Found this expert committee report on power tiller industry/current status/Chinese competition and recommendation to Govt .Anyone interested please go through this reportReport_of_the_Expert_Committee_on_Power_tillers_(Revised) (1) (1) (1).pdf (2.0 MB)
Few important points from above report:
1.86% of farm holdings are small and marginal.
2.Tiller industry remains underdeveloped currently developing 35k-40k units/yr.
3.Two Indian companies VST,BEGALURU and KAMCO ,KERALA caters to 68% of market share.(45% VST, 23% KAMCO).Remaining 30% is power tillers imported from China . Total capacity of Indian manufacture is 90k units/yr. They are unable to utilise full capacity due to Chinese competition.
4.Chinese tillers are 10-20% cheaper than domestic tillers hence the demand for imported tillers is growing. The market share of china tillers has grown significantly from a low of 10% few yrs back to 30% currently.
5.Subsidy was given to all power tillers ,i.e. whether imported or indigenous, provided these tillers are tested by testing institute and meets the minimum performance requirements. Many power tillers importers have not submitted samples for testing but still continue to be eligible for subsidy.
Chinese imported at cost of 65 to 75k, gets subsidy of around 60k but farmers are being charged at 1.25 to 1.5 lakh. ( 2 to 3 times import price.)
5.Many companies(Shrachi and Kranti) import power tillers from China .However they claim as manufacturers and quote their tillers as indigenous.
6.Imported tillers lacks in after sales service and concerns about availability of spare parts.
7.It is difficult to find out the performance difference between indigenous and imported tillers.
8.look at the table to know the price difference between domestic and Chinese players
Recomendations:
1.Domestic tillers must b given preference over imported one
2.Increasing the customs duty up to 25% from current 7.5% on imported tillers.
3. Import quota for power tillers may be fixed as 10% of the total annual market of power tillers in India.
4.Making regulations and internal taxes less onerous to domestic manufacturers to boost make in India .Ways to incentivise the domestic industry through production subsidy/duty exemptions on assemblies and spare parts. Export related incentives for domestic manufacturers. Lower rate of interest(7%) and simplifying norms to extend institutional credit for purchase of tiller. Simplify procedure of subsidy distribution and timely release of subsidy.
5.Indian power tiller manufactures to be cost competitive with china, upgrading quality of tillers, expand dealers network and availability of spare parts.
6.Improve the quality of evaluation/testing of tillers by testing institute. Making more stringent norms for standard testing and for repeat/supplementary testing.
Discl: invested/accumulating.