Leveraging Asean Connections To Boost Local Electrical Gear: India’s Strategic Move.
The Indian Electrical Equipment Manufacturing Industry highlighted worries about certain foreign utilities' refusal to recognize CPRI test certificates. In this regard, the Ministry of Power met on February 16, 2023, with Indian Missions/Embassies of the relevant nations. The Missions were apprised of the difficulties of Industry.
Leveraging Asean Connections to Boost Local Electrical Gear: India’s Strategic Move.
Sources claim that the union government is doing everything possible to promote Central Power Research Institute (CPRI) products in international markets, including those in Asean nations, because some foreign electricity utilities do not recognize India’s certification of domestically produced electrical equipment.
This is related to Dhaka Electric Supply Company Limited (DESCO), a Bangladeshi company, rejecting CPRI accreditation in a global proposal it submitted. The energy for the neighbouring capital comes from DESCO. China accounts for more than $500 billion of the $1503.21 billion international market for electronic components.
The approach includes training the heads of India’s embassies in Asean nations about CPRI certification, which adheres to national and global requirements and assurances that a product meets predefined parameters. The Asean Community consists of Southeast Asian countries, including Indonesia, Vietnam, Thailand, the Philippines, Myanmar, Malaysia, Cambodia, Brunei, Laos, and Singapore.
The Indian Electrical Equipment Manufacturing Industry highlighted worries about certain foreign utilities’ refusal to recognize CPRI test certificates. In this regard, the Ministry of Power met on February 16, 2023, with Indian Missions/Embassies of the relevant nations. The Missions were apprised of the difficulties of Industry.
The credentials and accreditations of CPRI were discussed in the meeting, along with a comparison to other international laboratories. It was also revealed that the facilities at CPRI laboratories are on par with those at other international laboratories, according to the union power ministry’s email response to Mint.
Its response stated, “The Indian Missions have notified that they will also be raising the subject with the respective countries to fix the difficulties. Building cross-border energy links is a crucial component of Prime Minister Narendra Modi’s neighbourhood-first strategy, which involves containing China’s expanding influence.
Electricity is a strategically significant sector. India’s energy diplomacy includes everything from putting up liquefied natural gas facilities to supplying petroleum products and engaging in cross-border electricity commerce.
As a result of supply disruptions in China, The G20 summit is scheduled for September 2023 under India’s presidency and is also expected to adopt a landmark declaration to protect supply chain security.
“The strategy entails marketing CPRI in international markets with the possibility of exporting electrical equipment made in India. According to a person familiar with the above-mentioned development who wished to remain anonymous, it also involves CPRI working with large utilities in identified countries.
Given that India is creating specialized “Manufacturing Zones”, which is a part of the Atmanirbhar Bharat package, which is primarily intended to reduce the use of Chinese-made equipment and attract businesses across power generation, distribution, and transmission —both in the conventional and green energy spaces—this development assumes significance.
The Central Power Research Institute (CPRI), a society operating independently under the Union Ministry of Power, received the prestigious accreditation from the National Accreditation Board for Certifying Bodies (NABCB) last year for the certification of electrical equipment in accordance with ISO/IEC 17065 standards.
With this certification, manufacturers who had already received test certificates from CPRI could export their goods without having to have them retested or authenticated by any other authority outside of the country. This has strengthened “Aatmanirbhar Bharat” and given a massive boost to India’s existing strong domestic development and production of electrical goods, according to the union power ministry’s statement.
“As a result of numerous measures, India’s electrical machinery and equipment exports reached a value of about 758 billion Indian rupees in the fiscal year of 2022. From merely 68 billion rupees in the fiscal year 2014, this represented a considerable increase, the union electricity ministry added in response.
Monday morning emails submitted to the Bangladesh High Commission in New Delhi, the CPRI, DESCO, and the Indian Ministry of Foreign Affairs were unresponsive at the time of writing.
India is seeking to establish a regional power grid and market that will include Myanmar, Bhutan, Bangladesh, Nepal, and Sri Lanka, all with an eye on China. India has already announced cross-border electricity trade regulations.
To compete with China’s Belt and Road Initiative, India is also making progress with its ambitious global electrical grid plan. The “One Sun, One World, One Grid” (OSOWOG) global grid plan has been divided into three stages.
The interconnection of the Middle East, South Asia, and South-East Asia (MESASEA) is addressed in the first phase to share renewable energy sources, such as solar, to meet electricity needs, particularly peak demand. The MESASEA grid is connected to African power pools in the second phase, while the third and final phase focuses on global interconnection.
With a predicted CAGR of 8.5 per cent between 2012 and 2022, the global market for electrical equipment is expected to grow from its 2012 level of $1503.21 billion. According to estimates, the size of the Chinese market is between $400 and $500 billion, while India’s market is still more than $50 to $60 billion.
Asia Pacific will account for 45% of the global market for electrical equipment in 2021, followed by Western Europe (22%), according to Rohit Pathak, president of the Indian Electrical and Electronics Manufacturers’ Association (IEEMA), a lobbying organization.
India’s Growing Electrical Equipment Manufacturing Industry
India’s industrial sector, including the industry that produces electrical equipment, has been expanding consistently over the past few years. The Industry is predicted by the Indian Electrical and Electronics Manufacturers’ Association (IEEMA) to develop at a CAGR of 8% between 2020 and 2025, reaching a value of USD 100 billion by 2022.
This growth is being driven by increasing demand from sectors such as power generation, transmission, and distribution and from industries such as railways, automobiles, and telecommunications.
The Indian government has been taking proactive measures to encourage local production of electrical equipment, with initiatives such as the Make in India program and the National Programme on LED-based Home and Street Lighting.
These initiatives have helped to increase the competitiveness of Indian manufacturers, reduce the cost of production, and improve the quality of the products.
India’s ASEAN Missions: Promoting Locally Manufactured Electrical Gear
India’s diplomatic missions in ASEAN countries are playing a key role in promoting the use of locally manufactured electrical gear. The missions are working closely with local governments, trade associations, and industry bodies to create awareness about the benefits of using Indian electrical equipment and to facilitate business partnerships between Indian manufacturers and local companies.
The Indian government also organises trade shows and business delegations to ASEAN countries to showcase Indian electrical equipment and explore business opportunities. These initiatives are expected to help Indian manufacturers to increase their exports to ASEAN countries and to reduce India’s dependence on imports.
Benefits for India and ASEAN Countries
India’s initiative to promote locally manufactured electrical gear in ASEAN countries is expected to have several benefits for both India and the ASEAN region.
For India, this initiative will help increase electrical equipment exports, which is a key component of the country’s exports. This, in turn, will help to reduce the country’s trade deficit and improve its balance of payments.
For ASEAN countries, using locally manufactured electrical equipment from India will help reduce their dependence on imports, improve the quality of the products, and create opportunities for local companies to partner with Indian manufacturers. This will also help to increase trade between India and ASEAN countries and strengthen economic ties between the two regions.
India’s efforts to promote locally manufactured electrical gear in ASEAN countries are a testament to the country’s growing competitiveness in the global electrical equipment manufacturing industry.
With the support of its ASEAN missions, India is well-positioned to increase its exports to ASEAN countries and reduce its dependence on imports. This initiative is expected to benefit both India and the ASEAN region, strengthening economic ties and creating opportunities for growth and development.
Edited by Prakriti Arora