Featured Image

International News From the Field: India

India ended 2021 with a bang. The Purchasing Managers’ Index registered 55.5 for the month of December. Moving into 2022, opportunities abound. From EVs to microchips, from defense to off-road, from renewable energy to steel, India means business ...
Jan 07, 2022

India ended 2021 with a bang. The Purchasing Managers’ Index continued its year-long above-50 streak, registering 55.5 for the month of December. Moving into 2022, opportunities abound. From EVs to microchips, from defense to off-road, from renewable energy to steel, India means business, and the investment dollars are staggering. For specific industry intel and other tidbits, read on.

  • The Purchasing Managers’ Index (PMI) continued its expansion, registering 55.5 for the month of December.  

  • According to the recent Economic Times survey involving 56 CEOs and business leaders from across India’s manufacturing, services, and infrastructure sectors, companies are in an investment and capex boom. About 93% of the respondents are planning on major investments due to emerging business opportunities, government incentives across several manufacturing sectors, and the availability of low-interest financing.

Apart from manufacturing sectors like EV, appliances, and medical devices, as highlighted in the last India edition, a few more sectors hold great potential for 2022 and beyond:

  1. Defense Manufacturing. The government has set a $25 billion target for defense manufacturing growth by 2025. It is presently a $12 billion industry, so it should more than double in the next three years.

  2. Electronic Hardware Manufacturing. The electronic systems design and manufacturing market has been growing at a CAGR of 16% since 2019 and is likely to reach $220 billion by the end of 2025. This is due to very strong demand, supportive government policies, and an increased focus on component indigenization.

  3. Renewable Energy. Presently, there is a total of 105 GW of installed capacity in this segment. The target is to enhance the capacity to 450 GW by 2030 – with 280 GW of which generated through solar power.

  4. Off-Road Equipment. With the government’s focus on extensive road building and other infrastructure-related investments, this sector is projected to grow from $5 billion to $11 billion by 2025.

  5. Auto-Component Industry. The industry witnessed a 5% reduction in sales from 2020 to 2021 due to the supply chain-induced slowdown of auto production, as well as its adaption toward the EV explosion. Nevertheless, the industry is projected to grow three times from its present $45 billion by the end of 2026.

  6. Electronic Chip Manufacturing. In December, the government approved a $10 billion incentive plan to establish chip and display manufacturing in the country. Presently, there are around 20 manufacturing companies planning to invest and use these incentives.

Other local developments:

  • Arcelor Mittal Nippon Steel India Ltd. is investing $13 billion to build a steel plant in Odisha state with a capacity of 24 million tons a year.

  • Tata Motors announced it will invest $1 billion over the next four years to grow their commercial vehicle business.

  • EV scooter startup Simple Energy is investing around $330 million, with government support, in a new facility in Tamil Nadu to produce 1 million electric two-wheelers per year. They have plans in 2023 for a larger second plant to produce 12 million units per year in Dharmapuri. 

  • Hyundai India will invest around $600 million in EV development and is planning to launch six new EV models by 2028. 

  • Indian conglomerate Reliance Industries has acquired UK startup battery technology firm Faradion for $135 million. Reliance plans to invest an additional $35 million to accelerate the commercialization of its products, including batteries for EVs.

  • Mahindra Electric, which presently has India’s largest portfolio of electric vehicles, announced that it plans to make investments to double its manufacturing capacity of EVs. 

  • India’s fastest-growing electric scooter company, EeVe, is investing $150 million to roll out new products from their Odisha-based manufacturing plant. 

Final note: The IMTEX machine tool show, initially scheduled to be held Jan. 20-26, has been postponed in compliance with government-prescribed restrictions preventing the holding of any mass gathering events to curb further spread of the Omicron COVID variant. The new dates are likely to be announced by the end of January.

PicturePicture
Author
Arun Mahajan
General Manager - AMT India Operation
Recent international News
India’s industry sector continues its strong showing with a healthy PMI of 54 and GDP growth likely at a robust 8.9%. Automotive, EV, and defense shine as they attract investment and opportunities. For more industry intel and other tidbits, read on.
India’s PMI hit almost 55 as defense, energy, AI, and AM investments and growth strategies expand. The PLI scheme is drawing major investments in microchips, electric scooters, and 5G hardware. For more industry intel and other tidbits, read on.
India’s manufacturing sector remains strong with the manufacturing Purchasing Manager’s Index (PMI) remaining well above 50 since July of last year. The government and the private sector are seeing that it remains that way with massive investments ...
India’s manufacturing PMI continues to climb as they head to a strong end-of-year performance. The medical, EV, and appliance industries all have staggering growth projections for upcoming years. With the IMTEX show less than two months away, ...
This week’s news from India is, quite frankly, great. The GDP growth for the year will approach double digits, and the manufacturing PMI remains in the mid-50s. The investments in defense manufacturing are staggering and wide open for FDI. ...
Similar News
undefined
International
By Fred Qian | May 18, 2022

China’s zero tolerance toward COVID continues to take its toll on the local economy, particularly in the automotive sector. This week we take a closer look at the local automotive supply chain data that has global economic implications.

5 min
undefined
International
By Mario Winterstein | May 02, 2022

From Japan to Italy, conducting business abroad requires flexible thinking, research, and patience. A global sales strategist shares three actions you can take to enhance your branding process in any international market.

5 min
undefined
International
By Hubert Sawicki | Apr 29, 2022

Today we attempt to assess the European economies and their main challenges – apart from the Ukrainian war zone in Eastern Europe. Two areas of concern have emerged: energy sourcing and maintaining manufacturing levels in the face of changing demand.

7 min