At JCB, we remain positive about the India growth story.

Deepak Shetty

CEO & Managing Director, JCB India

How do you assess the growth prospects of the CE industry as a whole, in terms of finance and investments?

The Indian earthmoving and construction equipment industry has seen strong growth over the past decade. This has largely been due to the focus of the Government towards infrastructure creation across the country.

There has been sustained activity on projects which are of national importance such as the Sagarmala, Bharatmala projects. Additionally, the National Infrastructure Pipeline is a strong booster for our industry in the years to come. A proposed investment of over Rs.100 lakh crores over five years is going to be a significant growth driver for our industry. Additionally, the Gati Shakti programme will also be an enabler for the industry as we go along.

Also with the announcement of a DFI, a significant amount of stress towards long term infrastructure funding is expected to ease out.

At JCB, we remain positive about the India growth story. Despite the pandemic, we are continuing to invest in our Products, Technology and our Distribution network. We feel that with the vaccination drive gaining momentum, the sentiment will improve and we will see healthy growth coming back.

What do you think is the current status of the industry in terms of investments for training and up-skilling of talents?

Skilling is an important part of Construction and Earthmoving equipment. This is important because Skilling is directly linked to site safety and efficiency. As infrastructure projects start operating round the clock, and equipment deployed at these sites becomes more advanced, there is a need to establish safe working practices in the industry.

As an industry, we have made recommendations to the Government to have some form of mandatory training or regulation for skilling of operators for Construction Equipment. We feel that going forward this must become a focus area for everybody.

JCB is part of the infrastructure equipment skill council, IESC. We pioneered the concept of Operator Training Centres and today have 15 such institutes across India. We have trained close to 38,000 students over the past three decades on how to operate construction equipment safely. There exists a significant opportunity to formalise this sector and we are fully committed to supporting these initiatives.

Even for the Product Support Teams at JCB and its dealers across India, we conduct regular training sessions so that they are up to date in terms of the latest in technology and can improve the efficiency of these machines as they start working at worksites across the country.

What are your expectations from the government in terms of investment, policy changes for the Construction Equipment sector?

Over the past few years, we have seen a very healthy dialogue emerging between the Government and our industry. This is a welcome change because various issues around policy get highlighted, and the resolution of which is beneficial to the industry. For instance, there was a demand to create a separate Development Finance Institute, which has been accepted. This is important for long term Infrastructure funding of projects. We are very heartened by this move and would like to see this coming into play as early as possible.

On the other hand, Commodity prices and their unusual increase especially steel is creating a lot of stress in the sector. Coupled with that, the increase in diesel prices is creating stress in the system.

These are issues that need some resolution so that the industry remains competitive and we can ensure that our customers remain profitable. This commodity price increase also equally affecting the MSME sector which is vital to the supply chain for our industry. We have brought this to the notice of the government through dialogue and hope that there is some resolution around it soon.

We have already requested if the Construction Equipment sector can be eligible for the PLI scheme. This is because a lot of our supply chain is common with the automobile industry. This will also resonate with Made in India for the world and create opportunities.

How can investment be boosted from the private sector and how it can be pooled together?

The private sector plays a vital role in the overall development of the economy. Whether it is infrastructure development or other projects of social importance, the public-private partnership holds a prominent position in the overall development of the economy.

For the private sector to thrive a stable policy must be worked upon. For the private sector to come in and invest, it would be essential for them to see opportunities for growth if not in the immediate future, but certainly in the medium to long-term future.

This can be achieved by creating a policy framework that makes it easy to do business and stay invested.

What are the challenges related to the investment scenario for the Construction Equipment sector?

The Construction Equipment sector is fully dependent on the focus of the Government towards infrastructure creation. We look forward to the creation of more growth drivers, in addition to roads and highways which has been critical in the sustenance of our sector. Sectors such as Railways, Power, Irrigation, Mining are all areas where there can be even greater absorption of machines produced by our industry.

We see railways emerging as an important part of the overall infrastructure landscape in India. The budget has also made significant allocation towards the modernisation of assets in railways. Similarly, socio-critical projects such as the availability of drinking water can also be a significant growth driver for our industry.

The Construction Equipment sector in India is today at par with the rest of the world. JCB India for instance produces machines that are exported to over 110 countries around the world. All products made in our five factories today are to One Global Quality. We have remained committed to the India Growth Story over the past four decades of our operations in India and will continue to remain so.

There are other concerns also that need urgent attention. High logistics cost and availability of shipping containers being a few of them. 

However, at a macro level, the focus on Infrastructure development must continue and we must aim to be the second-largest market in the world by 2030.

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