Aggravation of a problem of superfluous capacities in economy of India.
Aggravation of a problem of superfluous capacities in economy of India.
Currency-financial crisis in Asia has indirectly led to the export
Expansion of the states captured by it that has created the defined
Problems for such developing countries, as India. It
The industry even prior to the beginning of this crisis tested the chronic
Difficulties in connection with presence of superfluous capacities. In the present
Time the offer the Indian companies, for example, steels or
Cement essentially exceeds demand for them, despite
Rather fast economic growth observed in these
To the country in 90th years. Results ended on March, 31st
Fiscal year testify to low profitability
Many enterprises of the base industry even at record-breaking high
Break-even sales level. The low price level on them affects, in particular,
Production. In 1992 - 1996 in conditions liberalizatsionnyh reforms
Many companies by means of external loans and wide
Sales of actions have mobilised large means, which subsequently
Have been directed on expansion of a fixed capital. Now
New capacities are started up in operation that allows sharply
To increase output. In the cement industry
The industrial potential for last three years has grown from 65 million
t to 95 million Demand for cement increased dynamically enough
(On 9 % a year), however not in such degree in what were increased
Capacities. The enterprises based till 1991 owing to dearness
Production are superseded from home market by more modern, that
It is partly connected with a considerable rise in prices (the supervised
The state) on the electric power, coal, other raw materials.
In the created conditions process of amalgamation of business has amplified,
However in itself it does not conduct to a conclusion from operation
Not used production assets. According to an estimation "Caspian
Securities ", superfluous capacities on manufacture gorjachekatanogo
Steel hire make 26 % of all capacities, thin
Aluminium sheet - 39 %, a polyester fibre - over 30 %. The Same
The company marks large problems of similar character at
Manufacturers cargo and cars, owners
Hotels. As shows the forecast, in the come financial year
The specified problem will be saved.
Owing to currency-financial crisis in Asia will especially suffer
Producers of cement, steel, aluminium, mineral oil, cars
Industrial purpose and the equipment. On the majority of these
The goods import is insignificant, however negative influence will render
The price factor, as dependence between the prices internal and
Foreign market in 90th years has sharply increased.
As writes "Financial Times", for the first time in port of Calcutta have appeared
Sea vessels with cement from Indonesia. At the same time the cement
The industry is concerning protected. In cost
Import production the share of transport expenses, that is high
Weakens its competitive positions; a port economy of India not
It is adapted for reception of a considerable quantity of cement, are complicated
distribjutorskie operations as its sale is carried out in
India basically small wholesale (actually individual bags).
Company management "Gujurat Ambuja Cements" (makes the cheap
Cement at the enterprises in the western part of the country) considers, that
Crisis in Asia "does not change position".
Threat for manufacturers of a steel is represented to more real and
Hire (in particular, from the South Korean company "Pohang
Iron and Steel "). Two largest steelmaking companies -
State "Steel Authority of India" and private "Tata Iron
and Steel ", most likely, cannot receive the profitable
Export contracts and rather significant industrial orders in
The India. Both producers have razdutye states and become outdated
Capacities. Small manufacturers, in particular "Essar" are vulnerable also
And "Jindal".
Delivery of aluminium hire from abroad is connected with the smaller
Difficulties, than, for example, cement. Therefore, apparently, should
To amplify a competition from foreign suppliers. However
Production of such aluminium companies, as "National Aluminium" u
"Hindustan Aluminium" differs the low cost price and
Maintains a competition on a foreign market. Therefore they, possibly,
Can sustain falling of the prices for this metal.
Reduction in price of mineral oil will mention first of all "Reliance
Industries and Indian Petrп?chemicals ". Large NPZ, letting out
Wide assortment of the finished goods corresponding to the world
To standards, have a more potential for a survival, than
Small producers. Besides, at reduction in price, for example,
ligroina cost of initial raw materials that will weaken will decrease also
Negative consequences for NPZ.
Less favorable prospects expect manufacturers of means
Manufactures. Cheap export from the countries East and Southeast
Asia to some extent positively influences the Indian
The industry. In particular, "Reliance" has received from Republic
Korea the offer on deliveries of cheap steel hire for
The new enterprises. But investment activity in India in
Present time it is weakened, therefore manufacturers of means
Manufactures will feel crisis consequences basically on
To other direction, namely through a problem aggravation
Superfluous capacities.
The companies with high potential ("Gujurat Ambuja", "Hindalco",
"Reliance", etc.), apparently, will strengthen the market positions.
However under the influence of the specified events many observers in general
Call into question correctness of orientation to development of the heavy
The industries in India. Such lack, as almost is marked also
Full absence of widely recognised trade marks. Those
Have only small group of firms, in particular "Marico"
(Vegetable oil) or "Nirma" (washing-up liquids). Others
The companies, for example "Birla" or "Gujurat Ambuja Cements",
Aspire to "untwist" the trade marks. However the stamps having
The greatest reputation, belong basically to multinational corporation branches
(For example, "Hindustan Lever", entering into group "Unilever").
Investors already define the companies which become leaders
Leading branches of the Indian economy in a new century. In this list
The heavy industry and will be to a lesser degree presented in
bolshej - manufacturers of consumer goods, pharmaceutical
Production, developers of a software for the COMPUTER.
The last have formed skeleton of branch which has managed from the beginning 1997
To treble the operational capital. At such exporter program
Maintenance, as "Infosys", it already more than at the leader
The cement company of the country "Associated Cement".
//* an information Source: BIKI, 4.06.98
//* Reg. Nom. - 1080600215.11-------------------------------------------
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