Manufacturing India: MNCs

MNCs entered colonial India some even in late nineteenth century as traders. After independence, many got out, but some continued and set up its manufacturing plants in India. Scores of new ones have come in.

For example,in 1888 Lever Brothers introduced Sunlight soap in India. It happened just four years after Sunlight was launched in England. Today Hindustan Unilever Ltd. is a Rs. 26,000-crore company. It today produces for domestic consumption as well as for export. Its innovation of Pureit, the low cost and effective portable water filtration system can be revolutionary for preventing waterborne deceases.

In 1867, Siemens set up the first direct telegraph line connecting Calcutta and London and thereby it laid foundation of Siemens AG’s association with India.

Siemens is now one of the biggest engineering companies in India with annual revenue close to Rs 13,000 crore. Siemens started its first manufacturing in 1955, medical equipment in 1959,electric motors in 1966 and electronic equipment in 1987. Today, Siemens employ 20,000 persons in 23 factories in India competing with other European engineering company such as ABB and Schneider that entered the Indian market and also with Indian engineering companies such as Crompton Greaves and Thermax. Siemens has set up a corporate technology centre in India and earns about 15 percent of its revenues from overseas business.

Genera Electric still remains one of the world’s top engineering company with huge manufacturing in US. It has a long history of association with India. In 1902, GE built the power station at the Shivanasamudra Falls for supplying electricity to Kolar Gold Mines. GE supplies nuclear power plants, jet engines and locomotives to Indian Railways and employs around around 14,500 people with its India revenue of about 2.8 billion US Dollars, but it doesn’t manufacture any of its high tech products for which it is known in India. GE got known for its low cost health care equipment innovated and manufactured in India, and its GE Technology Centre. GE also pioneered the BPO sector in India.

Can one day GE India set up its own manufacturing facilities for locomotive engines or gas turbines in India and export to other Asian countries. Interestingly, GE has set up a wind turbine factory in Pune.

Philips Electronics was known for its radio sets and transistors in 50s and 60s. In 1995, Philips was number 3 TV maker in India. Today, it figures nowhere in competition to Samsung and LG in present digital era. However, Philips remains market leader in lighting and compete well with local brands such as Surya, Bajaj and Sylvania Laxman. Philips started making healthcare related imaging products that helped Philips to sustain its profitability.

SKF, the Swedish bearing set up its first bearings manufacturing plant to meet the needs of automotive sector in Pune in 1965.In 1989, SKF started its second plant in Bangalore in 1989.In 2008, SKF set up a Rs 250- crore customised-bearings plant in Ahmedabad. In 2009, SKF set up a global technical centre in Bangalore too.Eighty percent of its resources are now devoted to providing solutions to the global parent and the rest for domestic solutions. SKF employs today around 3,000 people and commands an almost 50 percent share in the automobile aftermarket. The presence of the manufacturing plants for companies such as SKF and TIMKEN in India is good enough indicator of the manufacturing strength of India.

Alfa Laval, the Swedish firm, entered India in 1937 and last year it completed 75 years. Alfa Laval India is one of the largest supplier of technical processing products in the biotech, brewery, distillery, food, pharma, comfort climate, energy and refrigeration, refinery, petrochemicals and wastewater applications. The company’s offer includes everything from equipment to complete solutions, which are often tailor-made to meet the specific process requirements of the Indian customer. The company has its manufacturing facilities at Pune, Satara and Sarole in India.

Finnish Nokia is well-known for its cell phones. Even though India was one of the largest market for cell phones, cell phone manufacturers were hesitant to set up a manufacturing plant in India. However, Nokia that has a number of manufacturing plants around the globe set up one of its largest factories in Chennai in India to manufacture cell phones. Nokia has recently launched the latest offering in its Asha series, in the presence of company’s global chief executive officer (CEO) Stephen Elop in New Delhi in an attempt to stay in the fierce smartphone race.

The government must discuss with all the foreign companies having manufacturing establishments in India to explore the potentials for exporting as much as possible to take care of the country’s fiscal deficit.

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