How has your organization strategised to tackle this sudden pandemic and economically challenging scenario? What measures have you taken going by embracing the mantra of social distancing?
With the gradual un-locking of the economy, the construction activities are seeing some revival across India. JCB India too has resumed operations with activities in our factories and offices gradually resuming. Hence, our utmost priority is to safeguard the health and safety of our employees.We are ensuring that all activities at JCB facilities and offices across India are as per well laid out SOPs while also observing highest standards of safety and hygiene for our employees.
As markets are opening up, the re-booting of the supply chain is also important so that the supplier and the dealer networks become seamlessly operational once again. We are seeing a gradual recovery, but despite the green shoots, the recovery is currently cautious due to the uncertainty in the environment. The industry can get extremely challenged if multiple cities where our suppliers, dealers and customers are located go into a lockdown once again. Our supply chain is spread across India and any disruption in one part of the country can affect operations and can have a cascading effect on the business.
Through LiveLink, our advanced Telematics technology, we see a recovery in equipment utilisation in our equipment. Despite the uncertainty, this is encouraging for us.The last quarter of the calendar year will play an important role for the entire industry.
There have been some green shoots in recent weeks. What is your assessment of the same? Company’s stance on Construction Equipment segment of the country
With markets opening up, we are seeing a gradual revival of construction activity in the country. Infrastructure projects are restarting, which is a positive sign for us. A strong focus, along with a sustained spend on infrastructure development would result in multiple long-term benefits with the construction of roads and highways playing a pivotal role. Hence, continuation of Government’s focus on construction activities and on infrastructure development is vital for our industry’s revival. This would also give a strong push towards growth to the allied industries like construction equipment manufacturing, mining, coal, cement, etc, while also creating jobs and livelihood.
Going forward, two key sectors are set to emerge – first being Infrastructure development in Rural India and the other is the creation of a world-class Healthcare sector. The movement of migrant work force will give an opportunity to create a better rural-urban re-balance. Thus, schools, colleges, hospitals, dispensaries, etc, all need to be scaled up and segments like municipal waste, village roads, rural infra, village infra are set to grow. This, in turn, would result in increasing the demand for construction equipment.
The pandemic has also forced us to assess our readiness in the Healthcare sector and the focus on development of health infrastructure in India is also expected to spike up. Building and opening up of new health and wellness centres would reduce burden on the secondary and tertiary healthcare facilities, especially during the rising stress on the health infrastructure amidst the unfolding crisis. All of this would result in greater application and demand for construction equipment.
The Government has committed an investment of INR 111 lakh crore into the National Infrastructure Pipeline and also in frontloading some large projects. This has certainly brought in positive sentiments. However, this proposed plan must continue as the revival of the infrastructure sector will create demand with a multiplier effect.
At a national level, Railways and large projects like Sagarmala must continue to be given impetus to strengthen the logistics network and develop requisite infrastructure aimed at enhancing capacity at ports, improving operational efficiency and connectivity to enable a smoother flow of traffic.
However, there are also some challenges. For these infrastructure projects to be successful, liquidity is essential. The pandemic has made Banks and NBFCs even more risk averse. Transmission of liquidity is critical for our industry – the RBI has done a lot in the past few months and the benefits need to be passed on to the end users. The risk appetite should not become nil.
NBFCs are very important to Construction Equipment financing. Restructuring of bank interest rates and last mile lending from NBFCs could be instrumental in the rapid recovery of the industry. The reforms announced by the government are aimed to improve demand consumption and improve liquidity.
Additionally, MSMEs play a very critical role in India’s economy and also in our industry. From generating employment to maintaining consistency in the domestic and global supply chain, the sector is the backbone of our economy. Under the recent economic stimulus package, the Government has announced a slew of measures such as allocation of INR 3 lakh crore for collateral-free automatic loans, subordinate debt and equity infusion through MSME Fund of Funds. These are aimed to support their growth potential and viability. The OEMs have also been actively supporting MSMEs through business, skilling/ training initiatives, funds for new technologies, etc. MSMEs are the hub of all on-ground innovation and employment in India.
Now as the Nation is in unlock what would be your organization’s agenda for future?
Now that the country has entered into the fourth phase of ‘Unlock’, we are seeing a revival of construction activities and infrastructure projects, which is a positive sign for us.We are therefore, positive and hopeful for the future. As the thrust on infrastructure creation continues to be a priority for the Government, we are optimistic of a recovery. Rural India, where we have a significant presence, is also set to emerge as the new growth driver for us in the coming days. With over 700 outlets in India, JCB India is staying as close to our customers as possible.
With over four decades of being in India, JCB has always remained committed to its customers and their needs. We have always been aligned towards manufacturing products that deliver a combination of value, new digital technology and world-class quality. With five state-of-the-art factories operating on the principle of ‘One Global Quality’, and sixth one underway, JCB India has been indigenously designing and manufacturing a wide range of technologically-advanced equipment for India and over 110 global markets.
Our long term vision hence, is to ensure that our customers get technologically advanced and innovative ‘Made-in-India’ products, thereby contributing to making India a global manufacturing hub.Through this indigenous manufacturing of globally competitive products, we are also ensuring our support to the Government’s AtmaNirbhar Bharat Abhiyan.
As the world goes digital, our pioneering efforts in integrating our businesses with digital technology, both in Products and Product Support, gives us an advantage. We are confident that with our global expertise and our range of smart machines, we are well positioned to leverage the opportunities ahead.