The downfall of this watch factory began after its general manager was killed by militants in 1990. After that, several technical employees, from outside the state, started to leave.

The manpower reduced gradually. Nearly 132 employees were accommodated at the Bari Brahmana near Jammu, where an assembling unit was set up. At present only 84 workers including 30 female are left at the Jammu unit.

In the last two and half years not even a single unit has been produced by this Jammu unit, while workers are forced to sit idle. Even this sub-unit, with a capacity to produce about 80,000 to 100,000 units annually, could not produce due to lack of support from the main unit.

Even the employees are deprived of basic facilities like canteen, medical, transport, clean drinking water and toilets etc. They have not even received their salary for the last nine months.

Out of 471 workers in Chinar Watch Ltd, Srinagar, a subsidiary of the HMT Group, 270 have opted for Voluntary Retirement Scheme (VRS), while out of 84 employees in the Jammu unit, 37 have sought voluntarily retirement. If the group management approves the VRS proposals lying before it for the last three months, the only watch manufacturing unit in J&K would be closed.

The expenses of the Kashmir-based unit on salary is Rs 50 lakh per month and is nearly Rs 12 lakh at its assembling unit in Jammu. The company is also spending Rs 70,000 per month on rent and other facilities at this unit.

Sources in the Chinar Watch Ltd told Business Standard that the company suffered a loss of Rs 50 crore during 2007-08. This also includes Rs 14 crore incurred on the VRS given to some employees last year.

"Not only the Srinagar unit of HMT but others situated at Bangalore in Karnataka and Ranibagh in Uttarakhand are also facing similar problems, HMT watches are not in demand in the market these days. The company is also facing marketing problem. Despite all this we have received orders from Germany, Sri Lanka and from a Dubai-based company," said Unit Chief of CWL, Srinagar, M A Khanpuri.

"The Srinagar unit can also produce ‘Quartz' watches. The company should improve the quality of its products to compete. The watch unit of the group is running into losses but its Tractor and Tools divisions are in profit. CWL receives budgetary support from the government and salaries are released only after that," He added.