The ongoing economic crisis has caused reduction in demand and has resulted in yet another closure. Asian Paints, the country's largest manufacturer of paints, today announced a temporary closure of its chemicals plant engaged in the manufacture of phthalic anhydride (PAN) at Ankleshwar.

Asian Paints said it was forced to close the plant, manufacturing phthalic anhydride, which is used in the manufacture of paints, due to pressure from cheap imports.

Asian Paints has two paint producing plants in India, one located at Cuddalore in Tamil Nadu, and the second in Gujarat, which has been shut down. The Ankleshwar plant produces PAN for Asian Paint's own use and also to sell it to other paint manufacturers. The unit is a part of Asian Paint's backward integration strategy and accounts for 2.7 per cent of the total revenue of the company.

Asian Paints posted a 15.5 per cent rise in net profit at Rs 131.5 crore in the second quarter of the current fiscal year compared to the same period a year ago.

The duration of the closure is undecided. Shares of the company closed at Rs 944, down 1.33 per cent from its previous close on Wednesday at the BSE.