INDUSTRIAL EQUIPMENT SECTOR OVERVIEW
Statistics, news & updates: everything you need to know about the Industrial Equipment Industry in India
Summary/Snapshot
Industrial Equipment Industry
- The government has set up 15 special Economic zones for the electrical machinery sector. Countries like Japan, France, the UK, the USA, and Italy have also invested in electrical machinery in India.
- The government’s US$ 1.6 billion production-linked incentive scheme for telecom gear manufacture, authorized in February 2021, is expected to boost the Indian telecom equipment sector.
- The agricultural machinery sector primarily comprises tractor manufacturing and contributes one-third of global production. The largest importers of such machinery are Turkey and Malaysia.
- In FY20, India’s domestic auto component industry was valued at US$ 49.30 billion, and it is predicted to reach US$ 200 billion by FY26.
- The government is pursuing several efforts to increase local defense production. In keeping with this, the Indian government signed 264 contracts for defense equipment purchase between FY17 and FY22 (till June 2021), with 159 contracts for armed forces equipment procurement.
- By 2030, engineering goods exports are estimated to exceed US$ 200 billion.
Growth Drivers
- The engineering industry has been delicensed, and 100 percent foreign direct investment is now permitted.
- Infrastructure, electricity, mining, oil and gas, refinery, steel, automotive, and consumer durables sectors are all boosting demand in the engineering sector.
- The Indian construction machinery segment was valued at USD $6.66 billion in 2021 and is projected to grow at a CAGR of 8.9% to USD $12.4 billion in 2029. There are different types of construction machinery in the market for heavy operations, such as excavation, lifting, and material handling. This market is driven by several factors, including commercial, residential, industrial, and public-private partnerships.
- With big foreign businesses looking for expansion prospects in the Indian engineering sector, 100 per cent FDI is available through the automatic method.
Sub industries
- Cold Chain
- Components (including Pipes) & Services
- Cutting tool & equipment
- Fasteners
- Gaskets, Packing & Sealing Devices
- Valves
- Filters
Opportunities
- The government has also recommended that MSME be granted RS. 10 million in 59 minutes using an online platform.
- During FY18-22E, infrastructure investment is estimated to expand by US$ 778.90 billion, driving demand for capital goods
Challenges
- Manufacturers have an incomplete perspective of their profitability, a lack of visibility into the supply chain, and the capacity to communicate efficiently across diverse stakeholders.
- Another problem is increased flexibility. An increasingly turbulent and unpredictable Indian economy necessitates the development of more flexible and efficient working machinery by Industrial Equipment makers.
- The increased demand for industrial equipment is putting more pressure on manufacturers to keep their cost-per-unit constant
Key Investment Opportunities
- India plans to add 93 GW by 2024 which will generate huge demand for power transmission and distribution (T&D) equipment.
- The engineering sector in India attracts immense interest from foreign players as it enjoys a comparative advantage in terms of manufacturing cost, technology, and innovation.
- Production Linked Incentive scheme for automobiles and auto components worth US$ 3.49 billion is announced. This scheme is expected to bring investments of US$ 5.74 billion by 2026.
Recent Developments
- Industry 4.0 and automation are currently taking shape thanks to technologies such as AI, 5G, advanced automation, advanced sensing, and many others.
- Manufacturers can leverage a wide range of features thanks to the interconnection of machinery, sensors, and control systems via intelligent networks. These include quick new product development, real-time production and supply chain network optimization, highly adaptable manufacturing, robust product and mass customization, self-optimization, self-configuration, and self-diagnosis.
Key Players in India
National
- Larsen and Toubro
- CG Power and Industrial Solutions Ltd.
- Engineers India Ltd
- Cummins India Ltd
- Thermax Ltd
- BGR Energy Systems Ltd
International
- JCB India
- Metso Minerals
- Atlas Copco
- Trane Technologies
Map Clustering
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