According to a new study by industry body, Assocham, the demand for firecrackers in the country has fallen by a disappointing 40 per cent this Diwali season mainly due to increased concerns for the environment as well as increasing cost of raw materials.

Assocham conducted a survey of 250 firecracker manufacturers at Sivakasi in Tamil Nadu to determine the trends in firecrackers market this year. The study also included about 500 dealers, traders, shopkeepers and retailers in Ahmedabad, Bangalore, Chandigarh, Chennai, Delhi, Hyderabad, Kolkata, Lucknow, Mumbai and Pune.

The study indicates that environmental concerns and awareness about health hazards have resulted in people choosing to celebrate Diwali without crackers or with fewer crackers this year.

The study also found that the increased raw material and fuel prices will result in an increase of 50 per cent in the prices for firecrackers by up to 50 per cent compared to last year. It said that the increased prices will force people to significantly reduce their budgets for firecrackers.

"This would lead to less demand for crackers, thus affecting the margins of producers," Assocham Secretary General D S Rawat said.