Capacity creation in sectors like infrastructure, power, mining, oil & gas, refinery, steel, automotives, and consumer durables is driving demand growth in the engineering sector.
Machine tools industry is set to benefit from growing demand for capital goods. India has a comparative advantage in manufacturing costs due to lower design, research and labour costs, and economies of scale.
The Indian boiler industry has the capability to manufacture boilers with super critical parameters up to 1000 mega watt (MW) unit size. Market size of the industry increased to US$ 2.7 billion in FY10 from US$ 1.7 billion in FY08.
Indian engineering exports stood at US$ 33.7 billion in FY10. India's engineering exports increased at a compound annual growth rate (CAGR) of 13.5 per cent during FY06-10.
Capital goods is the leading contributor of engineering exports, accounting for 47 per cent of Indian engineering exports in FY10. Primary iron & steel is the other major contributor with a share of 26 per cent.
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