(Photo Caption: Sonepat Plant of Arise India Ltd.)
Avinash Jain explains that today the most important demand from the industry is to nudge the government towards creating an expansion in infrastructure & real estate development which is a big factor in influencing the growth of the pumps market.
In a country which is agriculture and industry dominated, Pumps play a very important role in forwarding the businesses of the said sectors. Playing a dominant role in the progress of sectors like agriculture, oil and natural gas production, petroleum refining, petrochemicals, power generation, domestic and household utilities, pumps contribute a major part in nation’s economy and wealth. Today this sector commands a net worth of more than Rs. 25000 million and has over its hundred year history contributed to the nation’s economy significantly leading to become India’s vital growth driver.
In the Indian society pumps are the vital cogs in the sustenance & development of various sub-industries like agriculture, onshore and offshore production of oil and natural gas, petroleum refining, petrochemicals, mining, ship-building and marine duties, power generation, public water supply and sanitation, domestic and household utilities. They also cater to the emergent demand of process industries like fertilizers, insecticides, pesticides, drugs and pharmaceuticals, textiles, soaps and detergents, cosmetic and health care products, dairies, vegetable oil and processed and packed food products, breweries, paints, etc.
The Indian pump industry which took shape in the earliest years of the 20th century, has been fulfilling the needs of the Indian & foreign consumer with international quality pioneering technologies at dirt-cheap pricings. An inherently mature market, the Indian pumping sector has seen fair sales over the past years which are expected to hover between 10 to 14 percent in the coming years. Currently pegged at a growth rate of 16 percent in domestic sales, experts believe that this market will churn production anywhere between 2 million units to 3 million units in the coming years, which will increase the suitability of the sector.
While today the demand of pertinent pump solutions emanate from the fact that due to rapid development and urbanization the water table of the country is rapidly diminishing, it also is dependent on the varied needs of various economic sub-sectors which demand top technology at budget pricing. It is this significant pump manufacturing industry composed of over 500 small, medium and large manufacturers that is called upon to address every emergent need that is supplemented by both Indian and international players in the market.
The Indian pump industry today caters to the needs of every segment of consumer and delivers developed mechanisms including industrial pumps for infrastructure needs, and domestic pumps for consumer & agricultural needs churning out technologies like displacement pumps like rotary, reciprocating & peristaltic and general centrifugal pumps like single-stage radial, submersible, multi-stage radial, axial & mixed pumps.
Being a fairly need-based market, the domestic pump market’s 95% consumption is met by local producers, with more international producers catering to bigger clientele. In here, the need today is to have robust consolidation wherein various horizontal and vertical mergers will enable swift changes in technology, economy, legislation, market and positive customer expectations that will create a better future for the industry. Herein experts believe that with strategic inputs, planned investments and favourable governmental policies, the future augurs well for this opportunity-filled market.
Today the most important demand from the industry is to nudge the government towards creating an expansion in infrastructure & real estate development which is a big factor in influencing the growth of the pumps market. The industry understands that rising population & urbanization boosts the demand for pumps in the market and thus looks towards the government to entail positive measures that will promote growth. While there are many challenges in the sector as of today, the sector also seeks the government to come out with positive policy outlay that will enable the pump manufacturers to attract positive consumer outlook.
The sector expects the government to create a value stream of investments and inputs into this industry to keep up the progresses. While the domestic manufacturers have their work cut out to better their product line quality and create a world-class stream of pumps, the government should also bring in remedial measures to reduce the dependency on foreign imports by liberalizing the input of newer technologies to the domestic product range to bring it at par to international standards.
Today India exports pumps to almost 100 countries, with the USA and Germany, at around 13 and 12 percent respectively being the largest destinations. Thus governmental policies should thus be attuned towards encouraging greater sales across international markets. One interesting fact to have come out in the past decade or so is that the Middle East has emerged as an attractive export destination for low- priced Indian pump sets which are being increasingly preferred over European and American counterparts. While the region is a production and infrastructure hub, it still lacks a domestic manufacturing base, which we as leading constituents should look to address. Thus the government should also create a Middle-East focused policy measure that will enable greater export to the region and will earn us critical foreign exchange.
A significant growth driver, incorporation of newer technologies by domestic players will greatly reduce the dependency on foreign players for technological innovations, thus the government should also look into developing indigenous R&D technologies that will enable greater in-house production. This will also reduce the input costs which in the long run will help in reaching out to the untapped markets with price-efficient product range.
In the upcoming budget outlay, the government should ensure friendly export/import, excise duty, and custom duty policies while ensuring that motor industry develops high efficiency motors indigenously on priority basis that will help take the industry on a greater international level. Also there is an urgent need to address the demands of the infrastructure industry whose success is directly relative to the betterment of the pump industry. The aspirations of the infrastructure industry which seeks greater autonomy in terms of policy outlay, favourable taxes, lower import costs and greater impetus to exports need to be addressed as based on the development in the infrastructure industry, stability and growth in the pump industry can be achieved.
We hope that these recommendations will definitely go forward in creating a more inherent line of operation for the sector and will definitely open up newer vistas of the growth of the industry. We are optimistic about the impending success of the sector internationally and thus are looking towards the government for positive support that will enable the industry attain its actual worth and become the lead contributor the new generation of the country’s shining future.
(The author is Managing Director – Arise India Ltd. The company is a leading manufacturer of Inverters, Batteries, Gas & Electrical Geysers, Pumps, R.O. systems, Air conditioners and LED Televisions.)