Integrated Machine Tool Parks

Proposal for an IMTP near Bangalore

Presentation to IMTMA member companies5th May 2012

05 May 2012 1IMTP

IMTP-South A proposal

Why an Integrated Machine tool Park?The growth potential for machine tool industry is vast.Production 2012-13 (exp.): Rs.4500 crProjected Production by 2016-17: Rs. 13,000 crThree-fold growth in 5 years

Requires capacity expansion through:•Expansion of existing units•Setting up new units•Simultaneously, expansion of entire supply chain

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IMTP-South A proposal

The South region accounts for 50% of production•Present: Rs. 2500 cr•By 2016-17: est. Rs. 7000 cr, assuming 50% share

This expansion requires:•Land•Infrastructure•Investment

Similar growth potential exists for other machine tool regions in the west and north.

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IMTP-South A proposal

What is the current position?•Many large units are expanding at Dobbaspet •Some have real estate around Hosur for expansion•However, by and large, machine tool companies and ancillaries, SMEs are hampered by non-availability of land.•High cost of land (around Rs.10+ cr/acre) puts it beyond most units to acquire land near Bangalore.•Infrastructure is weak; Regulations on land acquisition and use takes long time for setting up units.

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IMTP-South A proposal

Therefore, any substantial expansion of machine tool units and its supply chain requires a new approach to address these constraints What is the alternative?Other industries in India like IT, Textiles, Auto/Auto-component, Leather, Foundry etc. have adopted the Industrial Park route to expansionTirupur Textile Park has 400+ units, annual turnover Rs 5000+ cr.Machine tool industry must look at this route for its growth and expansion

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IMTP-South An outline

What is an Integrated Machine Tool Park?Next slide shows the concept graphically

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CFC and R&D

Land & utilities Effluent & waste disposal

Machine Tool companiesComponent and

sub-assembly mfg units

FoundryHeat treatmentSheet-metal units

Service providers

Trg, Conf. & Exhibition Centre Housing &

Guest House

Commercial partners

Machine Tool Park: an overview

BOP suppliers

Park admin, management & maintenanceGovt interface

IMTP-South A proposal

IMTMA has worked on some details for the IMTP in the south. Broad parameters are as follows:•Total land area proposed: around 300 acres•Area net of infrastructure area/green area etc.: ~ 210 acres•Area for Estate admin/Trg/Conf/Exhibition/Essential residential/Medical/Hostel/Hotel/CA: 10 acres•Area available for allocation to mfg. units: ~ 200acres

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IMTP-South A proposal

Target occupation: •2-3 machine tool units•10 medium/large ancillaries mfg sub-systems•75 SMEs (from fabrication/components/sub-assemblies)•10 Service units: Heat treatment/Painting/Packing etc.•Other high-tech user-mfg units (die/mold, tooling, aerospace, auto-comp, instrumentation, medical etc.) – for synergy, limited no.•10-15 stockists of raw materials/standard parts/sub-systems•Logistics units (Transport, IMPEX, travel, etc.)•CT, Customs & Excise, regulatory agencies, Bonded Warehouse•Banks and Financial Institutions

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IMTP-South A proposal

Parameters for location:•Land at reasonable price;•After development of infrastructure, affordable cost to users on allotment•Quick access from existing machine tool clusters•KIADB support in acquisition process•Alternative, ready KIADB location without need for fresh acquisition

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LOCATIONHosa NarasapuraPhase II/III12 km from Tumkur75 km (90 min)from Peenya, off NH4

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IMTP-South A proposal

What is the likely requirement? IMTMA ran an informal questionnaire among members to find interest of companies and extent of land required.Response:14 companies have responded with a requirement of 56 acres, 4000Kw. Many others, including foreign machine tool companies have expressed interest. Land possibility?GoK have assured support and is keen to sign an MoU.

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IMTP-South A proposal

•Likely land cost? Estimated at Rs. 60-70 L per acre, fully developed with infrastructure and amenities, ready for construction by manufacturing units. Allow for variation!Next steps:•Sign an MoU with the GoK for the project•Firm up the companies who will be promoters of the IMTP•Get the draft MoA and SPV company structure ready for registration.•Discuss with KIADB/KUM and finalize location•Prepare a Project Proposal and submit to KUM•Prepare a DPR for implementation

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IMTP-South A proposal

Invite IL & FS to make a detailed presentation of the proposed Machine Tool Park

Thank You

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