“The Govt. being the apex agency that spends money and also sanctions projects under PPP and FDI, has to clear proposals on top priority,” observes Rajinder Raina, General Manager (Marketing), Escorts Construction Equipment
According to an ICEMA report, the earthmoving and construction equipment market is expected to grow by 20 to 25 per cent over the next few years. Seeing the current sluggishness in the demand, how optimistic are you about this target?
There is no argument about improvement in demand, percentage points, 10 or 15, is a matter of detail. Perusal of the data of the past 15 years is proof enough that there is a huge potential for growth. The current sluggishness is an outcome of non clearance of various projects by the government.
Which are the factors can play major role in achieving this ambitious target?
The Govt. being the apex agency that spends money and also sanctions projects under PPP and FDI, has to clear proposals on top priority. There is a sense of pessimism in the market, the new RBI governor has given a sense of hope, need like-minded people at the decision making positions. Sense of urgency is a must.
With elections nearing, do you anticipate a hurry to clear and inaugurate major projects?
It’s anybody’s guess. Normally projects do get cleared during this stage. The Govt. would do well to grant ‘go ahead’ to the projects that are on hold or awaiting approval. There are some major projects that could get a nod before the elections.
Which are the project sectors will be on priority for such hurriedness?
Projects in the mining sector, power, roads (under PMGSY) and metro rail could be accorded priority.
Will it really make any impact over the infra sector performance?
It certainly will send positive signal to the industry and overseas investors. From ‘nothing happening’ to ‘some movement’ would be like overcoming inertia, there from it will be easier to roll on.
Talking about Escorts, what have been the highlights of year 2013 in your CE business? Have the returns of your projects been up to your expectations?
The year 2013 was a pretty tough year for the entire industry. We at Escorts embarked upon various projects to be battle ready for the near future. The market place is going to be challenging one and we need to consistently evolve to stay relevant with sustained competitive advantage. Products and services have to deliver value to the delight of the customers and that’s where Escorts is headed to.
Where will Escorts’ focus be in 2014?
At Escorts –Construction Equipment, 2014 is going to be the year of ‘Quality & Customer’. The focus is going to be on quality of product and after-sales support. A lot of effort has gone into making improvements on backhoe loaders, safe cranes and also road compaction equipment. These changes shall be tangible. It’s going to be a new experience for the customers or end-users.
In 2013, we saw some major M&A activities in the M&CE space on the global level. Do you see this trend in India?
Given the negative growth in demand of equipment in the year 2013, the budgets for M&A were revisited. The derivatives of M&A for different companies are linked to their sales strategy. In India, the M&A spends or activities are changing too. The international exhibitions are now being held at various metros. Print media has come of age too, with the high quality and circulation of magazines; it has become a potent communication tool. However, due to reduced M&A budgets, companies shall focus on specific markets and areas.