Market place

General Economic Situation
The Indian economic situation ran out of steam in
2008 as a result of the economic and financial crisis,
although India is traditionally strongly focussed on
the domestic market and the economic development
consequently depends primarily on the domestic situation.
Therefore, the financial crisis generally had
less effect on India than on nations with a stronger
export focus.

In order to give the stagnating economic growth new
impetus, three economic stimulus packages have
been created since December 2008. In particular,
funding is being injected into infrastructure projects.
Now, a recovery is being anticipated again for 2010;
the prognoses were revised upwards in September
and October 2009. The economic activity is increasing
again and the confidence of companies and
consumers is rising. For 2010, a GDP increase of 6.4
percent is expected, after 5.4 percent in the previous
year. In addition, a real percentage increase of 7.4
percent is being forecast in the industrial sector, including
the building sector.

Wire Industry
The wire industry in India is heavily dependent on
the automotive, telecommunication and construction
industries as the main customers. The rapid growth
of these industries in the last few years has led to
an annual growth of approximately 25 percent in the
wire and cable industry. As a result of the financial
crisis, this growth has temporarily stalled. As a result,
the forecasts for the wire industry are dependent
on how these industries continue to develop.
In 2008/2009, the wire production declined in most
sectors but is now looking forward to a recovery.

Building Sector
The building sector in India has restabilised after a
six-month period of weakness. In the current fiveyear
plan (2007-2012), it is expected to grow by an
average of 10% per annum. Lately, the industry has
recorded a growth of 7 percent. The public sector
deals with about two thirds of investments. As the
Indian government is focussing primarily on publicprivate
partnerships with major infrastructure projects,
the ratio will switch in favour of the private
sector.

With an investment need of about 450 billion US$
until 2012, the infrastructure construction is the
growth engine of the construction industry; the development
of the transport network, in particular, is
an absolute priority of the government.
The demand for office space is currently stagnating,
but should pick up from 2010. In terms of private
residential construction, companies are increasingly
focussing on the low-price market segment; Indian
urban areas, alone, are currently short of about 25
million apartments.

Automobile Industry
While the sales figures in the automobile industry
in 2008/2009 were characterised by uncertainties
about the effects on the financial crisis, the Indian
automobile industry has been slowing recovering. In
total, the annual sales of cars has doubled in the
last 5 years. According to the association of Indian
automobile manufacturers, the growth will double or
even triple by 2015. The government published an
Automotive Mission Plan in 2006, where the objective
is to double the automobile industry’s contribution
to the GDP by 2016 and to create 25 million new
workplaces in the industry.