'Make in India’ for PV Junction Boxes and Cables'

India has witnessed numerous developments to strengthen the manufacturing sector in the recent years. Over the years, several steps were initiated to simplify the ease of doing business and making policies that will spur domestic manufacturing. Government initiative ‘Make in India’ for electrical manufacturing sector has been successful to an extent, but more needs to be accomplished to be completely become ‘Atmanirbhar India’.

The electrical manufacturing industry is broadly categorized into two categories, one is the power generation equipments and the second is the transmission distribution and allied equipments. India has fairly achieved robust growth in manufacturing and technology in both the categories, but we are still importing more value wise than we are exporting. According to IEEMA, India exported INR 41,792 crores (approx. 6.5 USD Billion) worth of electrical equipment whereas its import stood at INR 55,603 crores (approx. US$ 8.6 Billion) in the year 2017-18. This is a great indicator that Indian manufacturers have a huge opportunity that needs to be exploited. One area where we have considerably strengthened our foothold from a domestic manufacturing and technology side is solar PV eco-system, with the government’s focus on developing the solar energy sector and making it the backbone of the power production, the sector has grown leaps and bounds. Domestic manufacturing for this segment is quickly catching up with the requirements of the segment.

In this entire solar power ecosystem, junction boxes play an important role. Out of the many solar PV integrands, the most demanded for and utilized component in the solar industry is Junction Boxes. The total estimation of the demand for junction boxes globally is around 112 million, out of which India is supposed to account for more than 5 million. The worldwide market for PV Junction Box is expected to grow at a CAGR of 7.5% and reach 1430 million USD in 2024. China and India are the biggest manufacturer of junction boxes, with China alone accounting for over 50% of the total production. With technological progress continual innovations, India electrical equipment manufacturers are now coming out with a range of solutions for every need of the sector and steadily gaining more and more market share.

Similarly, if we look at the wire and cable sector in India, the market size is growing at a CAGR of 15 per cent primarily due to growth witnessed in the entire power and infrastructure sectors. The wire and cable market in India alone comprises nearly 40 per cent of the electrical industry. In the recent years, the government schemes like Ujwal Discom Assurance Yojana (UDAY), Deen Dayal Upadhyaya Gram Jyoti Yojana (DDUGJY), Integrated Power Development Scheme (IPDS) and Pradhan Mantri Sahaj Bijli Har Ghar Yojana have given a major boost to the wire and cable market. Further, Initiatives like Smart City, Railway electrification, rural electrification, electric vehicles, etc will have a cascading positive effect and boost the segment in the coming years.

As with the PV junction boxes, the wire and cable segment is also witnessing encouraging signs of innovations by the domestic manufacturers. The ‘Make in India’ initiative in this segment has shown incredible progress with global investors now entering the Indian cable market through technical collaboration with Indian cable manufacturers for production of EHV cables. With these investments and technological tie-ups, the industry is now looking forward to supply cables for solar and wind power applications not just in India, but also at a global level.

As the ‘Make in India’ initiative aims at developing India as a global manufacturing hub by encouraging both multinational as well as domestic companies to manufacture their products for domestic as well as global market, it is therefore important to identify critical segments and sectors where manufacturing can be fully indigenized. As a policy, understanding the critical manufacturing value chain has to be fully taken into consideration from the raw material stage. There a crucial segments where manufacturers are dependent on imports of critical raw material. Therefore a complete assessment of the production value chain becomes important to understanding where we as a nation can achieve complete self-sufficiency. At the same time, it is also important to make great advances technologically so that import substitutions of high-end equipments are manufactured domestically at par with international standards.

- Gautam Seth, Joint Managing Director at HPL Electric & Power Ltd