The government needs to finance MSME's and keep them afloat in this crisis.

The long-term growth for construction and earthmoving equipment is intact and positive.

Sandeep Singh, Managing Director, Tata Hitachi

Tell us about the challenges faced due to Covid-19 and its impact on the Construction Equipment sector and overall economy?

Clearly, it has been a challenging year.  Till YTD Feb for the 3 major segments - excavators, backhoe loaders and wheel loaders - which comprise a major portion of the CE industry by volume - the YoY growth has been negative 19% growth over the same period last year. The industry has been adjusting production due to the slowdown and many firms have been announcing production holidays through the year. Therefore, production was gradually calibrated to meet market demands and inventory adjustment was a continuous process.

As far as impact of Corona virus is concerned, it has come as a sudden factor in this month, we are evaluating the situation and will take necessary action as per market requirements. With the outbreak of Covid19, it is difficult to assess the prospects for the upcoming year and we need to see how the situation evolves.

How do you assess the government's commitment to trigger the growth prospects?

The government has committed to substantial investment in infrastructure over the next five years as detailed in the NIP. Nearly 70% of that investment is envisaged in infrastructure - 35000km Bharatmala project - 10000km awarded, and balance 25000km to be awarded in next couple of years. The intent is to build infrastructure to increase competitiveness of the country, increase output and improve ease of doing business.          

The second focus is in building more advanced infrastructure like high speed railways, (MUM-AHD) (Rs. 1.1 trillion, Rs. 1.1 lakh crores,    USD 15.5 billion), expressways, (800km under Bharatmala), smart cities, (100 cities: Rs. 2.03 trillion, Rs.2.03 lakh crores,    USD 28.1 billion approved), and smart infrastructure etc.  

How do you foresee the long term growth prospects?

The government has initiated various steps for accelerating infrastructure development. Investment and implementation of key projects along with corrective measures and industry friendly policies of the government, we believe will greatly help the infrastructure development in our country. Therefore, the long-term growth for construction and earthmoving equipment is intact and positive.             

We expect demand to slowly recover over the year - once we recover from Covid19 - given the above focus on the above as well as the various measures taken to improve business sentiment and availability of liquidity. We believe that India's infrastructure sector is poised to grow significantly with the increasing demand for development of key infrastructure projects such as roads and highways, rural connectivity, urban infrastructure including metro rail projects, ports and airports, industrial corridors, smart city projects, etc.      

What will be your revival strategy to handle the situation post the lockdown?

The sales numbers came to an abrupt halt after the lockdown. It will take some time before the demand levels come back to pre Covid levels. It will need a carefully calibrated approach by the government to keep the MSMEs (many of whom are our vendors) afloat and also revive financing in this sector (which is largely conducted through NBFC's). Meanwhile we are keeping up our engagement levels with our dealers by making regular payments against services that have been rendered, on line training at various levels and frequent leadership communication. Our sales force is also keeping close contact with our customers and offering online support services.      

Through our industry association, we have also represented to the government about the issues impacting our Industry and the urgent need for intervention.  

What are the measures being taken to support the migrant workforce?

Our Dharwad plant distributed grocery packets to migrant workers and laborer's in the presence of the Dharwad West MLA Arvind Bellad. The grocery packets were handed over by. Balavijayan - Vice President SCM and Dharwad Administration, G B Kulkarni - Plant Head, Dharwad and Prashant Dixit - Senior Divisional Manager (Admin and CSR, Dharwad).  500 packets were distributed, each one providing support for two weeks.   

Tell us about your CSR initiatives during this difficult time?

Tata Hitachi works, traditionally, with the stakeholder communities in the villages around our plants in Kharagpur, West Bengal and Dharwad in Karnataka.We work extensively with these villages in improving the education and health infrastructure as well as rural development and skilling. With the sudden and catastrophic advent of COVID- 19 in the country, we reached out to the district administration in both these areas and have undertaken a series of activities supporting the fight against this menace.            

These include supply of facemasks, hand sanitizers and thermal scanners. Apart from this a disinfectant tunnel has been designed and developed by us and handed over to the district hospital in Dharwad. We have partnered with CII, Karnataka in Bangalore, again for supply of sanitizers and thermal scanners. We have also supported YI (Young Indians, a part of CII), a group of young volunteers who have undertaken relief work in Karnataka. Support for stranded migrants and daily wage workers have been offered through the FeedmyBangalore initiative.    

A contribution has been made to the Relief Fund in West Bengal and we are gearing up to supply food rations and a health Kit to some of the villages in Kharagpur through CII and NGOs.

As part of ICEMA, the Indian Construction Equipment Manufacturers Association, we have created sourcing teams from across members to identify vendors of critical PPE as well as parts for ventilators. ICEMA has also created a fund to support the COVID- 19 relief work. We know the effect of this pandemic would be deeply felt and extensive and the efforts of the government would be continually supported by us.

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