Foundry industry upbeat on growth prospects post-GST

[vc_row][vc_column][vc_column_text]Most industrial sectors have reported that GST implementation affected their growth in 2017-18. However, the foundry industry has a different opinion, saying GST benefited it.

The Indian Institute of Indian Foundrymen President Amish Panchal said that while the global average was around 4 – 5 per cent, the foundry industry’s growth was slightly higher at around 6 per cent.

He reasoned that some streamlining has happened due to GST. However, the inverted duty structure, and the delay in getting the refund claims by the export units caused problems to the foundry industry. It affected the working capital flow in the foundry sector. Last year, the foundry industry produced 11 million tonnes of castings and the revenues reached a maximum of $19 billion. This figure included casting exports worth $2.7 billion.
The Government of India’s emphasis on “Make in India” has made the foundry industry become more competitive in manufacturing. Thus, the industry foresees greater momentum and hopes for good growth, for the next decade at least. Amish Panchal says that India would have an advantageous position on the export front, with foundry accounting for nearly 40-45 percent of the total exports to the US. He expects the role of the foundry industry to be vital because all engineering and other sectors use metal castings in their manufacturing processes.
Panchal added that the industry is investing on automation and efficient production processes in a big way, thus focusing more on value addition rather than tonnage. Capacity utilisation is in the range of 60 – 70 per cent. There is a good demand for steel and aluminium castings.[/vc_column_text][/vc_column][/vc_row]