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Building Indian competitiveness

EM NEWS BUREAU ,  Thursday, February 09, 2012, 16:49 Hrs  [IST]

Exhibitions like Elecrama 2012, recently held in Mumbai, go on to suggest a lot about the industry. In this case, it is not just about the size and nature of the power T&D industry, going by the mind boggling number of exhibitors and their highly diverse profile. It is about the appeal that the power T&D equipment holds at the international level. Given that the event attracted over 100 countries—in terms of visitors and exhibitors—the Indian industry is now well on the global radar. Indians are keen to supply overseas and global suppliers are looking to India with large business aspirations. India is a huge market that no supplier would like to ignore.

The investment outlays in the power sector are only increasing. What is more encouraging to note is power T&D is now earning the attention that it always deserved but never got. In the XII Plan period, the T&D sector is likely to see an investment outlay of Rs.6.80 trillion which is the highest ever. It is also much larger, again for the first time ever, than the Rs.6 trillion outlined for power generation. The XII Plan period is therefore going to be a very eventful phase for the T&D sector and perhaps can define a paradigm shift in India's power history.

One of the views expressed during the various deliberations at Elecrama 2012 was about Indian competitiveness. It was very pertinently observed that while India is trying to compete largely with respect to costs, it should instead do so on the plane of innovation. India appears to be overly preoccupied in warding off Chinese competition, but in the process is losing sight of the fact that innovation could lead to vastly superior products, and perhaps at lower costs. China on the other hand has put a tight control on costs, largely in its ability to create a fully-integrated local value chain. India has not been able to do as yet; its continued dependence on imports for critical raw material is a deterrent to progress.

Policy framework does not appear to fully support the "Brand India" philosophy. The government is cognizant of this lacuna, as was evident during various keynote addresses at Elecrama 2012. In the XII Plan, it is likely that there will be some curbs on cheap imports through rationalization of duties. This could create a level-playing field that Indian manufacturers have always desired. As the head of a Central PSU firm summarized, "We want support on taxes, not competition!"
 
                 
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