Last year was quite eventful one for the Indian metals sector, full of ups and downs and filled with enormous uncertainties. Let’s have a look.
Though the availability of vital raw materials has improved over past 2/3 years, depressed oil prices and overall subdued environment on a global level has to have its effect on every country’s economy. In today’s networked world, no country can progress in isolation. India too was affected by the global slowdown which has now been referred to as ‘New Normal’.
Nevertheless, India’s auto sector has been putting up an impressive performance for the last few years and continues its upward path this year too. The monsoon is also good this year which means the tractor demand will surge. Good news for foundry sector indeed ! The non ferrous metals demand depends on many consumer industries but is mainly linked with infra and construction sector. Their fortune is firmly tied up with these sectors. Building of roads, bridges, ports, airports, metro projects, dams etc. will consume huge amount of metals and thus will give a boost to metals demand in the country. For India, most period in the last year was under the influence of demonetization and implementation of newly framed Goods & Services Tax (GST). Though one can argue on the long term benefits of these steps, they naturally affected the performance of atleast first three quarters of the fiscal 2017-18. The industry somewhat recovered and stabilized by the end of 2017 and thus the Indian economy grew at the rate of 7.5 % during Jan-Mar 2018.
Now that the Indian metals sector has crossed most of these hurdles in the growth path, one can be little more optimistic for the coming period. Also, the central government’s focus on MSMEs should put the Indian metal producers and processors in a position to cater to the growing demand in the country. As such India is seen as one of the few growing economies in the world and a lot of overseas companies are wanting to enter into this growing market. I feel that India is in the right place at the right time. Only time will tell how much benefit it can extract out of this situation !