The Rise of Forging Units in India
The engineering industry, in which a specific metal is pressed, squeezed, or hammered under a large amount of pressure into high-strength parts, is known as forging. It plays a pivotal role in the Indian economy. It serves the core sectors of automotive parts and tools, while applications range from the segments of steel, coal, material handling systems, highway equipment, cement, chemical processes, oil exploration and shipbuilding to energy, defense, railways and agricultural machinery. among others. It is one of the main contributors to the manufacturing sector.
In India, the domestic automotive sector and outsourcing have been the main drivers of growth in this industry. A manufacturer of forged machined parts has to deal with a constant increase in production and exports. The destinations of the forging industry are on the rise due to the boom in the automotive components industry, with forging exports expected to exceed the magic figure of USD 7 billion by 2017. This constitutes almost 15% of the world’s exports. Indian auto component exports. In addition to this, there is a wide scope for the adoption of forgings in many other spheres that would open up great business opportunities for this industry.
Based on these trends, the annual growth in demand for forgings in India is expected to be in the range of 16% and hence the future looks promising for machined forgings suppliers in terms of the expected increase in both global and national markets. . Increasing globalization has led to a sharp increase in investments in the sector. This has led to the industry being capital intensive rather than labor intensive.
To expand their markets globally, even small-scale units have increased their capital investments. Small-scale units have upgraded their facilities in terms of technology and quality, and some of them are now OEMs in the automotive sector.
According to the Association of Indian Forging Industry (AIFI), with an installed capacity of around 37.7 lakh MT, this industry in India has the ability to forge a wide variety of raw materials like carbon, alloy steel, stainless steel , super alloy, titanium, aluminum, etc. Depending on the scale of operations, the industry can be categorized as very large, large, medium, small, and very small.
Depending on their installed capacity, very large are those with more than 75,000 MT. The large ones are in the range of 30,000 to 75,000 MT and the medium ones are those with 12,500 to 30,000 MT. Small units are those with 5,000 to 12,500 MT, while those with a limited capacity of up to 5,000 MT belong to the very small category. However, SMEs comprise a significant part of the forging industry, as evidenced by the fact that they make up 87% of the total number of units. Medium units are 8% while very large and large units are only 5%.
As the industry is concentrated in the immediate vicinity of the locations of its end users and customers, the main forging groups are located in the different states of India.