India’s manufacturing PMI rose to a three-month high of 56.4 in March 2023, up from 55.3 recorded the previous month, and topping the market forecast of 55.0. The business confidence index in the first quarter of 2023 stood at 132.9, slightly lower than the 134 recorded in the fourth quarter of 2022. In February 2023, production across the eight infrastructure sectors increased by 6% in the year-on-year comparison, with all sectors (coal, natural gas, fertilizers, steel, cement, electricity, crude oil, and refinery products) except crude oil seeing growth.
Domestic passenger vehicle sales jumped from 3.069 million in fiscal year 2021-22 to 3.3889 million in FY 2022-23, marking a 26.71% increase due to higher demand after the pandemic period. The pre-pandemic peak number was around 3.379 million.
India continues to make strides in the defense manufacturing sector. The defense production target is $25 billion, including $5 billion in exports, by the end of 2025. The present annual production is around $12 billion. The exports in FY 2022-23 reached an all-time high of $1.94 billion, a tenfold increase from 201617, when exports were only around $184 million.
With a focus on launching several semi-high-speed trains and achieving 100% indigenization in the railway sector, the government recently issued a tender to Ramakrishna Forgings and the Titagarh Wagons Alliance to produce and supply forged wheels for its trains and engines. In FY 2022-23, about 80,000 wheels, worth $63.5 million, were imported from China and Russia, and 40,000 more were sourced from the Steel Authority of India Limited. The requirement of forged wheels is estimated to increase by over five times by 2026.
According to the latest data by the India Cellular and Electronics Association (ICEA), India is likely to export $10-billion worth of smartphones in FY 2022-23. 50% of these exports are due to Apple’s “Make in India” smartphones, followed by Samsung with 40% of mobile exports.
Some recently announced projects and investment news items are listed below for your reference.
Lockheed Martin and Tata Group signed an MOU for fighter wing production in India from their joint venture facility in Hyderabad. Deliveries for 29 wing ship sets will commence in 2025.
Tata Advanced Systems (TASL) got a contract from Airbus to manufacture cargo and bulk cargo doors for the A320neo family aircraft. Each chipset would include two cargo doors and a bulk cargo door, and TASL will produce these doors at a new facility in Hyderabad using robotics and automation technology.
Boeing plans to set up a facility in India to convert 737 passenger planes into dedicated freighters. The deal adds to Boeing's $1 billion supply chain from India and will help support India's ambitions to become a global cargo hub.
Hyundai India inked a deal to acquire GM India’s Talegaon manufacturing facility. The company is investing around $500 million to launch several EV cars to supply domestic and export demand.
Apple supplier Foxconn has won the AirPod order and plans to invest $200 million to set up a new manufacturing plant in Telangana state.
Honda Motorcycle & Scooters India plans to install a new manufacturing line at their Gujarat-based factory. It plans to commission a 600,000-unit EV assembly line at its Karnataka-based plant by March 2024.
Schaeffler India plans to invest around $220 million to enhance manufacturing capacity at their Hosur-based plant.
PMI Electro Mobility plans to set up its largest electric commercial vehicle plant in Pune, Maharashtra. It would have an annual production capacity of around 2,500 units. PMI currently operates a manufacturing facility in Delhi National Capital Region with a production capacity of around 1,500 electric buses annually.
For more information, please contact Arun Mahajan at AMahajan@AMTonline.org.