Japanese firm Yanmar forays into farm implements market

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G. Srinivasan

New Delhi, Dec. 15

THE UPA Government sets store by ensuring agriculture growth through a focussed farm strategy entailing policy support and credit infusion on a higher gear. In view of the renewed thrust on agriculture to realise the overall eight per cent GDP growth the Government is envisaging, the focus is shifting to extension services and making available farm implements at competitive cost to farmers.

Against this backdrop, the Japanese diesel engines major Yanmar Co Ltd, Osaka, which is mainly into a range of industrial goods and farm implements from the power tiller and tractor to the combine harvester and to food distribution through containers that keep food fresh during lengthy transportation, is making a foray into the Indian market.

The $5-billion Yanmar Group's Executive Managing Director, Mr Tetsuo Shiga, who is here to inaugurate the company's first representative office, told Business Line that the idea of establishing a representative office was not for short-term gain but for a long term partnership for procurement, manufacturing and sale of Yanmar products in India.

He said the idea was also to find out competitive components for Yanmar products, to build a competitive unit in India in terms of complete products to sell overseas and in the Indian markets and to develop Indian markets with our products.

When his attention was drawn to the extensive use of diesel-driven generators by the Indian farmers irrigating the fields, Mr Shiga said in the past diesel use was limited to stationary engines and trucks.

But, today, farmers all over the world could add to this list shovel loaders for handling soil or manure, pumps, tractors, harvesters, tillers, tree replanters, timber haulers, aquaculture, sewage and bio systems, power generation units, green-mass chippers.

Stating that Yanmar farm machinery was helping to increase productivity, he said: "We think we need some alliance with Indian manufactures to work together to cut down cost."

As far as sale is concerned, he said, two options exist either to go with those who propose to have manufacturing alliance to have marketing as well or we set up our own channel.

"But we have not decided which way we should take and we continue to study the market and eventually decide what is the best option."

He said Yanmar diesel engines were horizontal watercool ones, which have successfully been accepted in China for their "reliability and performance."

He said the company hoped to make a similar success of gensets in India, too, for the benefit of farmers.

Mr Shiga said Yanmar was also looking at the Indian market as one of the major outsourcing hubs for components needed for its manufacturing plants located in Japan, Korea, Indonesia, Italy, Taiwan and other countries as such outsourcing would make the resultant products more competitive in the global market.

He said his company had recently taken a 12 per cent stake ($30 million) in the Mittals-owned International Tractors Ltd, Hoshiarpur (Punjab), the first major Japanese investment in the Indian agricultural industry so far.

Mr Shiga conceded that the purpose of his visit and establishing a representative office in India was to study the emerging market of India thoroughly for farm implements before deciding to zero in on any specific option.

(This article was published in the Business Line print edition dated December 16, 2005)
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