India emerging powerhouse in earth moving equipment

Expo generates business enquiries of Rs 2,000 crore, sees 280 participants.

The just-concluded Excon 2007, billed as Asia's third largest international exhibition for the earth moving and construction equipment (ECE) industry, signalled the country emerging not just as a manufacturing centre but also as a location for research, design and development for new products.

The fourth such exhibition, organised by the Confederation of Indian Industry (CII) at the Bangalore International Exhibition Centre on the outskirts of Bangalore, generated business enquiries of around Rs 2,000 crore. Over 280 companies from India and abroad participated, exhibiting over 700 products. The exhibition attracted over 45,000 visitors.

Excon 2007 saw 56 overseas companies from Germany, UK, Korea, China, Italy, USA, Japan, Netherlands, Spain, Russia, France and Singapore participating.

Many companies like Volvo, Telcon, BEML, Asia Motor Works, Taurian Engineering and Soilmec of Italy used the event to launch their new products. Scania of Sweden announced their India entry with a tie-up with L&T Ltd. Japan-based Yanmar Construction Equipment Co. Ltd, also announced its India foray with the launch of industrial, construction, agricultural, marine and environment machinery and equipment.

The domestic exhibitors felt that global confidence in the booming Indian economy, robust growth of the infrastructure sector and positive growth forecasts present a huge opportunity to the construction equipment industry. With the Indian industry now investing in R&D, it has the capability to develop technologies that can establish international benchmarks.

The Business & Industrial Research Division of IMRB International conducted a survey among exhibitors and visitors and the exhibition has generated about 35,000 business leads and initiated over 10,000 deals for exhibitors.

Vipin Sondhi, Chairman, Excon 2007 and Managing Director and CEO, JCB India said, "Excon 2007 has generated a lot of interest among industry players in India. It has been able to provide the necessary fillip to the Indian construction equipment industry."

Companies showcased a wide variety of equipment, technology, and products with an emphasis on efficiency, productivity, environment friendliness and safety. The participants presented and demonstrated the latest developments and advancements in construction equipment technology and products.

Nick Ground, Director, GKD Europe was "very happy with the quality of visitors. These were people who are interested in associating with our company and working together in the booming ECE sector in the country."

Sigurd Weisig, Director, Weiro Weisig Maschinenbau Gmbh recalled being "present in India in terms of machine sales around 10 years ago".

But today "given the huge potential offered by the construction industry, we are hoping to renew our contracts. We are looking for strong partners and distributors."

The optimism mood has been given some substance by a study by McKinsey & Company which has revealed that the Indian ECE industry has the potential to grow fivefold from its present size of $2.3 billion to $12-13 billion by 2015, growing at 24 per cent CAGR.

Commented Vipin Sondhi: "The McKinsey report states that the industry's revenue and volume have recorded a 40 per cent growth year-on-year between 2004 and 2006, reaching $2.3 billion today and uncovers a $40 billion opportunity for the industry between now and 2015."

The study discusses the main trends that will shape the evolution of the industry and highlights the imperatives to realise the opportunity. Of these, four are growth opportunities "" investment of $750 billion in infrastructure development; increasing dominance of price-and-value focused customers; deeper engagement of global equipment manufacturers in India; and increasing opportunities for exports.

However, one trend, increasing competition from product imports from other low cost countries like China could potentially challenge the industry's growth and is a force that industry players need to address proactively.

It says industry bodies must work with the industry and government to create an enabling environment that results in the desired regulatory changes, and export the 'Made in India' brand to international shores.

K V Rangaswamy, president (construction), L&T said, that the construction sector is expected to grow at the rate of 15-20 per cent annually benefiting both manufacturers and raw materials suppliers. The major challenge, according to him, is to select the right equipment for the specific requirements of each project.

Excon 2007 also focussed on cost-effective solutions in tipper application in the mining and construction industry.

Said Eric Leblanc, Managing Director, Volvo India Ltd, "It is very important to focus on the mining and infrastructure sectors and the need for efficient transport solutions, to keep pace with the expected growth rate of 9 to 10 per cent annually. India is currently focussing on road development, investments in port development, airport modernisation, and development of mining and infrastructure technology with the major investment expected from FDI and PPP route."