Domestic electrical equipment industry witnessed a negative growth of 4.1 per centin the second quarter of FY13 ended September 30, industry body IEEMA said today.
Indian Electrical and Electronics Manufacturers' Association (IIMA) said the negative growth was mainly due to increased influx of imported equipment.
The industry witnessed a negative growth for the second consecutive quarter in FY13. It witnessed a negative growth of 4.1 per centcompared to the sequential quarter Q1 FY13 which was at 2.1 per cent.
Transformer, power cable, capacitor and switchgear industries, which represent 60 per centweightage in overall industry growth, have witnessed a negative growth for the second consecutive quarter in FY13, the industry body said in a statement.
"We have witnessed the second consecutive negative growth in FY13, and this is an alarming statistic for domestic electrical equipment industry.
"Despite having a strong demand for electrical equipment in India, absence of a level playing field for domestically manufactured equipment vis-à-vis imported products has made it difficult for domestic players to compete with overseas manufacturers, especially from China, who have emerged as a clear threat over the years," IEEMA President J G Kulkarni said.
Imports of electrical equipment have now captured 43 per cent of the market for electrical equipment in the country valued at Rs 1.75 lakh crore in FY12, whereas there is significant domestic overcapacity, he said.
He further said that government needs to provide greater encouragement to indigenous manufacturing in strategic sectors like electrical equipment, as done by several countries, including China.
"Industry needs immediate attention from policy makers to create a framework that offers an opportunity for domestic players to leverage on the anticipated growth in Indian power sector and also capture a greater share of the huge global market for electrical equipment," Kulkarni added.