Mumbai Capital

Foundry industry looks to invest Rs 1 lakh crore to expand capacity

The foundry industry — which makes metal castings or forgings used in the manufacture of components by all types of industries, from auto, sanitaryware to aerospace — is eyeing major growth opportunities from the Government of India’s ‘Make in India’ initiative and manufacturing of defence equipment by the private sector.

“Several new initiatives have opened up vast growth opportunities and we are looking for large-scale expansion. We need to double our capacity. This will involve a capital investment of $15 billion or nearly Rs 1 lakh crore in five to 10 years,” K Samaraj, president, Institute of Indian Foundrymen (IIF), the apex group of the industry, told The Hindu .

“If we don’t do it ourselves, the manufacturing industry will source forgings from outside the country and it will be our loss. Industry players are capable of making this kind of investment over five to 10 years,” he said.

India’s foundry industry, which is the third biggest globally in terms of production capacity (10 million tonnes in FY16) after China (40 million tonnes) and the US (11 million tonnes), has an installed capacity of 15 million tonnes per year but capacity utilisation has come down to 10 million tonnes due to the impact of the global slowdown and recession in many countries.

Industry players believe new opportunities from the Make in India drive, defence offset programmes and the government’s boost to infrastructure projects such as metro rail will ensure utilisation of the idle capacity and the addition of another 15 million tonnes capacity in the next five to 10 years.

Cautious optimism

“The industry is targeting a total capacity of 30 million tonnes and we are looking at the future with cautious optimism. Things are gradually changing on the ground and we hope the pace will pick up,” Mr Samaraj, who is also the Managing Director of Coimbatore-based Manga Electro Castings Ltd, said.

There are about 4,600 units engaged in forging, which provide employment to five lakh people directly and 15 lakh indirectly.

These units are located in 19 major foundry clusters across the country and collectively exported to the tune of $2.7 billion, besides producing finished components worth $2.5 billion in 2015-16. The industry has a turnover of $18 billion.

“There is a potential to grow to $12-15 billion in the next 7 to 10 years and considering this, we have embarked on a skill enhancement programme to cater to the growth,” said AK Anand, Director, IIF.

He said IIF has started a training programme for foundry workers on a pan-India basis and is offering training at the doorsteps of foundries. Nine modules of the curriculum have been developed in six regional languages as most workmen have studied in a vernacular language. IIF, he said, plans to enhance the skills of 1,000 workmen in 2016, which will be scaled up to 5,000 by 2017.

“Our target is to train 60,000 workmen as both the local industry and multinationals, which will set up base, will require sophisticated products as well as solutions, and our industry should be ready,” Mr Samaraj said.



About 4,600 units engaged in

forging provide

employment to 5 lakh people directly



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Printable version | Apr 11, 2021 6:07:37 PM | https://www.thehindu.com/news/cities/mumbai/business/foundry-industry-looks-to-invest-rs-1-lakh-crore-to-expand-capacity/article8474030.ece

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