COUNTRIES TO CONNECT South Korea
Generating a New Wave of Investment The Korean machine tools industry is weathering stormy business conditions arising from the Eurozone economic crisis. However, armed with creative innovation, Korean machine builders are geared to overcome the difficult tide with the firm belief that it will provide momentum for a new take-off.
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he machine tools industry in South Korea has regularly upgraded its level of technology, and manufacturers in the country are now competing successfully in the world market in terms of innovative technologies and product range. Korea ranks fifth in production, seventh in export and fifth in import of machine tools.
trend, the market demand for Computer Numeric (CN) machine tools has rapidly increased. While macroeconomic policies strengthen the financial capability of companies engaged in manufacturing, textile, automobile and shipbuilding industries, economic policies have strengthened the financial capabilities in all manufacturing sectors.
Opportunities & Threats Growth Accelerator According to Korean Machine Tools Manufacturers’ Association (KOMMA), the machine tools production in January– June 2012 was about ₩1.81 trillion, up 3.6% year-on-year, while shipments also rose 10.3% to about ₩2.01 trillion. In terms of production by item, the yearon-year growth in orders was realised for NC cutting machines (about ₩1.56 trillion, 7.8%) and general purpose cutting machines (₩71.7 billion, 35.1%). But orders for metal forming machines decreased 28.5% to ₩174.5 billion. The demand in South Korea’s machine tools market has changed from standard, cost-effective products to highprecision machine tools. In line with this 156 MMT - January 2013
Companies such as Samsung, Hyundai, LG and Doosan have not only received a good response in India but have also set up manufacturing base in the country. Indian companies can provide component and raw materials to Korean companies and lately, they have started looking at Korea as a potential business partner. SIMTOS 2012 had a huge number of Indian exhibitors, visitors and buyers looking at business opportunities in the country. Korea seems to be a good business partner; but it can also be a threat for Indian companies, as it produces high-end sophisticated machines to costeffective products.
Why South Korea ?
Healthy trade relationship Huge demand for components Well established market
trade relationship. Many Korean machine tools giants have set up their facilities in India. According to Hee-Chul Park, Director General, KOMMA, “India is the fourth country we export to, after China, US and Germany. In 2011, Korea exported machinery worth US$168 million, with an increment of 39%. We share a good relationship with Indian companies. It is all about synergic growth prospects, as Indian companies have shown interest in Korean products and Korean companies are also willing to invest in India. This will enhance the trade prospects between the two countries.” Going forward, it has been forecasted that Korean machine tools manufacturers will expand their business in India, while India will look for business in machine tools component.
The Indian Connect India and Korea enjoy a very healthy
nishant.kashyap@network18publishing.com