LONDON--(BUSINESS WIRE)--Technavio analysts forecast the electric wire and cable market in India to grow at a CAGR of close to 16% during the forecast period, according to their latest report.
The research study covers the present scenario and growth prospects of the electric wire and cable market in India for 2016-2020. The report also lists the power, transportation (railways), and construction sectors as the major end-users of the electric wire and cable market in India.
According to Anju Ajaykumar, a lead analyst at Technavio for engineering tools research, “The major demand for electric wire and cable in India is likely to come from the railway and construction sectors due to rising government investment. The Government of India has allocated a budget of approximately 18 billion for the development of Indian Railways during 2016-2017 and the government also plans to develop 100 smart cities during the forecast period.
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Technavio heavy industry analysts highlight the following four factors that are contributing to the growth of the electric wire and cable market in India:
- Growth in renewable power generation in India
- Expansion and revamping of T&D infrastructure in India
- Increase in investment in metro railways
- Rise in demand for automotive components
Growth in renewable power generation in India
A huge emphasis is given to the commercialization of renewable energy, which will create an enormous demand for electric wire and cables. This is because most of these renewable energy resources are set up in places where proper transmission and distribution (T&D) infrastructure is not available.
Expansion of existing networks to integrate regional grids and form a nationwide electric grid network is being initiated. This will allow a seamless flow of electricity. All this calls for extensive T&D infrastructure development activities, which augurs well for the electric wire and cable market in India.
Expansion and revamping of T&D infrastructure in India
Power cables, a critical segment of the power sector, are experiencing an escalating demand owing to the growth in power generation infrastructure. India is one of the biggest consumers of electric energy after the US and China. With rapid industrial development and urbanization in the country, Technavio expects significant demand for electricity within the country. However, the overall generation capacity is unable to cater to the existing demand. Moreover, the T&D infrastructure is quite old and needs extensive renovation. Rural electrification is another major factor, which is expected to propel the growth of the electric wire and cable market in India. GOI's goal to provide electricity to every home by 2020 should attract major investments in the sector.
Increase in investment in metro railways
Accelerated urbanization and growing concern over pollution have increased the investment toward metro rails for urban mass transportation. The country is predicted to develop metro rails in at least 50 cities across India. Such development where each project requires more than USD 150 million is likely to attract many Indian and foreign companies to take advantage of the huge growth opportunities. “The rise in investment toward metro rail projects is expected to propel the growth of the electric wire and cable market in India,” says Anju.
Rise in demand for automotive components
The growth in the automobile industry in India is predicted to propel the demand for automotive components market in India. Currently India is the sixth-largest manufacturer of automotive components and the market is predicted to account for more than USD 38 billion in 2015-2016. Favorable trade policies with no restrictions on imports and exports make India a popular destination for automotive components. Therefore, the growth in the automobile components market in India is predicted to propel the demand for electric wire and cable market in India, especially cable harnesses.
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