The Centre’s renewed focus on electric vehicles (EVs) is a key issue that concerns the future of of the Indian forging industry, said a top official in the association representing the forging industry.
“EVs are likely to hamper the growth of the forging industry, which has been witnessing growth in the recent past,” said S. Muralishankar, president, Assocation of Indian Forging Industry (AIFI).
He said the industry needed “a clear roadmap to provide a level playing field.” Pointing out that the forging industry would get a clear picture by early 2020 or 2022, he said EVs were going to be the biggest threat to the industry as 60% of forging units are involved in the manufacture of auto components and that a majority are engaged in applications related to engine transmission.
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“As a result, 40%-50% of demand for forged auto components would decline, resulting in job losses and a shutting down of units.”
‘No plan yet’
Currently the Centre does not have a concrete plan to switchover to EVs, he said. The industry should have basic infrastructure such as charging stations and availability of lithum batteries as well as guidelines for disposal of batteries, he added.
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India is the third-largest manufacturer of forging globally, after China and the EU. Currently, it is facing challenges arising out of rising steel and oil prices, a demand-supply gap and technology upgradation.
On steel prices rising by about 26% in the last one year, he said if the trend continued, it would defeat the Make in India initiative and China would get a competitive edge in the global steel market.
The installed capacity for companies in the association has increased to 39.4 lakh tonnes from 38.5 lakh tonnes, while overall production rose from 24 lakh tonnes to 25 lakh tonnes. It is expected to touch 30 lakh tonnes this fiscal, he said.
To improve the business environment for its members, AIFI will be hosting 7th Asia Forge Meet 2019 in Chennai for five days from January 18.