The dynamics of the Indian pump industry

On May 31, 2013

Mr. S. L. Abhyankar

While India has been an attraction for more and more global players to set up shops in India, our indigenous manufacturers have shown commendable entrepreneurship to foray into the global market exporting to some 70-odd countries around the world with their own brand names, says S. L. Abhyankar, the Pitamaha of the Indian Pump Industry , reflecting on the status and prospects of this dynamic industry in an interview with P. K. Balasubramanian. Excerpts:

Q. What you have to say on the economic scene in the country and how conducive is it to accelerated alround growth?
Economy of the country and its GDP comprises contributions from Agriculture, Industry and services. Pumps are important in all these. Status of the industry depends very much upon the economic conditions of these sectors. Parameters of economics of these sectors themselves are different.

In the agricultural sector, vagaries of monsoon, availability, quality and reliability of power and purchasing capacity of the farmers influence pump industry. In the industrial sector, investment climate is a major influencing factor. The market for pumps consists of project requirements and replacement demand. Major influencing factor is of project-requirements and that depends upon investment climate.

In the services sector, the major influencing factor is pace of Governmental initiatives, especially for infrastructure projects, such as of power-generation, water supply, sewerage, transportation, etc.

Q. How satisfying is the transformation and growth of the industry?
Salient points of growth of industry have been :

Market for pumps in India has been some attraction for more and more global players setting shop and also exploring setting up manufacturing facilities in the country.
On the other hand, indigenous manufacturers have shown commendable entrepreneurship to foray in to the global market, exporting to some 70-odd countries around the world, with their own brand names. This performance is of course influenced by the economic conditions around the world, which, unfortunately, have not been very positive over the last few years.
Governmental support to promote exports has not been worth mentioning. Also it makes poor comparison with Governmental support in countries like China. So, if Indian pumps are getting exported to as many as 70-odd countries, the credit should go to entrepreneurship.
The export performance also evidences that the industry has matured in all related aspects of engineering, technology, and quality.

Q. When it comes to contemporary technology, are we in step with the world?
One aspect of contemporary technology is use of tools such as Computational Fluid Dynamics (CFD). A few years back, the technological up-gradation started with manufacturers having computerized pump testing facility. That seems to have become almost an industry norm. Mention of CFD also does not cause eyebrows to be raised any more, though the costs are yet prohibitive for its use to spread.

Manufacturing technologies such as sheet metal construction were thought to be capital-intensive a few years back. But it seems that the technology has become sort of indigenized. Similarly, impellers and casings to be replaced by by investment casting process was also not cost-effective a few years back.

Some of our frontline manufacturers are striving to be global players, figuring in the top slot. What are the challenges they are facing?

Q. World-ranking of manufacturers does not really make a clear picture?

Pump-manufacturers world-wide often have their turnover comprised not just of pumps. In many cases they have package-units of pumping systems for different applications or have project-activities such as EPC contracting.
Recognition as global player has many connotations. One connotation also comes from having manufacturing plants at many places around the world. An alternative to setting up manufacturing plant is to acquire existing manufacturing plants.
Such venturing becomes a matter of corporate strategies of marketing and fiance-management. Becoming a global player, to my mind, should not be looked at as an objective in isolation. It should happen as a natural sequel of the corporate strategies.
I have seen even so-called global players having 3-4 competing brands under one umbrella. I am not convinced of such acquisitions.

Q. These days there’s so much of stress on energy efficiency of Pumps. What are the efforts of the industry to develop energy efficient products?
Energy-efficiency of pumps should not be looked at as energy-efficiency of only the pumps. A good pump in a bad system cannot be as energy-efficient as it should or can be. Yet, it is not illogical to demand the pumps to be energy-efficient by themselves. If the system is good and the pump also energy-efficient, it becomes the most appealing and satisfying achievement.

The subject is a matter of concern, specifically in the agricultural sector, where the user, the farmer is not literate, much less, pump-literate. The farmer also pays almost nothing for the energy consumed for agricultural pumping. It was possibly with these considerations, that BEE took the initiative to evolve a star-labeling scheme for agricultural pumps. Unfortunately, the scheme is still having too many pit-falls and hence has not been able to make any impact in the market-place.

In industries pumps are procured, installed and run with quite some technical manpower involved at all stages. Yet any number of pumping systems in industries may not be as energy-efficient as they can or should be. In most cases the engineering personnel are not adequately ‘pump-literate’. In industrial pumping, demand for reliability may often cause compromise with the need for energy-efficiency. Even the standard API-610 has been mentioning “efficiency’ not being the all-important criterion.

In many large infrastructure projects capital cost of pumping machinery may be barely 5 percent. Yet the success and overall positive assessment of the project would be dictated by the performance of the pumps. Even in human body of average weight of 60 kg, weight of heart is 250-350 g. (300/60000 = 0.5 %). But performance of the heart makes the difference between life and death !

Q. How has the growth of the industry impacted the common man?
Role of pumps in life of common man remains in the background, primarily because it is taken for granted, that if a pump has to work, it has to work. Change in lifestyle is often associated with pumps doing some important function, which is taken for granted. For example, if shopping malls have become a significant aspect of change in life-style, shopping malls have to have all the vast space air-conditioned.

The system of air-conditioning cannot work without the pumps working. The common man is blissfully unaware of this, because the basic fact that shopping malls have to have all the vast space air-conditioned, is itself taken for granted and in turn the pumps therein. High-rise sky-scrapers seem to be becoming the order of the day, especially in Mumbai, which is constrained to grow only vertically, since, it has limited space to grow horizontally. High-rise structure inherently means pumping to raise the needed water-supply that much up.