SOUTHEAST ASIA CONSTRUCTION16 Jun 2020
bauma Conexpo India gathers construction machinery sector online

On 23 April 2020, bauma Conexpo India conducted its first exclusive webinar on ‘Dealing with current challenges & determining the way forward for business continuity.’ It focused on the Indian infrastructure sector and the strategies of OEMs under the shadow of the Covid-19 pandemic.

The webinar was organised in association with the show’s official media partner - NBM&CW - and moderated by Rajesh Nath, managing director of VDMA India. The panel consisted of local industry leaders and experts, including: Arvind Garg, chairman of bauma Conexpo India - task force, and also EVP and head of construction and mining machinery at Larsen & Toubro Ltd; Dimitrov Krishnan, managing director of Volvo CE India Pvt Ltd; Deepak Garg, managing director of Sany Heavy Industries India Pvt Ltd; V G Sakthikumar, managing director of Schwing Stetter India Pvt Ltd; and D.K. Vyas, managing director of Srei Equipment Finance Ltd.

The welcome note was delivered by Bhupinder Singh, CEO of bC Expo India Pvt Ltd, raising the pressing issue of the severely impacted economy due to the pandemic, the consequent lockdown, and how the government can revive the economy by accelerating infrastructure projects. Mr Arvind Garg weighed in, “With activities on 70% of National Highways Authority of India (NHAI) projects being restarted, as well as road building activity to be increased to 60 km per day along with various other projects, I believe that the government understands that the best way to boost the economy is by kickstarting infrastructure projects in a big way.”

The future of rental companies

The webinar also covered the important topic of pooling of idle equipment, strengthening rental companies, and flexible financing through non-bank financial companies (NBFCs). It emphasised the need to ensure that such arrangements become a win-win proposition for both buyers and OEMs who are facing a liquidity crunch. The predominant opinion in this matter remained that corporate social responsibility (CSR) activity has proven to become more than just a regulatory requirement and needs to be part of day-to-day business. Mr Vyas pointed out, “It is evident that there will be a shift in customer behaviour and hence, it has become crucial to create an eco-system that starts providing services such as renting. The rental business releases plenty of capital in the system, and going forward the industry needs to capitalise on renting opportunities.” 

MSME and SME sector

The discussion also centred around MSME and SME sectors, and whether the OEMs can support the burgeoning sector. Mr Krishnan expressed his opinion on this matter by stating that, “The biggest challenge the MSME sector faces today is cash flow. It is the need of the hour for the OEMs to have a sympathetic outlook towards this sector, find ways and means to provide them with liquidity support.”

He added, “Communication is critical and as OEMs, we are deeply engaging with the MSME industries in this crucial time.”

Disruption in value chain

The pandemic has resulted in disruptions of the supply chain. The webinar further highlighted how construction and mining equipment manufacturers are handling this disruption.

Mr Sakthikumar emphasised the fact that the viable option, right now, “is to support Indian manufacturers. It will not only support the MSME sector but also prove to be much more economical”. Mr Garg also confirmed that higher levels of localisation can be expected in the near future.

Another point discussed was that the three-month moratorium extended by the Reserve Bank of India (RBI) may impact the participation of NBFCs in the construction equipment sector. Mr Vyas provided insights on this subject, mentioning that he is seeing NBFCs being supported by RBI, which will help maintain funding for the sector.

In addition, the webinar generated insights on the Troubled Asset Relief Program, a modular approach to boost productivity in the infrastructure sector. It then concluded with panellists discussing an effective post-Covid-19 approach to boost employment, productivity, and ROI in the long run. Overall, the webinar roped in over 1,500 delegates and was successful in creating a platform for industry experts to share insights on recent developments.

bauma Conexpo India - held every two years - is regarded as one of the country’s most important industry events for the construction equipment and machinery sector. This year, it is scheduled to take place from 3 to 6 November 2020 in Gurugram, Delhi, covering an exhibition area of 195,000 sq m. The last edition took place in December 2018, attracting 668 exhibitors from 26 countries and 39,173 participants from India and neighbouring states.