MUMBAI, INDIA — India's injection molding press industry is poised for dramatic growth in the current year on the strength of the stable and new Narendra Modi government.
Eyeing the growth opportunities, major global brands like Milacron LLC have already announced expansion plans — in their case with a $30 million investment. Chinese press maker Haitian International Holdings Ltd. also announced plans to start assembling Zhafir presses in India, and Toshiba Machine Co. Ltd. is expanding capacity at the India factory it bought in 2012.
With a stable government in power, India's sheer population size and growing middle class will fuel growth and development with an innovative policy framework in place.
“It's very clear that India is en route to becoming a global plastics processing powerhouse. By 2020, India will be second to only China in the global polymer processing market. With the continuing improvements to infrastructure and industry, the sky's the limit to India's potential,” said Milacron President and CEO Tom Goeke, at a recent conference in Mumbai.
India's plastics industry had anticipated the change in government, and the result was a slowdown in the market at the end of 2013 and early 2014.
“With trends shaping up positively for the change, orders started trickling in the second half of February,” confirmed N.K. Balgi, chairman of the Indian Plastic Institute's governing council.
It's interesting to note that the overall press making sector was down in last couple of years, but that was mostly the result of weakness at low-end domestic suppliers.
“The [market] share of high-end global brands offering the latest technology has improved in 2013,” said Balgi, who also is associate director of Ferromatik Milacron India Pvt. Ltd.
If the injection press sales were down in 2012 and 2013, auxiliary and automation sales have jumped by almost 15 percent.
“The plastics industry largely feels that auxiliary are no longer a luxury, but a necessity, with paradigm shift in market priorities and increasing quality standards,” Balgi said.
In 2012-13, press sales were down to 3,800 units annually. Balgi expects them to touch the 6,000 mark this year. Next year, he said the market may see a 35 percent increase.
While the overall mood is positive, it may take another three to six months for processors to see strong growth.
“Stability of the central government leads to foreign direct investment and local investment in the sector, which leads to capacity creation by processors to tap the existing demand,” said Jayesh K. Rambhia, chairman of the All India Plastics Manufacturers Association's Plastic Parks & Projects division.
Windsor Machines Ltd. is hoping for 15 percent growth this year, President T.S. Rajan said, and more in 2015.
He thinks the government's new policies will take time to implement, and their impact on sales will be felt by the end of 2014 or early 2015.
Singh is a Plastics News correspondent based in New Delhi.