“Sterlite issue not a showstopper”

The large-scale manufactures are not immediately affected due to their greater exposure to the import markets and Birla Copper has been able to meet their demand. Shreegopal Kabra, MD and Group President, RR Global

Though the closure of Sterlite’s Tuticorin plant has emerged as a major concern for the enduser industries in the wake of reduced availability of copper, Shreegopal Kabra, Managing Director and Group President of RR Global feels that it will certainly not be a showstopper for overall industry growth. Apart from being a business leader, Mr Kabra is the President of IEEMA and Past Chairman of Winding Wires Manufacturers Association of India (WWMAI). Excerpts from his interview with Subhajit Roy:

What’s your take on the closure of the copper plant at Tuticorin and its cascading effect on electrical equipment industry?

Issues like reduced availability of copper, primarily attributed to closure of the copper plant at Tuticorin, may have some bearing on Indian electrical equipment sector but will certainly not be a “showstopper” for its overall growth. Till now, Indian manufacturers partly depends on imports as far as copper is concerned. However, if copper is made available locally in adequate quantity, it will be good.

So, can we say that there is absolutely no immediate impact of shutting down Tuticorin plant on the Indian industry?

Not that. The large-scale manufactures are not immediately affected due to their greater exposure to the import markets and Birla Copper has been able to meet their demand. However, the small-scale manufacturers who cannot afford to import due to capacity and budget constraints, are certainly hit.

Do you foresee its impact in the longer term?

Yes, of course. Today, the growth of any industry across the globe depends on availability of raw materials locally and certainly India is not an exception. Unless and until Sterlite’s Tuticorin plant restarts or even Birla Copper expands its capacity, the copper-dependent industries will suffer in the long-run. Even if some company wants to open a new copper plant, it will take at least 3 years for commercial production.

Has the shortages in the availability of copper impact on manufacturers’ profitability?

As of now, not much! It will atleast take 6-9 months to be able to come to a cost conclusion. Till then, we need to wait and watch.

Is it somehow deterrent to ‘Make in India’?

Not at all, it will only be a setback for Sterlite. The user-industries will meet their requirement of copper from import or any other domestic resources. However, as a representative of Indian industry, I believe the situation is not ideal. We expect the industry should grow, local players should grow.

The Winding Wires Manufacturers’ Association of India (WWMAI) has urged the government to restart the Sterlite plant. Do you expect any positive resolution soon?

Being an Indian player, we would always seek for an early resolution to such issues as we expect a conducive business environment with a level playing field for all.

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