Over the last one year, recession may have pulled down the demand for machine tools, but the industry players have fixed their sights on the next bend of revival.
Over the last one year, recession may have pulled down the demand for machine tools, but the industry players have fixed their sights on the next bend of revival, which they expect will happen towards the middle of 2009.
In fact, N K Dhand, president, Indian Machine Tool Manufacturer’s Association (IMTMA), is banking heavily on the Indian machine tool exhibition 2009 (IMTEX 2009), to be held in Bangalore from January 22-28, to generate huge enquiries that will eventually translate into business.
Dhand said, “The last two downturns — 1998 and 2001 — had seen IMTEX helping propel demand. We expect something similar to happen during this year’s exhibition too.”
Though IMTMA is projecting a lower turnout of one lakh visitors at this year’s exhibition against 1.3 lakh visitors in 2007, it is estimating higher business enquiries of Rs 6,000 crore as against Rs 5,000 crore at the last exhibition.
However, keeping in mind lower spending power in the current scenario, the industry body is expecting the confirmed orders to remain constant at Rs 600 crore. Shailesh Sheth, media chairman, IMTMA, said 940 exhibitors will be showcasing 1,500 machine tools worth Rs 350 crore at the latest IMTEX in Bangalore.
Like other industries, Rs 15,000 crore machine tools industry has also been grappling with slowdown in demand. However, it is expecting to maintain growth rates at 20-22% this fiscal, which will be at the same level as last year.
Though, the current growth rate of 20-22% is lower than the growth rate of 4-5 years back, which was 30-35%. Dipping demand in various sectors has led to cancellations of around 5% of total orders in the machine tool industry.
The machine tool industry’s woes have been further aggravated due to imports eating into its market. The share of imports in the total consumption of machine tools has been swelling in the past few years. At present, domestic companies produce only 23% of total machine tools consumed by the Indian market. About 4-5 years back, the share of domestic industry was 50-55%.
Dhand said most of the medium and heavy machines of high value are being imported.”
“Technology levels of India’s machine tool industry needs to be raised to international level. For this, huge investments need to be brought in and the number of institutions for technology has to be increased, ” said Dhand.
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