Impact of euro zone crisis is likely to have minor impact on the construction equipment industry in India.
Addressing a press conference, Mr Vipin Sondhi, Chairman, Excon 2011 and Managing Director and Chief Executive of JCB India, to announce the 6th edition international construction equipment and technology fair ‘Excon 2011', said “Yes, head winds are there, no doubt. But there is potential for the sector to grow 15 per cent during 2011-12 period mainly backed by Government's infrastructure projects.”
“Impact of euro zone is very much there. But the sector does not depend on quarterly or for next six month's performance. The time horizon here is long between five years and 10 years. Also the projected investment in the infrastructure space during the 12th Plan period (2012-17) is pegged at $1 trillion, this is likely to keep us going,” he added.
In addition to global economic uncertainties, the sector is also plagued by rising interest rates and high commodity prices.
“We have requested and have been requesting the Government to address the issue of land acquisition, dispute redressal mechanism while awarding contracts, inter-State tax for easier movement of equipment to execute projects. I am sure these key issues will be addressed in the winter or in Budget session of Parliament,” he explained.
Mr Sondhi “India is a country which is emerging. Critical and vital spend makes a difference and infrastructure is the moot point citizens are demanding every where in the country. It is here Government's role is important,” said Mr Sondhi.
Mr Sondhi elaborating on the construction and equipment industry, said it is the major contributor to the economy where spend on infrastructure constitutes 5-6 per cent of the total GDP.
Industry Report
At the trade fair, consulting major Accenture is to release a report ‘Indian Earthmoving and Construction Equipment Industry Vision 2020: Commanding new heights.'
Sharing few survey findings, Mr Sondhi said “The industry is valued at $3.3 billion in 2010 compared to $1.7 billion in 2006, exhibiting a CAGR of over 18 per cent over 2006-10.”
“Looking ahead, the Indian market has the potential to grow six times from the total revenues of $3.3 billion in 2010 to $22.7 billion in 2020,” he explained.
Exhibition
The exhibition is being held at BIEC campus on Tumkur road from November 23 to 27.
The Karnataka Government is the partner State. Indian Earthmoving and Construction Industry Association is the sectoral partner and the exhibition is supported by Builders Association of India.
The fair for the first time will witness over 2,00,000 square meters of display area and has participation of 630 exhibitors, including 200 foreign companies.
China, Finland, German, Italy, Japan, South Korea, Spain and Turkey have set up country pavilion.
According to Mr Surjit Haridas of CII, the event is expected to witness over 400 new products.
Excon 2011 would also have a large presence of small enterprises in the component and aggregate manufacturing, showcasing country's potential as a preferred outsourcing destination for construction equipment manufacturing.