment opportunities soared, employees and their

families were financially and socially empowered from 1960-1986,

companies catered to the needs of 16,976 workers directly and also 4,400

indirectly. The changed milieu also brought about changes in the attitude

of the people. Urbanisation, cultural synthesis, trade-infrastructure

development, migration of labourers, transition from the agrarian to

industrial society- all these together contributed to a sea-change in the

way of life was organised prior to the phase of industrialisation. Urban

culture in all its divergent hues was manifesting itself slowly but surely

in the hitherto sleepy landscape of Eloor.

….. …..

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