Last Updated: May 08, 2018
Last Updated: June, 2018
The Indian Engineering sector has witnessed a remarkable growth over the last few years driven by increased investments in infrastructure and industrial production. The engineering sector, being closely associated with the manufacturing and infrastructure sectors, is of strategic importance to India’s economy.
India on its quest to become a global superpower has made significant strides towards the development of its engineering sector. The Government of India has appointed the Engineering Export Promotion Council (EEPC) as the apex body in charge of promotion of engineering goods, products and services from India. India exports transport equipment, capital goods, other machinery/equipment and light engineering products such as castings, forgings and fasteners to various countries of the world. The Indian semiconductor industry offers high growth potential areas as the industries which source semiconductors as inputs are themselves witnessing high demand.
India became a permanent member of the Washington Accord (WA) in June 2014. The country is now a part of an exclusive group of 17 countries who are permanent signatories of the WA, an elite international agreement on engineering studies and mobility of engineers.
Turnover of capital goods industry is estimated to have reached US$ 70 billion in 2017^.
India exports its engineering goods mostly to the US and Europe, which accounts for over 60 per cent of the total exports. Engineering exports for the period of FY18 were US$ 76.20 billion as against US$ 65.23 million in the same period previous year. Exports of electrical machinery and equipment grew at a CAGR of 7.00 per cent during FY10-18 to reach US$ 6.7 billion in FY18. The figure stood at US$ 1.28 billion for Apr-May 2018.
The electrical equipment industry observed a witnessed a record seven-year high growth of 12.8 per cent in 2017-18, on the back of increase in government spending on rural and household electrification schemes and programmes to improve power distribution.
Construction equipment industry of India is expected to grow over 18 per cent in 2018-19.
The engineering sector in India attracts immense interest from foreign players as it enjoys a comparative advantage in terms of manufacturing costs, technology and innovation. The above, coupled with favourable regulatory policies and growth in the manufacturing sector has enabled several foreign players to invest in India.
The foreign direct investment (FDI) inflows into India's miscellaneous mechanical and engineering industries during April 2000 to December 2017 stood at around US$ 3.39 billion, as per data released by the Department of Industries Policy and Promotion (DIPP).
In the recent past there have been many major investments and developments in the Indian engineering and design sector:
The Indian engineering sector is of strategic importance to the economy owing to its intense integration with other industry segments. The sector has been de-licensed and enjoys 100 per cent FDI. With the aim to boost the manufacturing sector, the government has relaxed the excise duties on factory gate tax, capital goods, consumer durables and vehicles.
Turnover of capital goods industry is expected to increase to US$ 115.17 billion by 2025F. India’s engineering R&D market will increase from US$ 28 billion in FY18 to US$ 45 billion by 2020F. Sales of construction equipment are expected to cross the 100,000 mark by 2022, while the market size of construction equipment industry is expected to grow from US$ 4.3 billion in FY18 to US$ 5 billion by FY20.
Exchange Rate Used: INR 1 = US$ 0.015 as of March 30, 2018.
Note: F- Forecast, ^As per media reports from November 2017
References: Media reports, Press releases, EEPC India, Press Information Bureau (PIB), Department of Industrial Policy and Promotion (DIPP), The Confederation of Indian Industry (CII), Indian Electrical & Electronics Manufacturers’ Association (IEEMA).
Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.
Last Updated: May 08, 2018
India's construction equipment market was estimated at US$ 3.47 billion in 2013 ans is expected to reach US$ 7.7 billion by 2016 growing at a CAGR of ...
In India, agriculture and its allied sectors are the primary source of livelihood for a large chunk of domestic population. In 2017...
Improvements in human resources (HR) practices and technology are a key reason for the continuous rise of India's technology sector. However, the growth of the tech s...
Most businesses are dynamic, with processes and objectives that are constantly developing. In order to keep the processes within a business streamlined and efficient as w...
Leather is a prominent industry in India. The main sectors from which its demand is derived are fashion, footwear, furniture, interiors and automotive. While the Indian l...
NBFCs are quickly adopting to the best-in-class technology to bring about disruption and foster future growth
The Indian lending industry, significantl...
Founder and Managing Director of The Mobile Wallet, Vinay Kal...
Zuper: Dynamic Disruptor
Zuper is a B2B Software as a Service (SaaS) offering for organizations, irrespective of shape and size. It is the first in Asia to offer voice biometrics-based timesheet management of workforce. Zuper offers an end to end platform to bring together the power of people, process, product and promise. ...