Alfa Laval to make India export base for Asia Pacific

PRESS TRUST OF INDIA

New Delhi, Aug 8: Swedish engineering giant Alfa Laval plans to make India an export base as part of its strategy to relocate some of its manufacturing facilities outside Europe. "Indian operations, with its excellent engineering skills and competitive manufacturing cost is being turned into a production base for parent's Asia Pacific business," managing director of Alfa Laval (India) Ltd Satish Tandon said. The local subsidiary is also banking on export orders from its parent company as the latter was relocating manufacturing lines from western countries to Asia, Tandon said. However, the Indian subsidiary could face stiff competition from the Swedish parent company's affiliate in neighbouring China, which also has excellent manufacturing base, he said. "We are pumping in Rs 15 crore by mid-2000 to increase our production capacity by 35 per cent for exporting separators and decanters and equipment used in effluent treatment," Tandon said. The parent company has already decided to relocate separators anddecanters assembly lines to India. Already around Rs 3 crore have been invested in the new production line and the entire facility will be ready by mid-2000, he added.Alfa Laval has identified water technology, desalination plants, effluent treatment plants and heat technology development as its core competency areas and would gradually move out from supply of stand-alone components, he said.

In line with the new strategy, Alfa Laval sold its tetrapack processing systems division to Tetra Pak (India) Ltd earlier this year. "For exports, the company has identified Bangladesh, Australia, Japan and Algiers as potential markets from where it can extract revenue from overseas business," Tandon said. "Exports revenue would help to increase our profit margins to 10 per cent of turnover which is the global benchmark in engineering industry," he said. Tandon said Alfa Laval India's current margins at 8 per cent of turnover, were 2 per cent below the international benchmark. "These export initiatives would becarried out in collaboration where marketing and after sales service will be handled by Alfa Laval's local subsidiary in that country while manufacturing and installation of equipment would be our responsibility," he said.

Top

Printer-friendly page