Friday, June 24, 2005

Lack of infrastructure, a worry for all sectors, finds CII

Lack of infrastructure, a worry for all sectors, finds CII

The Hindu

Survey of southern States points to concern over Bangalore

BANGALORE: The Confederation of Indian Industry (CII), which recently carried out a business outlook survey of southern States, has some interesting findings in regard to the scenario in Karnataka. A common concern of all industry sectors is the lack of infrastructure, especially in Bangalore.

The top five industry sectors surveyed in the State are automotive and auto components, information technology (IT), electronics, engineering and steel.

The automotive and auto components sector recorded a sales growth of 17 per cent in 2004-05 and hopes for a 22 per cent growth in 2005-06. However, rising steel and aluminium prices could reduce margins.

In contrast, the electronics industry had only volume growth last fiscal but hopes to post value and volume growth in 2005-06. The constraints to growth, according to industry sources, include poor connectivity to overseas markets, inadequate ports and unreliable power supply.

IT industry

The IT industry posted a revenue growth of 25 per cent in 2005-05 owing to higher billings, and the margins have also looked up. The industry is feeling encouraged by an impressive order book position this year. The major concerns of the industry include the overburdened infrastructure in Bangalore and high attrition rates.

Engineering sector

The engineering industry posted higher sales and profit margins with better operational efficiency.

The sector ended last fiscal with an impressive order book position and expects to carry forward the momentum. Lack of infrastructure and dumping by Chinese producers are its major concerns.

The steel industry performed well both in terms of volume and value.

The upcoming infrastructure projects in the State hold out hopes of better performance in 2005-06 by the sector.


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