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E-commerce boom

The Times of India, Jun 29 2015

S Unnikrishnan Nair & Pradeep Gupta

E-commerce boom reshapes Maha powerloom town as warehouse hub

Fields once covered with paddy and vegetables have sprouted high-tech warehouses. E-commerce biggies, from Flipkart to Amazon, as well as niche players have warehouses here to route products to Mumbai homes. In the process, the new industry is reshaping the Bhiwandi economy -and changing the lives of some local farmers.

The transformation has happened slowly , and without any regulation. No one knows how many warehouses there are here -local police say the number runs into the thousands. A survey has now been initiated, says tehsildar Vaishali Lambhate, as the government looks to start tapping revenue from the sector.

Bhiwandi has always enjoyed a location advantage, sitting astride highways that connect Mumbai, Thane and the JNPT port. It had warehouses years ago, too; old-fashioned godowns to store ce ment and the like. But those were too few to make a difference to the local economy .Bhiwandi remained a town of powerlooms, with a largely poor, migrant and Muslim population, and a history of communal riots. Then, between 2005 and 2008, Indian companies began strengthening their logistics chains. This was when villagers in Rahnal first gave their farm land on lease for construction of warehouses, says social worker Surendra Tiwari. But it was the post-2010 e-commerce boom that changed everything.

Online firms wanted fulfilment cen tres at a place that could serve their key markets within a day . Bhiwandi fit the bill -the rentals were cheap as these were panchayat areas and there were no taxes, says an industry insider.

From the outside, the warehouses look like huge factories but they do not make things, only store them. Still, they offer semi-skilled and unskilled jobs, and employ anywhere from 15 to 500 people.Wages can go up to Rs 25,000 per month, and more for managerseal-estate boom The new economy has also attracted real-estate developers. High-rises up to 22 stories have come up in areas like Anjurphata, Kalyan-Bhiwandi road and Kambha. Private banks that used to refuse home loans in Bhiwandi have begun sanctioning loans for these projects.“You can buy flats in buildings without any amenities, or go for one [with] a club house, garden and swimming pool,“ says Ajay Singh, a local developer. The rates range from Rs 2,700-Rs 4,000 per square feet. But locals say illegal constructions are also mushrooming. And indeed, the rise of warehouses here has yet to lead to broader improvements in regulation, infrastructure and even basic services in the area.

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