The Indian electrical equipment industry registered a decline of 8 per cent during FY13, according to statistics recently brought out by industry association IEEMA. This is the first time in 10 years that the electrical equipment industry has suffered an annual decline. In FY12, the industry had recorded a growth of 6.6 per cent.
IEEMA, in a statement, pointed out that the $25-billion Indian electrical equipment industry is facing an onslaught of cheap imports thanks to the absence of any protective policy measures. Offtake of electrical equipment has been adversely affected by massive project execution delays, mostly by the state-run power utilities, and an unprecedented credit squeeze due to economic slowdown.
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|
Electrical Equipment Industry Performance |
|
|
(% change over previous year) |
|
|
Product |
Weight (%) |
FY12 |
FY13 |
|
|
Rotating Machines |
10.0 |
-1.7 |
1.0 |
|
|
Switchgear |
15.1 |
-1.5 |
-2.4 |
|
|
Cables |
27.5 |
-25.9 |
25.7 |
|
|
Transformers |
19.3 |
-9.1 |
1.2 |
|
|
Capacitors |
0.8 |
-23.9 |
-1.8 |
|
|
Meters |
3.9 |
-0.7 |
6.1 |
|
|
Transmission Equipment |
23.4 |
7.5 |
-0.7 |
|
|
Overall |
100.0 |
-7.8 |
6.6 |
|
|
Source: IEEMA |
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“Slackening demand in the power sector, continuous rise in imports of electrical equipment, especially China and South Korea and an absence of a level playing field is threatening the existence of the Indian players,” the IEEMA release noted, adding, “imports of electrical equipment have grown more than 20 per cent in the last fiscal, thus eating into the domestic manufacturer’s pie.” Statistics point towards sharp rise in imports of 765kV transformers, insulators, LV switchgear and even HV cables.
On the brighter side, exports of electrical equipment, led by demand in Africa and some other countries, have also risen significantly. Principal export items included of AC generators, switchgears, transmission towers and energy meters.
IEEMA, in the release, said that it was encouraged by the initiative of the Department of Heavy Industry of taking a holistic view and formulating the Indian Electrical Equipment Industry Mission Plan 2012-2022. IEEMA also expressed keenness in drawing a clear roadmap for enhancing competitiveness of the domestic electrical equipment industry.