Bangalore, Jan 24 (IANS) The fledgling Indian machine tools industry is betting on economic revival to spur growth in fiscal 2013-14 after reeling under the impact of slowdown and de-growth in the manufacturing sector across verticals in 2012-13.
"As the Indian economy bottoms out, we are confident of demand picking up from across sectors in the ensuing fiscal to spur growth. Policy reforms and a slew of actionable measures being taken augur well for the economy to revive and a proactive budget will ensure the momentum sustains," Indian Machine Tool Manufacturers' Association (IMTMA) president Vikram Surur told IANS Thursday on the margins of a trade expo here.
Admitting that slowdown had affected the manufacturing sector and the machine tools industry in turn, Surur said there was deceleration in demand for metal working machine (MWM) tools due to sluggish growth in the automotive industry, which accounts for about 40 percent of the machine tools industry.
"The trickle down effect of the slowdown restricted new orders and deferred deliveries by our customers across verticals. Recovering from the impact of global meltdown in 2008-09 and its fallout in 2009-10, the industry turned around in 2010-11 in terms of consumption and production, including imports, but began to decline in the second half of 2012-13 due to de-growth in the manufacturing sector," Surur said at the inaugural event of Imtex 2013.
Total consumption picked up in terms of value from Rs.7,205 crore in 2009-10 to Rs.10,191 crore in 2010-11 and Rs.11,764 crore in 2011-12, with imports growing from Rs.4,842 to Rs.6,703 crore and Rs.7,645 crore respectively and domestic production accounting for Rs.2,484 crore, Rs.3,624 crore and Rs.4,299 crore respectively.
As against robust growth in fiscal 2010-11 when total sales were Rs.4,076 crore, including Rs.2,938 crore for CNC (computer numerical control) machines and Rs.1,139 crore for non-CNC machines, sales, however, declined in 2011-12 to Rs.3,860 crore, including Rs.2,789 crore for CNC units and Rs.1,071 for non-CNC units.
"With orders declining and deliveries deferred this fiscal (2012-13), especially during the last two quarters (July-December), consumption is set decline proportionately as against the corresponding period of 2011-12. We are, however, optimistic of demand reviving this quarter (January-March) and picking up momentum from second quarter of 2013-14," Surur said.
In the long-term, demand growth is expected to hold at 15 percent and production is set to growth at 25 percent if the GDP grows at seven-eight percent annually during the 12th Plan (2012-17).
"Our long-term objective is to increase market share of domestic production to 50 percent from 35 percent over the next five years and 67 percent by 2020 and bring down imports proportionately from 65 percent currently," Surur asserted.
Earlier, Society of Indian Automobile Manufacturers (SIAM) president S. Sandilya unveiled the 16th Indian metal-cutting machine tool exhibition and Tooltech 2013 at the Bangalore International Exhibition Centre (BIEC) on the city's outskirts.
About 1,000 exhibitors from 25 countries, including Australia, Belgium, Britain, Canada, France, Holland, Japan, Korea, Russia, Thailand, Turkey and the US are participating in the seven-day expo showcasing latest products and technologies.
"Trade delegates and visitors from diverse industry verticals such as aerospace, automobiles, capital goods, defence, electrical & electronics, infrastructure, oil & gas equipment, pharma equipment, railways, space & nuclear and telecom will have an opportunity to evaluate the products and technologies on display at the fair," Surur added.