Machine tool sector told to focus on innovation

The Indian machine tool industry can play a major role in achieving the desired goal of 12-14 per cent manufacturing growth over the medium term during the 12th five year plan period, K Kasturirangan, member of Planning Commission said here on Thursday.

Delivering his inaugural address at the second edition of IMTEX Forming and Tooltech exhibition organised by the Indian Machine Tool Manufacturers’ Association (IMTMA), he said there is a need to increase the share of indigenously developed and manufactured machine tools to achieve the desired manufacturing growth.

“In the approach to 12th five year plan, a number of initiatives have been identified to realise manufacturing growth at much higher levels and improving the physical infrastructure, integrating into global networks, special focus on Small and Medium Enterprises (SMEs), skills and reforms of the governing process,” Kasturirangan said.

The Planning Commission have set a target of achieving 12-14 per cent growth in the manufacturing sector during the 12th plan period over the medium term which is 2 to 4 per cent differential over the medium growth rate in the overall economy, ultimately leading to manufacturing contributing 25 per cent of the GDP by the year 2025. Secondly, improving the rate of job creation and thirdly, the domestic value addition and technology depth in manufacturing, he said.

Further, he said, manufacturing achieved only 7.7 per cent during the 11th plan period though it was desired to record 10-12 per cent growth rate. Kasturirangan said the machine tool sector can play a major role in the entire manufacturing sector as it is a key component of the industry.

“The global machine tool industry is recovering recording an output of $66.6 billion in 2010 representing 21 per cent increase over the previous year. More than 60 per cent of total production is accounted by five Asian countries, namely China, Japan, Taiwan, South Korea and India. Highest production and consumption comes from china. The year 2010 has been a year of rebound after severe recession in 2009. IMTEX is an opportunity for globally active manufacturers to deliberate and develop strategies to mitigate the impact of recession,” he emphasised.

A major characteristic of Indian manufacturing sector is the increasing opportunity it presents in the growing domestic market and a resilient economy.

A direction is needed to increase the share of domestically developed machine tools in the 12th plan in the overall consumption.

The capacity enhancement with an accent on innovation is a priority area. This area also presents collaborative opportunity, Kasturirangan said.

National manufacturing plan has three components like special focus on high contributors for economy, overcoming impediments and attention to the processes and all this emphasises an encouraging news for the machine tool sector, he added.

Vikram Sirur, President, IMTMA said, “India has been gradually emerging as a global manufacturing hub of machine tool and it is estimated that it is soon going to join the list of top five global machine tool markets in next five years.”

To achieve this, he said production needs to grow at an average CAGR of 25 per cent to increase market share to 50 per cent plus. Hence, it is vital to close technology and product gaps, create new capacities, accelerate technology acquisitions and improve skill levels, he said.

IMTEX Forming 2012 features over 500 exhibitors and 600 machine tools weighing 1,000 tonnes with a total value of all exhibits at Rs 100 crore marking an increase of around 40 per cent over the last exhibition in 2010. Companies from 24 countries are exhibiting and China has put up the largest delegation overtaking Germany for the first time.