January 2004
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Overview of metal casting Industry in India

See also >
Indian Forges report

 
     
 

India is the fifth largest producer in terms of total casting production in the world, after US, China, Russia, and Germany. In terms of number of production units, it is second only to China, with over 5000 units in actual production. Of these about 90% of them are in small scale & unorganized sector, but it still leaves about 500 units which are in the organized, & are medium to large in size.


Foundry Industry in figures

Production

Grey Iron castings
Steel castings
Malleable ans SG Iron
non ferrous castings

3 millions tonnes

2.36 million tonnes
400 000 tonnes
268 000 tonnes
20 000 tonnes

5th producer in the world
 

Number of plants 5000 (estimated)
500 medium to large scale

 

Modernisation

While these foundries have always striven to be up to date with modern casting technology & practices, the year 1991-1992 was a watershed in the development of the Industry. With the Indian government taking the path of de-regulation, open economy & globalization, many new green field foundries were set up, with modern equipment like High pressure molding technology, automatic sand plant and latest in NDT like spectrometer, magnetic particle testing, ultrasonic & X-ray examination.

Entry of many multinational units post 1992 particularly in automotive sector helped the shift from small scale single owner driven foundry to medium / large sector with professionals inducted even at departmental levels like molding, & methoding, melting, production etc.

Assimilation of modern technology like simulation software, 3-D modeling of the drawing, use of computers in solidification simulation, has brought the Industry at par with the best in the world. Due to the intrinsic better understanding of the drawings, modern equipment, lower labor costs etc, has made the Indian Casting Industry globally competitive.

Competitiveness of Indian Foundries

After the initial phase of increases in installed capacity, due to domestic recession which lasted almost till 2001-2002, came the period of shake out, with weaker units either folding up or getting merged with the stronger players. Now, since the domestic demand has picked up since last 6 months, the better units are now working almost to 85-90% of installed capacity. This lean period forced the better foundries to downsize, and increase the productivity, to fight the diminishing margins. This has made those who survived a fitter & stronger foundry highly competitive in the world market.

Unlike the Chinese growth in export markets (which in volume / tonnage terms is far greater than the Indian one), Indian export growth has come in high end cast products, higher technology & complicated shaped castings, serving the Industries like auto components, pump & valve Industry, mining & minerals & earthmoving machinery etc.

India has perhaps the largest pool of engineering manpower, with 95% able to speak & understand English, offshore product development activity is possible. With about 4-5 hours of time zone difference actually helps in working virtually in real-time. With very low machining costs, (and matching facilities like heat treatment, plating and painting operations) India is fast emerging as a hub for purchase of ready to use components (instead of mere casting) or at least a semi-finished component, with only finishing operations done in Europe.

Additional area where Indian foundry Industry has made a mark is in the are of value engineering, and cost reduction, like conversion from Steel casting to ductile SG Iron casting, from Malleable iron casting to ductile iron casting, from forging to casting etc.

Investments to boom in 2004

In the last few years, large MNCs like GM, Ford, DaimlerCrysler GE Cummins, Caterpillar etc have opened their international sourcing & strategic buying offices in India to take the advantage of lower cost, good quality castings from India. Along with these a large number of Tier I & Tier II companies have also either set up sourcing offices or have set up assembly plants in India and are sending the castings / components as a buy back strategy.

With the boom in local industry and the equally strong export performance, most foundries have drawn plans for capacity balancing, and expansion over next 12-18 months, with total investments of around 2000 million Euros at macro-level.

 

 

 
     
     
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