This Report of India's Engineering Sector details the sector analysis upto March 2011 and concentrates on exports too .

1. Presentation by P MadhusudhanaPrabhu March 2011 A Report on India's Engineering Sector

2. Introduction Classification of Engineering Sectors Key user Industries Growth Factors Trends Opportunities on the defence sector Opportunities in engineering services Future Outlook Preview

3. Classification of engineering sector Heavy Engineering Transport Equipments Capital Goods Other Machineries Sub Sectors – - Textile, Cement, Sugar, Rubber machinery… …Dairy, Mining, Machine tool ,Metallurgical etc., Light Engineering Low Tech –eg., castings, forgings, fasteners , etc., Highly sophisticated equipments Diagnostic Medical Sub Sectors – - Medical /Surgical, Process control equipments, steel forgings, Ferrous castings, etc.,

4. Key user industries These industries are in turn dependent on the growth factors . Illustration of Key user industries Indian Engineering Sector Growth

5. Industrial Majors Refining, Automotive, Textiles Power utilities Generation, Transmission, Distribution Retail Consumers Pumps and motors Government Public Investment Key user Industries contd…

6. Growth Factors Well developed demand conditions India’s labour cost advantage Growing capabilities of Indian engineering firms Preferred outsourcing destination Government initiatives with respect to power, infrastructure etc., Dilicensing , removal of tariff protection , promotion of SEZ’s …

7. Growing trend of engineering exports Source : - EEPC India , December 2010 survey

8. Statistical scenario : Exports of Engineering Services : - FY 09 - $ 4.9 bn CAGR 17.6 % over Fy07 and Fy09 Potential to reach $ 29 bn in 2015 = 20 % of Global market share Opportunity for 2009-2014 ( 5 year period) ~ $ 62 billion Sectors :- Automotive Sector = 19 % Aerospace = 8 % Utilities = 3 % Telecom = 30 % Opportunities in Engineering Services

9. Global scenario Global military expenditure – 2008 = $ 1464 billion 2007 = 4 % increase. Indian scenario Among top ten nations in military expenditure Defence budget growth at CAGR =11.5 % between FY 06 & FY 09 to $ 26.5 bn for FY 09 MSME sector outlook Now ~ 5000 companies 20-25 % of components , sub-assemblies to state owned companies Govt & Pvt sector participation Major sector = communications & IT equipment Opportunities in Defence Sector

10. Entry of International companies 100 % FDI route permitted – entry of international players Incresing the competiveness of the industry . Migration to value added products Focus on improvising capabilities Quality consicious Technology up gradation at par with global market needs Focus on R&D and product development efforts . Diversification of Risk Eg., L & T moved into power equipment manufacturing , BHEL plans to exporting to Syria and Vietnam etc., Key Trends

11. Major sectors : Defence Aerospace Telecom equipment IT equipment Power utilities etc., ~ THE END ~ Future Outlook