The electrical equipment
industry grew by a much slower
6.6 per cent in FY12, according
to statistics released by IEEMA. The
study was based on physical
performance of its member companies
that account for 95 per cent of the total
industry output. The depressed
growth in FY12 comes after the 13.7
per cent rise recorded in FY11 and 11.3
per cent in FY10.
While the performance of the
electrical equipment industry in FY12
provides moderate encouragement,
the current trends contain seeds of
caution. The domestic industry
continues to be bogged down by the
phenomenon of imports, which
includes cheap imports from countries
like China. The IEEMA study
observed, "Sluggish growth in the
power sector and the escalating
imports of electrical equipment is
significantly impacting the
commercial viability of the domestic
electrical equipment industry and will
have severe long term consequences."
Creating a level-playing field
between domestic suppliers and
imports has been a long-standing
demand of not only IEEMA but also
other small trade bodies in the
electrical equipment space. The
government has yet to enforce
measures to directly curb cheap
imports from China. However, it is
likely that during the XII Plan, the
Indian government could take
remedial steps. Imports from China
have been covering a broad spectrum of
the industry-right from machinery
component to supercritical main plant
equipment. There were several
representations made against Chinese
equipment from leading domestic
equipment manufacturers like BHEL,
Larsen & Toubro, etc. However, the
government desisted from direct
action as much of the incumbent
power generation capacity was
contracted to come up with Chinese
equipment. Further, there was limited
choice available to power producers
given the paucity in domestic
manufacturing capacity. The IEEMA
study observes that imports of
electrical equipment have been
growing at over 28 per cent annually
over the past five years.
Ramesh Chandak, President, IEEMA
said, "In India the focus is largely on
increasing the power generation
capacity. There has been a continuous
under-investment in the T&D sector. This lopsided investment pattern
needs to be corrected; this will resolve
some of the power problems and will
also provide balanced growth."
MICRO REVIEW
The 6.6 per cent growth seen in the
overall electrical equipment industry
during FY12 was largely driven by
remarkable performance of the cables
industry. It grew by 25.7 per cent in
FY12, which came over and above the
16.9 per cent rise in FY11. In fact,
growth in the cables industry has been
steadily inching up from 4.4 per cent in
FY09 (see table). Thanks to its
consistently good performance, the
cables industry has grown appreciably
in size. In FY11, the cables industry
was estimated to be worth Rs.15,510
crore, accounting for 25 per cent of the
electrical equipment industry in FY12.
Power transmission industry that
includes transmission towers and
conductors declined by 0.8 per cent in
FY12. In fact, this important segment
(having a weight of 23.4 per cent in the
total industry in FY11) has been on a
downturn over the past four years.
Growth in this industry has
consistently fallen from 13.5 per cent
in FY09 to 4 per cent in FY11. Of the
two components, it was transmission
towers that led to the overall decline in
FY12 when it fell by 5.3 per cent. Power
conductors, on the other hand,
recorded a growth of 4.3 per cent.
The transformer industry grew by a
feeble 1.2 per cent in FY12 as against a
very healthy 13.5 per cent in FY11.
While power transformers have
performed consistently, it is
distribution transformers that have
shown erratic trends. In FY12, the
distribution transformer category
suffered a 3.3 per cent against the 7.4
per cent growth seen in power
transformers.
After two consecutive years of
double-digit growth, the switchgear
industry had to contend with a 2.4 per
cent fall in FY12. In FY11, the segment
had grown by 21.2 per cent that had
come over and above a 14.5 per cent
growth in FY10. Among the other
major electrical equipment categories,
rotating machines (motors) could
grow only by 1 per cent, once again
coming after two years of encouraging
growth rates.
IEEMA, in its statement, has urged
both Central and state governments to
intervene in order to check the
deceleration in growth of the electrical
equipment industry.
Untitled Document
PERFORMANCE OF ELECTRICALS INDUSTRY: 2008-09 TO 2011-12 |
|
Weight
(%) |
Industry Size*
(Rs.crore) |
y-o-y % change |
|
|
|
2008-09 |
2009-10 |
2010-11 |
2011-12 |
| Rotating Machines |
10.5 |
6,310 |
-3.5 |
13.3 |
12.2 |
1.0 |
| LT Motors |
5.1 |
2,985 |
-6.5 |
22.7 |
12.9 |
1.2 |
| HT Motors |
2.1 |
1,225 |
13.1 |
10.3 |
-1.4 |
21.8 |
| Alternators |
1.9 |
1,115 |
2.9 |
1.1 |
20.7 |
-17.7 |
| FHP Motors |
1.4 |
780 |
-12.3 |
3.5 |
17.3 |
-5.9 |
| Switchgear |
15.1 |
9,100 |
0.0 |
14.5 |
21.2 |
-2.4 |
| Power Contactors |
2.6 |
1,000 |
-17.8 |
41.0 |
28.7 |
-10.4 |
| LT Circuit Breakers |
3.6 |
1,360 |
-1.0 |
29.4 |
19.5 |
-5.8 |
| MCBs |
2.8 |
1,050 |
9.7 |
23.0 |
7.7 |
15.5 |
| S/F and F/S Units |
0.5 |
207 |
-11.1 |
5.3 |
3.8 |
-4.3 |
| HT Circuit Breakers |
5.6 |
2,140 |
2.4 |
-5.8 |
28.4 |
-5.8 |
| Cables |
25.8 |
15,510 |
4.4 |
12.1 |
16.9 |
25.7 |
| PVC Power Cables |
17.9 |
9,710 |
14.3 |
14.5 |
9.0 |
17.4 |
| Control & Special Purpose Cables |
7.9 |
4,300 |
-26.6 |
2.4 |
34.3 |
44.5 |
| Transformers |
20.6 |
12,350 |
-1.2 |
9.1 |
13.5 |
1.2 |
| Power Transformers |
8.6 |
5,150 |
25.8 |
17.2 |
13.2 |
7.4 |
| Distribution Transformers |
12.0 |
7,200 |
-16.9 |
3.0 |
13.8 |
-3.3 |
| Capacitors |
0.9 |
515 |
2.6 |
10.7 |
34.9 |
-1.8 |
| HT Capacitors |
0.3 |
200 |
6.7 |
32.2 |
18.2 |
-8.3 |
| LT Capacitors |
0.6 |
315 |
1.0 |
-2.2 |
44.9 |
1.4 |
| Energy Meters |
3.7 |
2,250 |
-8.2 |
11.3 |
15.4 |
6.1 |
| Transmission Lines |
23.4 |
14,070 |
13.5 |
9.2 |
4.0 |
-0.8 |
| Transmission Line Towers |
12.6 |
6,600 |
6.5 |
19.0 |
6.8 |
-5.2 |
| Conductors |
10.8 |
5,670 |
21.3 |
0.2 |
-0.8 |
4.3 |
| Total |
100.0 |
60,105 |
2.7 |
11.3 |
13.7 |
6.6 |
| *Estimated industry size in 2010-11 |
| Source: IEEMA |