The Indian infrastructure sector, primarily
power, holds great significance for the central government as it plays
pivotal role in the overall economic development of the nation. It has
been found that the electrical equipment industry enjoys prominence in
the infrastructure development of power sector. In the past, the sector
made use of low cost labour and also strong manpower base to strengthen
its presence in the global markets as an efficient exporter and also
producer of electrical equipments.
Overview of Indian electrical equipment industry-
The Indian electrical equipment industry has a chequered history. It is among the fastest growing industries in India and meets demands of various sectors. Although, this industry is highly fragmented in its basic nature, but still the small and medium enterprises (SMEs) enjoy considerable presence in this sector.
Analysts believe that over 90% of the electrical equipment manufacturers in India are SMEs. In regard to the overall output, it is projected that close to 25-30% contribution is accounted by the SMEs in this sector.
Presently, this industry covers more than 1,500 units of different sizes, accounting for an annual turnover of close to Rs 1,10,000 crore. Out of the net amount, annual exports' share stands at Rs 20,000 crore, while annual imports at Rs 32,000 crore.
Meanwhile, the Ministry of Heavy Industries and Public Enterprises claimed that employment need in this sector is projected to appreciate to 35 lakh during this year.
According to government's projection, the electrical equipment industry offers direct employment to 5-lakh people and indirect employment to more than 10-lakh people.
Currently, there are many challenges witnessed by this sector such as volatility in the raw material mainly metal prices, substandard quality of raw material and inputs, poor investment in R&D apart from the growing shortage of skilled technical manpower.
Possible reasons for manpower shortage
The rising problem of skilled manpower is causing demand gap and it is rising steadily with the passage of time. The increasing crisis of skilled manpower is impacting various key functions of the electrical equipment industry such as R&D, consultancy, design and detailed engineering work, according to the Ministry of Heavy Industry and Public Enterprises.
The labour productivity has also been low in this sector due to various reasons. As the technical education system in India does not promote innovative thinking, training which is offered in the Industrial Training Institutes (ITIs) is outdated in nature. It is also one of the reasons why the students are not able to fulfill the aspirations of the industry. Even, the qualified supervisors and engineers are not available in significant numbers. The people who are qualified, they are not well trained to fulfill the technical requirements of the industry.
Furthermore, various engineering graduates are of the opinion that the electrical equipment industry lacks considerable growth prospects, leading to limited career options and insufficient salaries. It is leading the new-age students to opt for other high paying sectors such as Information Technology (IT).
It is believed that this demand-supply mismatch can be solved with the upgradation of the present curriculum followed by the engineering colleges across India.
How to improve manpower crunch
· Experts believe that the technical institutes needs to make it absolutely compulsory for teaching staff to spend 3-6 months every 2 years in the industry. It will prove to be beneficial for the continuous upgradation of their knowledge.
· Government should unveil courses which will make one semester of internship in the industry compulsory for students. It will comprise of classroom to hands-on training, improved laboratories to display the latest technologies and products.
· Motivate students and teachers to attend technical seminars on the recent technologies to stay connected with the current developments.
· Develop exchange programmes for teachers across various technical institutes and also with technical institutes of other nations.
· Centre should ensure industry representation in the Education Board for creating curriculum that will showcase the latest technology trends and industry needs. Modules can also be prepared on the basis of industrial clusters along with the course curriculum.
· Indian government should offer extra funds and facilities so that the technical institutes stay upbeat.The financial institutes should aim to offer interest-free loans to technical institutes for upgrading their facilities.
How labour crisis is impacting growth of the electrical equipment Industry -
According to recent reports, the skilled labour crisis has started to impact productivity in a huge way as it has gone down considerably when compared to China and Korea. This is also one of the possible reasons for making the industry non-competitive in nature and also affecting the timely completion of the projects.
Moreover, the growth of India's electrical equipment industry slipped to 6.6% during 2011-12 as compared to 13.7% during the previous financial year 2010-11, as per Indian Electrical and Electronics Manufacturers' Association (IEEMA).
Reports claim that the growth in capacitor, switchgear and transmission line segments became negative during 2011-12.
Many Indian companies supplying electrical equipments to power plants have started to operate their factorieas at half the capacity due to the poor implementation rate of projects and also stiff competition from China and Korea.
Moreover, they have started to pay extra prices for inputs such as copper, steel and aluminium. Also, the Indian suppliers are compelled to lower the selling prices by 15-25% to withstand flood of imports from China and Korea. On an average, the foreign goods are close to 20% cheaper compared to the Indian equipment makers.
Although, the electrical equipment industry is sailing in rough waters, but there is a ray of hope for the survival of this sector. IEEMA has said that the industry is hoping exports to witness six-fold jump to reach $25 billion within one decade. It has been holding regular interactions with the Department of Heavy Industry and the National Skill Development Corporation (NSDC) to establish skill councils for this ailing sector.
Global companies aims to tap the Indian electrical equipment industry
International electric equipment firms with deep pockets are eyeing to raise their foothold in the Indian market due to the stagnation in the developed countries. In India, the demand for electrical equipments are on the rise due to the growing real estate and power sectors.
The companies in this sector want to position themselves as 'one-stop solution' provider to the customers, who come from both retail and industrial sector.
Conclusion
Many feel that despite the importance of this growing industry, it has failed to catch the attention of the policy makers. Government along with the representatives from industry bodies need to chalk out plans to boost the growth of the sector.
Great salary, perks along with benefits may not always ensure low attrition rate. Companies need to ensure job satisfaction of the employees as well.
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