We See India As A Hub For DuPonts Global Sourcing

Updated: Sep 20 2003, 05:30am hrs
Pankaj H Shah, regional leader India and Pakistan and President DuPont, South Asia, has his hands full. With an overall responsibility for the companys operations in India, Pakistan, Sri Lanka, Bangladesh and Nepal, he is travelling extensively to these countries giving specific attention to new and existing businesses.

In his 20 years with DuPont, he has held senior positions in areas like finance, product management, corporate planning, purchasing and business management. Holding a masters degree in chemical engineering and an MBA, Mr Shah was earlier managing director of DuPont Performance Coatings. In an exclusive interview with Sangeeta Singh of FE he talks about DuPonts new areas of focus and its India plans.

Are you satisfied with the way DuPont is growing in India What are your projections for the next couple of years
Our current sales in the Indian market is $200 million and we are hoping to double it 2005-06. Till last year, Dupont was not maintaining a good growth but this year onwards we expect a 25-30 per cent growth on a year-on-year basis over the next 3-4 years and perhaps more after that. I feel we have crossed the threshold of low growth period.

What are the key areas that would drive this growth
This will mainly come from our businesses of crop protection, seeds, engineering polymers and auto paints. We are also intensifying operations in the areas of research and knowledge management. We have also realised that brick and mortar is not a sustainable model and have decided to get into contract manufacturing.

DuPont is now getting into the area of safety, which ideally is service-based rather than product-based, and the company has big plans for this in India. Is this a de-risking strategy
Moving from products to services. It is not a de-risking strategy. It is a well thought out growth strategy. Firstly, DuPont has almost two centuries of experience in the area of safety and secondly, we consider safety as a product which enhances value and reduces costs.

So, how fast do you expect DuPonts safety business to grow to a sizeable level and what are your projections for that
It is difficult to say because the business is still in the embryonic stage. Also it is difficult to say as what kind of growth we can achieve in this business. But the safety levels of Indian companies are quite low and we see a huge business prospects, especially in the areas of oil and gas. Also, the kind of services that DuPont offers is not available. Our programme, DuPont Safety Resources, has expertise in the areas of ergonomics, contractor safety, asset effectiveness, emergency response and workplace safety.

How do you rate India vis-a-vis other countries in Asia Pacific especially China as far as Duponts overall business strategy is concerned
DuPont is thinking in terms of making India a hub for global sourcing. This will especially be in the area of biotechnology, nano technology and chemicals. For research we are also tying up with research institutions like Council for Scientific and Industrial Research (CSIR) and Indian Institute of Science. In 2-3 years we may also go full steam on our own.

Because of its strong research and IT base India ranks next to China as far as DuPonts focus on Asia-Pacific. We have noticed that India-specific proposals are never turn downed by our headquarter in the US. Our group CEO was in India some months back, which also suggests that it is a priority nation for DuPont.

The Asia Pacific business contributes only 16 per cent to the groups worldwide business. Have you made any projections as to how much it will rise in 3-5 years
We have not made any projections as to how much the region will contribute to the total business but I can certainly say the region is the groups priority and this is where maximum growth is happening. I can also say that growth in the region will be propelled by India and China.

Besides India and China what other countries is DuPont looking at for intensifying operations
We are actively looking at Eastern Europe. There are countries like Poland where we enjoy competitive advantage. The markets in Western Europe are much more mature and the scope of growing further is limited.

But there are countries in East Europe that are undergoing political upheavals and are faced with internal strife. How would you tackle these problems
We dont run away. Rather, we like facing challenges. In the past also DuPont has been in countries and regions which were undergoing problems and we emerged stronger. We have gone in for challenging jobs in different regions. After 9/11 and the anthrax scare the US government asked DuPont to establish safety norms and we did that.