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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?
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 India.

Q) Which are the developments spearheaded by your company that can be stamped as ‘indigenous’?
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 structure.
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 survival.

Q Are R &D efforts in the country being encouraged and adequately rewarded?
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 budget.
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”.


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