Low cost lends edge to Indian manufacturing

PUNE: There isn’t an Indian way of doing things, although the country’s manufacturers have shown that they can make small batches of products in a cost competitive manner. This only proves India’s competitive strength lies in ‘frugal engineering’, a phrase coined by Franco-Japanese automaker chief, Carlos Ghosn.

Since Indian manufacturing lacks the scale that China has, it needs to evolve its own model, Satish Sekhri, managing director, Bosch Chassis Systems, said.

He was emphatic that Indian industry should evolve a unique method, which takes into account our social fabric, sensibilities and competencies. Indian manufacture is able to make small batches with a large variety.

He was speaking at the ET Global Manufacturing Competitiveness forum focused on the manufacturing sector in Pune recently. Added Pradeep Bhargava, managing director, Cummins Generator Technologies, that Brand India was created by the software industry on which the manufacturing sector has piggy-backed.

“India will be able to retain its cost competitive location as a low-cost country. Our cost competitiveness is being measured against western Europe and the US, not against China. And even against China, the cost difference is 5-10%,” Mr Bhargava noted.

Even as the panellists spoke of infrastructure bottlenecks, leading to delays and longer turnarounds, Deepak K Chhabria, managing director, Finolex Cables, pointed to the skewed tax structure.

Arvind Sethi, partner, Ernst and Young (E&Y), who moderated the event, pointed to the many multinational companies which are locating their research and development centres in India.