Pune: Construction and earth-moving equipment maker JC Bamford Excavators, which opened a factory in Pune last September to make components, will now produce a new line of heavy machinery from its global portfolio.
The new range will be manufactured in another plant, coming up next to the existing one, in an effort to tap the booming infrastructure business in India.
In addition, the company will expand its existing range of products that target large infrastructure projects, and look to export to Nepal, Bhutan and Sri Lanka from India.
“As the plant starts producing more, we will look at expanding our reach,” said Mathew Taylor, JCB chief operating officer. He was responding to an emailed questionnaire from Mint.
JCB’s decision to use India as a base for exports to neighbouring countries is a boost for Indian manufacturing as it signals that products can be made in the country at a cost that makes them competitive in the export market.
JCB already has a plant in Haryana’s Ballabgarh, dating back to the time when the company had a joint venture with Delhi-based Escorts Ltd. It proposes to move the manufacturing of all heavy equipment to Pune, and use the Haryana plant for light equipment.
The company, which ended 2006 with sales of Rs2,000 crore, has also announced its interest in tapping India’s mining and agriculture sectors, both of which are seeing frenetic activity.
JCB has a 60% share of the earth-moving equipment market in the country but faces competition in this and other sectors from companies such as Larsen & Toubro, Tata Hitachi, Caterpillar, Tata Komatsu and a public sector firm, Bharat Earth Movers.
According to persons familiar with the development, who did not wish to be identified, Korean construction-equipment maker Hyundai Heavy Industries is close to finalizing and announcing its investment in a manufacturing facility in India.
A booming economy has set off a bout of investment and construction activity in the country’s infrastructure sector.
Recently, finance minister P. Chidambaram said investment worth $320 billion (Rs14 lakh crore) was required over the next five years to upgrade and create infrastructure that could keep pace with the growing needs of the economy.
JCB India’s application for additional land for expansion, adjacent to its existing facility in Pune, is pending with the state government due to unavailability of land in the region, sources close to the development told Mint.
“It has always been our intention to expand our current manufacturing capacity at Pune but at present we have no detailed plan,” Taylor said in response to a specific query.