International Coatings Scene
INDIA
BY PIYUL MUKHERJEE
INDIA CORRESPONDENT
MUKHERJEE@RODPUB.COM
The dust has settled down
India’s
small scale
paint sector
is poised
for major
growth in
the coming
years.
The Indian Small Scale Paint Association
(ISSPA) recently celebrated its 50th
anniversary at their biennial conference
in Goa. More than 600 participants gathered
for the event.
Delegates mingled and laughed, conversing
with infectious enthusiasm throughout the
event. This positive energy and upbeat mood
was quite a contrast to the quiet, somber
mood I had witnessed at an earlier ISSPA
conference in Agra six years ealier.
So what had caused this obvious change
in peoples’ attitudes?
“It’s quite simple really,” explained Vinod
Joshi, past president of ISSPA who had
presided over the Agra conference six years ago.
“The dust has settled down. Back then most
SSI paint manufacturers were doubtful of their
own survival in the new scheme of things as
part of a rapidly liberalizing India. We were all
fearful of the future and believed we would perish under the crush of globalization. But what
has happened is that along with the growth in
the national economy, everyone has received a
chance to grow their business. We were afraid
we would be outpaced on price, but we have
realized our strengths now as innovators, collaborators with the large paint manufacturers
via complementary products, and as providers
of quality and consistency to our customers.”
ISSPA’s membership figures bear this bullish
trend out. From just over 1,000 members back
at the Agra conference in 2000, ISSPA has
grown to include 1,600 members. During the
intervening years, in spite of the withdrawal of
patronage and a general apathy of the Indian
government, ISSPA members began exporting
their goods—pigments, resins, chemicals and
allied products—and served as outsourcers to
the larger paint manufacturers.
In addition, small sector paint manufacturers
also rallied together and lobbied the government.
In terms of India’s paint turnover, which is
approximately $1.8 billion, this non-organized
segment of manufacturers now represents
nearly 40% of the market. With a value of
approximately $600 million, the small scale
sector is projected to grow to over two billion
dollars over the course of the next two decades.
Within this context, it is little wonder that
various speakers at the conference spoke of
the need to stop thinking small.
Soren Malekar, from Asian Paints discussed his belief that it is time for a paradigm
shift to occur from thinking small scale to
what he called “right scale.”
Ashim Kumar Mukherjee, chief of operations, Jenson & Nicholson India Limited, gave
a dynamic talk in which he exhorted the audience, “You are not small in any way. You have
no idea of your own value.” He went to the
extent of questioning the presence of the word
“small” in the moniker ISSPA itself.
Across the world, 70% of businesses are family-owned. In India, the small scale sector
across various industries, provides a staggering 70% of employment in the country. As one
of the speakers dryly pointed out, “In contrast,
80% of the Non Performing Assets (NPA) of the
banks that lend money is from the ‘organized’
or large company sector.”
Expounding on the theme of the conference,
“Reset the Mindset,” speakers reminded the
participants of the strengths of family-owned
structures including job security. Also, their
ability to make quick decisions without needing to participate in a spate of team-building
exercises and so on is another advantage.
S. C. Srivastava, of K Tech India Limited, a
manufacturer of specialty chemicals and coating additives, said, “This conference is always
extremely interactive simply because for us,
our survival hangs in the balance.”
India is uniquely positioned in today’s global
industrial markets, and not just as an emerging
market with a billion consumers, although that
has had its direct impact also. With the consumerism boom, housing as well as the household ‘white goods’ sector was poised at an inflexion point of growth.
