Switching on the growth

Rising demand in the power capacity addition is making switchgear highly demanded
India is the world’s sixth largest energy consumer, accounting for 3.4 per cent of global energy consumption. It doesn’t require any high IQ to understand the high demand of switchgear. Since the Indian government has allowed 100 per cent FDI in the electrical equipment industry, switchgear market has switched on for a better future.
“The Indian switchgear market can be segregated into three categories on the basis of voltage: low-voltage switchgears, medium-voltage switchgears and high-voltage switchgears,” shares Sandeep Selot, Director, Marketing and Strategy – Energy Business, Schneider Electric India.
He continues, “The market contribution of low-voltage switchgears has displayed a remarkable traction, surging from 31.7 per cent in FY 08 to 55.3 per cent in FY 13. This progressive increase in the market share of low-voltage switchgears has been largely attributed to increased urbanisation, construction of new residential households and commercial areas taking place in the country, coupled with the growing concerns for safety and security with respect to the electric equipment. In fact, the low-voltage switchgears represent more than 55 per cent of the aggregate market share, and the share is expected to expand in the impending years.”
Key market trendsThe switchgear industry, which is currently valued at Rs. 135 crore (FY 13), has witnessed a sluggish growth in the past 3 years due to overall adverse macro-economic environment. AV Jagdish, Vice President, Havells India Ltd., says that the industry is going to be stronger due to the growing consumption of electricity, rising urbanisation and infrastructural developments. “With the stable central government, which looks determined to reinvigorate growth, attract large dosage of investments across industries and revive sentiment, the switchgear market is geared up for revival,” he adds.
Even Rajesh Nandwani, Business Head – Switchgear, Anchor Electricals Pvt. Ltd., echoes the same. He elaborates, “The per capita total energy consumption in India was 917.2 KWh by March 2013, which is expected to grow to 1,200 KWh by 2016. With the rapid increase in urbanisation, new residential and commercial complexes, and an increase in infrastructure, there is a high demand for electrical switchgears.”The low-voltage switchgear market size in India is about Rs. 11,000 crore. The domestic switchgear market is about Rs. 2,200 crore. While talking about low-voltage (LV) and medium-voltage (MV) switchgear markets in India, Selot says, “The government as well as the power ministry are planning extensive power enhancement and improvement of electrical grid networks to support growth. The need to have a safe, reliable and efficient power distribution setup at both micro and macro levels is providing growth opportunities to the low-voltage (LV) and medium-voltage (MV) switchgear markets in India.”
While shining light on the double-digit growth of MCB market, Nandwani shares, “The increased awareness in the masses about importance of protection from electrical faults for safeguarding their lives, and property has contributed to double-digit growth in MCB market for the past few years.”
Biswaroop Ukil, Vice President – Direct Sales (India), Crompton Greaves, sounds little cautious yet optimistic. “With the change of guard at the centre,” he explains “it is expected that the sector will see the next wave of investment which in turn will drive demand. Policy consistency will boost investor confidence. Proposed bail-out packages for power projects hit by funding and clearance hurdles will revive the sector. This will include implementation of easier funding rules and improvement in the distribution architecture.
Ukil also says that focus on “Green and Clean Energy” will add to the momentum and “Make in India” drive will help bring new technologies and enable domestic industry to enhance skill levels.

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