Indigenous Technology & Import Substitution
Interview of Director Marketing Mr. Anuj
Aggarwal in Technology Trends, August-2006 issue
Interview Published in the issue
Q) Does talking of ‘Indigenous technology & import substitution’ mean anything in today’s context?
Q) Which are the developments spearheaded by your company
that can be stamped as ‘indigenous’?
A) Yes ‘indigenous technology & import substitution’ has
a great impact in present. At present the imports have become very easy for the manufacturer, government has given many tax benefits, more recent changes in
the tariff policy, import-control policy, and technology-import policy etc which helps the manufactures to make the quality product in cost effective way.
All this helps the manufacturer to make the presence in international market.
But, what if the supply is being stopped by the countries
from where we import??? Import no doubt is good for our development but too
much dependent on other nations is not good. There are some areas where we have
to be self reliant in order to make our presence at global level. There are
some crucial areas where if we are too much depended on the import it will harm
us. These areas are like security, infrastructure, technology etc. If we want
to become strong in crucial areas we have to go for indigenous technology.
Initially, we have to import the technologies to get an
idea what quality is expected by the customer at international level. Hence, we
have to spend a major amount on the R&D to make ourselves strong. For eg;
due to immense R &D the Indian machine & tools industry is recognized
as a provider of low cost high quality lean manufacturing solutions.
Machine Tools industry forms the pillar for the competitiveness of the entire
manufacturing sector since machine tools produce capital goods which in turn
produce the manufactured goods. Hence being an integral sector, growth of the
machine tools industry has an immense bearing on the entire manufacturing
industry which is crucial for the country's strategic requirement such as
defence, railways, space, and atomic energy.
In India, indigenous machine tools have
the highest impact on capital output ratios. From the mid eighties onwards the industry has
relied entirely on its own R&D efforts to develop and market a contemporary
range of CNC machine tools. The present turnover of the industry is totally
from products developed by the industry in the last decade.
The Indian machines are yet to be developed to offer the higher capabilities, which are increasingly required by all industries in
A) The developments spearheaded by our company which can be
stamped as ‘indigenous’ are the Pump Jack helical gearboxes which we
manufacturer as per the requirement of our customers.
Pump jack helical gear boxes are used in petroleum oil
fields for rigging purposes.
Presently Agro Engineers is engaged in manufacturing Pump
Jack Helical gear box from torque ratings 10,000 IN. LBS to 40,000 IN. LBS and
working on designs of 57,522 IN. LBS to 929,204 IN. LBS.
Q) What have you to say on the role of R&D institutions
in development of new technologies/products?
A) The Machine Tool Industry is the backbone of the Industrial Sector and is vital for the growth of the capital goods
industry. Even though the Indian machine tool industry forms a small segment of the engineering industry, it plays a
very important role in its development and technology up-gradation. The quality and cost of engineering products depends on the quality of parent machine tools
and their automation levels. The development of machine tool industry is therefore of paramount importance for a competitive and self-reliant industrial
Hence various institutes were established like Institute
for Machine Tools Technology (IMTT), Central Manufacturing Technology Institute (CMTI) etc.
The priority of the Government for establishing institutes
was to upgrade the technology. Therefore, the primary attempt of the existing
institute for machine tools technology is to provide technical services in
terms of new designs, precision engineering facilities, laboratory and testing,
expert advice and training.
The purpose of these Institutes is: “To support industries
to achieve excellence in technology and stimulate economic growth.
The Institute has been playing a major role in filling the
gaps in manufacturing technology and improvements in energy efficiency in
production processes that were either not developed by the indigenous industry
or were not available to industry even through imports.
The main objectives is to increase the level of technical
competence in the areas of machine tools and manufacturing technology,
strengthen the industrial capabilities leading to improved production methods,
process controls and standardization resulting in increased competitiveness,
efficiency and productivity.
Today organizations are knowledge based and their success
and survival depend on creativity, innovation, discovery and inventiveness. An
effective reaction to these demands lead to innovative change in the
organization, to ensure their existence. The rate of changes is accelerating
rapidly, as new knowledge idea generation and global diffusion are increasing.
Creativity and innovation have a bigger role in this change process for
Q Are R &D efforts in the country being encouraged and
A) As buyers are becoming more sensitive, manufacturer can no
longer rely only on their low production cost to gain a competitive advantage.
Buyers' concern about cost-effectiveness is driving manufacturers to improve
product quality even while keeping prices competitive.
Besides improving their quality, many suppliers are also strengthening their ability to meet customers' various
design requirements. In line with this, manufacturers maintain in-house R&D
teams consisting of chemical, mechanical, metallurgical or automotive engineers
with several years' experience.
Many suppliers are concentrating R&D efforts on replicating a customer's design within a short period of time and on a low
At this point, in order to give encouragement to research
and development in industry, DSIR instituted National in-house
R&D awards for outstanding R&D achievements of Indian
Industry in the year 1988. During the past 18 years, 155 such R&D awards
have been presented by DSIR.
Till the year 2000, the eligibility for these awards was
restricted to those industries whose
in-house centres were recognized by DSIR. Since the year 2001,
these awards were open to all units of Indian industries,
registered as corporate companies, which may be
public limited companies, private limited companies, partnership
or proprietary concerns registered in India. DSIR Department
of Scientific & Industrial Research) is the department for granting
recognition to in-house R&D units in Industry. Government has come up with
IRDPP to encourage R&D in country. In this some incentives are
introduced by government which includes write off of revenue and capital
expenditure on R&D, accelerated depreciation allowance on plant and
machinery set up indigenous technology, custom duty exemption on goods imported
for use in Government funded R&D projects etc.
“A better R&D will help manufacturers to meet the standards”.