Infrastructure spending revival to drive centrifugal pumps demand

The recent slowdown in the industrial sector and the delays in capacity additions in the power and infrastructure sectors have severely impacted the centrifugal pumps market in India. To revive spending in these sectors and to boost industrial growth, the new Government is likely to roll out confidence building measures and reforms to ramp up project execution. Revival in core consumption segments such as agriculture, and industry is imperative to growth of centrifugal pumps in India.
 
New analysis from Frost & Sullivan, ‘Analysis of the centrifugal pumps market in India’, finds that the market earned revenues of Rs 74, 64.3 crore during 2013 and is expected to reach Rs 11,250.44 crore in 2018 at a compound annual growth rate of 8.6%.
 
The new government is expected to jump start investments in key infrastructure segments such as roads, highways, ports, railways and power. With increasing urbanisation, there will be heightened focus on water conservation and waste water management. Supply side issues have also given rise to waste water management, which has led to municipalities and industrial units across Indian cities to install wastewater treatment facilities.
 
“Growth is also expected in other key sectors such as oil and gas as well as metals and mining. These trends could potentially translate into opportunities for centrifugal pump manufacturers across sectors,” said Frost & Sullivan Analyst.
 
Multiple application areas notwithstanding, the replacement sales of centrifugal pumps are low due to their long operating life. This deters end users from replacing pumps that are used in non-critical applications. The market is also pegged back by the lack of consistent R&D geared towards innovation and new product development. Most manufacturers spend only 2% of their total turnover on R&D of new technologies and pump types.
 
“Lower growth in the Indian market has led to increased competition amongst local manufacturers. Manufacturers offering complete engineering and application support and providing specific services such as energy audits are expected to have an edge over other manufacturers,” noted the analyst.
 
Market participants will also do well to develop more energy efficient pumps, as industrial end users are willing to invest in them to reduce their energy costs and carbon footprint. Similarly, these pumps are likely to attract the attention of commercial and residential end users that wish to reduce their operational costs. This cross-sector interest will considerably brighten the prospects of manufacturers in the centrifugal pumps market.