Murali Venkatraman, the new President of Indian Electrical & Electronics' Manufacturers' Association, talks about a host of topics ranging from Elecrama-2010 and India's performance in the power sector to IEEMA member-companies and issues concerning the power sector. An interview by Venugopal Pillai and Sandeep Menezes.
To begin with, what are your thoughts on Elecrama 2010?
As far as Elecrama is concerned, we have had a fundamental change in concept. Using the past few Elecramas, what we have been trying to do is to build up the credibility of the exhibition, per se. So, we now reach out to different segments of the Indian T&D manufacturing and contracting base. We also want to invite international participation. You need to have a mix of both to build the credibility. That worked very well and in Elecrama 2008, we saw a very qualitative change. This year when we opened we were at the peak of financial difficulties. So we are a bit concerned as to what the reaction would be. Surprisingly, the whole place was sold out within two months of opening. But this also means that peoples' expectations have gone up and we need to make sure that we deliver to meet those expectations.
For instance, in times of slowdown, every rupee counts. We were told by many companies (even international) that they have cut down spending on all exhibitions, except Elecrama! This only shows the importance of India as a market, and also suggests the great responsibility that IEEMA is shouldering. We are now actually marketing Elecrama globally as: "Come here to see the complete length and breadth of the complete range of products and services in power T&D sector." We are using a combination of roadshows, reaching out to an international database etc. We have consultants and partners advising us on this. We have touched every part of the globe, except, say, South America. We have even got help from the ministry of external affairs to reach out internationally.
In Elecrama 2008, we had 2,000 international visitors. For this event, we are aiming at ten times this number. The idea is also to have a right profile of visitors. We want people that are relevantdecision makers for procurement, utility engineers, ministers who are handling the power sector.
Our power generation sector has come under much criticism for poor performance in the 10th Plan period. Do you think our target of adding 78,000 mw in the 11th Plan will be met?
Honestly, I think it is going to be a very difficult task. The primary reason is twofold. Generation projects, unlike T&D, have much more longer gestation. They also have external implications like land acquisition, coal linkages, port management (for imported fuel), attaining financial closure that depends on the credibility of the buyer of power etc. There are a host of complex issues spanning across ministries and a multiplicity of agencies.
The way the coordination process runs at the government level, it is going to be a very tall order to see this (the target attainment) happening.
We observe that the T&D sector is picking up with superior technology like 765kV substations and HVDC lines.
The T&D sector has always been a quiet performer. If you look at the 10th Plan achievement, it was quite respectable as far as T&D goes. If you leave distribution out of it and talk only about transmission, the achievement in the Plan was more than 80 per cent. Even if you look at the first two years of the 11th Plan, I think on an average about 60 per cent or so of the planned projects are already in line.
What is going slow are the 765kV line projects, because they are largely linked to ultra mega power projects. The interregional connectors are now going on. I would say that in terms of moving power from surplus to deficient regions, there is enough to be done to keep everybody busy for the next two-three years. It is probably only later that the virgin transmission network (UMPP evacuation) would come up. This will come up only in conjunction with the commissioning of the power projects. At IEEMA, we not too concerned about the slowing down of the transmission sector.
What about the slowdown impact on the electricals industry?
I do not think that the electricals sector even had a fraction of the slowdown pains that other sectors went through. Yes, prices have been under pressure and the challenge is to retain margins like before. Honestly, being in power infrastructure, I could say we had a mild flu when everybody else was in ICU (intensive care unit)!
How are matters on the power distribution side?
Distribution is a big issue because it is linked to the ability of state utilities to finance their capex plans, which in many cases is suspect. Till the first phase of the R-APDRP, which is collection of nationwide data, is done, implementation of new schemes will be put on hold. So there will be some time before RAPDRP (restructured accelerated power development and reforms programme) projects gather speed.
How can India's power sector support economic growth?
One will have to come up with a lot of innovative solutions. The long-term dependence on fossil fuels (thermal) should come down. So nuclear is one answer. We need to do far more in terms of usage of renewable energy-solar and wind. You need to go into a large extent of standalone (distributed) type of generation, where each group of village or a town, for example, has its own power generation plant.
How has been the performance of IEEMA members?
If we look at IEEMA's performance in 2007-08, we grew at around 18-20 per cent on average. Last year, it dropped to 3 per cent or so. But if you analyse this 3 per cent, many of the verticals in the transmission side like projects, transformers, they grew by 12 per cent. On the other hand, some showed negative growth. These were largely those that were focusing on the industrial market like rotating machines, low voltage equipment for the distribution sector or products related to real estate projects, cables for instance.
How have IEEMA companies fared this year?
If you look at the first quarter of 2009-10, the top line growth has been flat. Most of the companies had a better bottom line which was more a result of managing costs more efficiently. My own feeling is that the second half should be better. The full benefit you would see only in 2010-11, or maybe the last quarter of this year.
Finally, as IEEMA President, what would be your three most important objectives?
One, we want to actively promote 'Made in India' as a brand. Second, we want to see something significant happening on the technical competency side of IEEMA members. And third, work with SMEs within the membership to improve their own competency, skill sets, quality etc. Our success depends on them. We have a number of initiatives for this category like the "quality awards" that we are having this year. In fact, recently we had a meeting with BEE (Bureau of Energy Efficiency) to see how we could bring about the concept of energy efficiency in products rolled out by SMEs.
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