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Capital Goods

THE INDUSTRY UNDERPINNING INDIA'S ECONOMY


Just as India is constantly changing, so is the world of industrial goods.

Cutting-edge technological advances and increasing automation imply greater demand for new products and systems.

Capital goods help expand future production, and investment in this sector will help produce other goods - machinery, plants or equipment.

In May 2O16 the cabinet approved its first-ever national capital goods policy.

India is increasing its capital goods manufacture


This will lessen the country’s reliance on imported equipment and the impact will be felt throughout sectors including:

ENGINEERING, CONSTRUCTION AND INFRASTRUCTURE

The aim: To triple the production of capital goods by 2025 and create jobs in the process.

India's Capital Goods


India's capital good's domestic production is valued at USD 32 billion, with a total market size of USD 92 billion.

69% of the industry is made up of heavy electrical and power plant equipment.

Process plant equipment and construction equipment also contribute substantially to the industry.

Other Indian Capital Goods

Imports & Exports: on the Rise

Between 2013-2014:


Imports

increased six-fold to a total of USD 18.46 Billion

Exports

increased four-fold to USD 8.57 Billion

As India’s economy continues to expand at more than 7.5% a year, the country's capital goods sector is diversifying. Infrastructure and manufacturing will garner 50% of the estimated investment.

India will need investments worth usd 4.7 trillion by 2019

Grassroots Ingenuity: How everyone can win


12%

India's resourceful entrepreneurs are known for using ingenuity to solve problems for the lowest possible cost, which could in turn drive year-on-year savings of up to 12%.

The Indian capital goods industry aims to marry this innovative approach to cost-effective, advanced solutions that foreign investors seek.

Opportunities for foreign investment in india:

Smart Cities

The 100 Smart Cities initiative needs low-cost housing, sanitation and sewage systems.

Electricity Grid

A Smart Electricity Grid is being proposed with efforts also concentrated on thermal, hydro and nuclear power capacity.

Industrial Corridors

India is focused on attracting technology and equipment for specific infrastructure sectors including industrial corridors, manufacturing hubs, high-speed trains, dedicated freight lines, cargo handling, security equipment and dredging machinery.

Green Capital Goods

Machinery and equipment to help small to medium sized companies cut back on pollutants and waste.

Mining Companies

Exploration and extraction - drills, crushers, loaders and safety equipment are all in high demand.

India's Advantage?


Its competitive wages and cost structures.

Its robust laws protecting Intellectual Property that enhances scientific research and development.

Its three million IT professionals on hand to design state-of-the-art technology-driven machinery and equipment, as well as large numbers of skilled engineers and technical graduates.

How does the government help?


In most sectors, 100% FDI is permitted under the automatic approval route. Tariffs on capital goods and equipment have also been lowered to 0-5%.

On top of that, tax incentives apply to manufacturers investing big in plants and machinery.

India has signed free trade agreements with countries including Japan, Korea, Malaysia, Singapore and the trading bloc ASEAN.