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Key markets for Auto parts exporters drying up! |
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Contraction in automobile sales across Europe and the US has put brakes on the growth of exports of auto components from India that have ended near flat in fiscal 2008-09 after witnessing an over 20% CAGR since 2003.
Vishnu Mathur, executive director of Automotive Component Manufacturers Association (ACMA), said with the key markets drying up, Indian component exporters had difficult time in overseas sales, something that had been shaping up firmly over the last few years.
With situation on the export front remaining grim, he refused to guess on when there would be a revival. "It is difficult to say anything now. There are no real indicators to suggest when there would be recovery," Mathur said.
Kiran Deshmukh, deputy managing director of Sona Koyo Steerings Systems, also said sales in overseas markets have been a laggard. "It has been more or less flat and there has not been much improvement in the situation," he said. Deshmukh said demand in export markets was likely to remain subdued in the coming time. "Revival seems to take longer to come back," he added. The company is a supplier of steering systems to cars and off-highway vehicles.
AK Taneja, President of Shriram Pistons & Rings, also said overseas markets remained sluggish. "While we could still manage a growth of about 20% in exports, this was way below our targets. The problem is that while we have created new capacities, the volumes are not realised.
While Europe accounts for nearly 44% of auto component exports, North America's share is 22% which is followed by Asia with 15%. And while Middle East and Africa account for around 7% each of the component exports, South America accounts for 4%.
India’s exports to France increase by nearly 23%
According to Francis Bouquin, French Trade Commissioner in Kolkata, the bilateral trade balance between India and France shifted in favour of India in 2008, as India’s exports to France increased by nearly 23 per cent vis-À-vis one per cent decline in French exports to India. Addressing an interactive session organised by the Bharat Chamber of Commerce here on Monday, Bouquin said, “The bilateral trade between the two countries in 2008 clocked €6.8 billion, with India enjoying a trade surplus of around €150 million.”
The exports of consumer goods, accounting for 34 per cent of the country’s exports to France, garment and leather (28 per cent), agro food (10 per cent) and semi-finished goods such as chemical, plastics etc (24 per cent) picked up last year with more Indian items entering the European markets, he said.
On the other hand, exports of equipment from France into India declined marginally last year. Equipment for ships, aircraft, railways and motorcycle constitutes 63 per cent, semi-finished goods 25 per cent and consumer goods 7 per cent of its total export to India.
There was good deal of interest among French companies to establish joint ventures and manufacturing tie-ups in India, particularly at a time of slowdown in Europe, he pointed out. While the Moselle Development Centre had economic representative offices in Japan and China, it had no immediate plans of setting up the same in India, he added.
Jean Louis Rysto, Consul General of France in Kolkata, said France was keen on providing aid for the people affected in the Sunderbans area in South 24 Parganas.
Right time for India, China to explore investment synergy: FICCI-
According to apex industry chamber FICCI, at a time when the developed economies that have traditionally been the demand drivers in world trade are shrinking, India and China have an opportunity to co-opt and explore trade and investment synergies, To explore trade potential between the two countries, K. K. Modi, former President of FICCI and Chairman of India-China Joint Business Council and Modi Enterprises, is leading a FICCI business delegation to Hong Kong, Macau and Zhuhai from June 11-13.
According to Modi, “There is an urgent need to develop greater financial and manufacturing synergies between the two emerging economic powers (India and China) of the world. The time is ripe to take advantage of the window of opportunity offered by the growth trajectory in India and China at a time when the economies of the western world and other nations are shrinking.”
During the visit, the delegation will meet top business leaders in Hong Kong, Macau and China to discuss possibilities of engagement and cooperation between the two Asian giants, in finance, tourism, entertainment, gems and jewellery and manufacturing.
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