The most important reason that India cannot rise in manufacturing is the existence of China. For example, there can only be one Wall Street, Hollywood, etc.
China has already sucked out all of the oxygen in the room by being the world's largest manufacturer and exporter. It is impossible to displace China. China ascended and became a superpowerful industrial economic power, because the American government foolishly placed military considerations above economics.
Take machine tools for example. The United States restricted the exports of machine tools to everyone in the non-Western world. The United States did not want non-Western countries to industrialize. This left the machine-tool market wide open for China to fill the space. Hence, China has become the world's largest machine-tool manufacturer and a growing exporter.
Another example is the LED market. China has the financial resources to build billion-dollar plants and the customers to justify it.
Unfortunately for India, it is stuck in a perennial chicken-and-egg problem. India lacks the money to build billion-dollar semiconductor or LED plants, because it lacks customers. Also, since India has no customers for LEDs or semiconductors, India does not have the scientific and engineering expertise to build LED and semiconductor plants.
Finally, India can never compete on price (and quality) against the scale of entrenched Chinese manufacturers in LEDs, semiconductors, electronics, machine tools, large earth-moving construction equipment, ship building, electrical equipment, etc.
Look at this key excerpt: "DMTG, China's largest producer of machine tools, exports products to more than 100 countries." How is India going to get its foot in the door? China already has a commanding presence in more than 100 countries.
I have no idea how India can realistically solve this problem. When you are this far behind the market leader, you're doomed. I am sorry, but 2012 India is not 1992 China.
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Chinese dominance continues in machine tools
China is both the world's largest machine tool manufacturer and consumer. "By value, four out of every ten machine tools produced anywhere in the world last year went into a Chinese factory."
World ranks of machine tool manufacturers:
1. China -- "30% of total world production"
2. Japan
3. Germany
4. Italy
5. South Korea
6. Taiwan
7. Switzerland
8. United States
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2011 World Machine Tool Output & Consumption Survey
THE WORLD SURVEY AT A GLANCE
Machine-tool builders around the world generally started emerging from the recession, as
2010 total output by the 28 principal producing countries
grows to $66.3-billion. That represents a 21% gain from 2009’s $54.7-billion, which had been a drop of one-third from 2008.
Chinese dominance continues. China for years has been the largest consumer of machine tools, and
in 2009 it became number-one producer, as well. For 2010 that leadership continues as the country makes substantial gains in shipments and increases its share to 30% of total world production. With a huge internal appetite, however, China keeps much of its output at home, and its machines are seen little in Western markets.
Japan’s machine-tool-producing industry bounces back smartly after suffering a crippling 2009 decline of 59% (measured in yen). It regains number-two spot among producing countries. The
German sector, which had not been hit as hard the previous year, shows a continuing drop of 5% and comes in third. The
U.S. also suffers an ongoing slump and slips to eighth place, after
Italy, South Korea, Taiwan and Switzerland.
On the consumption side of the equation, China is estimated to have made further gains, via boosts in both imports and domestic production, and thus is far and away the world’s largest consumer of machine tools, installing $27.3-billion. By value, four out of every ten machine tools produced anywhere in the world last year went into a Chinese factory. Germany is next with $5-billion; the U.S. buys $2.7-billion.
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China and Taiwan have caught up with U.S. advanced five-axis machine tools
Advanced high-precision five-axis machine tool fabricating an engine block
"Foreign companies in China and Taiwan have caught up with U.S. technical capabilities, rendering stringent U.S. export controls moot." (see first paragraph in news article)
Let's do the math. From the seventh paragraph, 45 foreign companies produce advanced five-axis machine tools in the BRIC+Taiwan countries. "China has 20 indigenous five-axis machine tool companies; Taiwan has 22." 45 - 20 (in China) - 22 (in Taiwan) = 3 left in Brazil, Russia, and India combined.
For comparison, "there are six American companies dedicated to producing five-axis machine tools." (see fourth paragraph in news article)
U.S. Precision Machine Tool Industry Is No Longer A Global Competetitive Force
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U.S. Precision Machine Tool Industry Is No Longer A Global Competitive Force
March 5, 2010 Volume 17, No. 4
By Richard A. McCormack
richard@manufacturingnews.com
U.S. producers of some of the most technologically advanced machine tools are in trouble, according to an assessment by the Department of Commerce.
Sales of high-precision five-axis machine tools are declining. U.S. share of global exports is in a free fall. Foreign companies in China and Taiwan have caught up with U.S. technical capabilities, rendering stringent U.S. export controls moot. U.S. companies are being purchased by foreign rivals. A lack of training programs has created a shortage of skilled workers able to use the complex machinery. Commercial and U.S. government customers prefer foreign machine tools. Export controls are hampering foreign sales.
The entire U.S. machine tool industry spends only $1 million a year on research on five-axis machine tools.
These are some of the findings from a "Critical Technology Assessment" conducted by the Commerce Department's Bureau of Industry and Security.
U.S. producers of five-axis machine tools had sales of $253 million in 2008, down 11 percent from 2005 sales of $284 million. That was before the U.S. machine tool industry suffered a meltdown in 2009, when domestic consumption tumbled by 60.4 percent, according to the Association of Manufacturing Technology.
Sales of five-axis machines to domestic customers from U.S. producers declined by 19 percent from 2005 to 2008, from $242 million in 2005 to only $195 million in 2008.
There are six American companies dedicated to producing five-axis machine tools, and at least 20 in China. Five-axis tools are used for the production of precision components in the aerospace industry, in making gas and diesel engines, automobile parts, and throughout the medical, textile, oil, glass, heavy industrial equipment and tool industries. "Many other industries are discovering the advantages of these machines," says the Bureau of Industry and Security (BIS).
Yet "only a handful of U.S. producers actually manufacture five-axis machine tools in high volume and most generate less than 10 percent of their annual net finished machine tools sales from five-axis machine tool business lines," according to the market and technology research report from BIS.
U.S. producers of five-axis machine tools exported only $58 million worth of equipment in 2008. In a tally of global exports of all machine tools, the United States -- with exports of $740 million -- accounted for only 4.3 percent of global exports in 2007.
...
BIS also assessed foreign producers of five-axis machines. It found that not one of the 45 companies that are indigenous to Brazil, China, India, Russia and Taiwan use U.S. technology, parts, components or materials. China has 20 indigenous five-axis machine tool companies; Taiwan has 22. None of these companies have to deal with the types of export restrictions facing American firms.
As a result, these companies are able to produce all the machine tools that are in demand in China and Taiwan, plus they are "able to produce in sufficient quantity to export to other LRCs," says BIS.
One of China's five-axis machine tool makers has 24 distinct models. China now has 28 companies capable of building more than 1,000 CNC machine tools. There are 130 Chinese companies with annual capacity of more than 100 machine tools. The country is now supplying most all of its own demand, with only 10 percent of the market being supplied through imports. "In 2005, approximately 59,600 units of CNC machine tools were produced in China," according to the BIS report.
In 2007, the combined amount of CNC metal-cutting and forming tools produced in China was 126,268, more than double the amount produced in 2005. China is now supplying its own demand for five-axis machine tools used throughout its military.
The BIS quotes the Export Compliance Working Group of the American Chamber of Commerce in the People's Republic of China as saying: "Given the existing domestic and joint venture development and the foreign availability of high-level machine tools, U.S. companies could not make a material contribution to China's military development. China's military demands are already satisfied by domestic and foreign supply."
The United States exported 515 five-axis machine tools between 2005-2007, and only 12 of these went to China. DMTG, China's largest producer of machine tools, exports products to more than 100 countries.
...
The report is located at
U. S. Bureau of Industry and Security defenseindustrialbaseprograms/osies/defmarket researchrpts/final_machine_ tool_report.pdf."
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Taiwan remains world's biggest in LED-industry scale
Taiwan Boasts World's Largest LED Capacity in 2011; 27 New LED Fabs Going Up In Asia This Year | SEMI.ORG
2011 LED Capacity by Region (
Source: SEMI Opto/LED Fab Forecast May 2011)
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Taiwan Boasts World's Largest LED Capacity in 2011; 27 New LED Fabs Going Up In Asia This Year
June 8, 2011
Demand for Equipment Rising: Heavyweights Converge on LED Manufacturing Section at SEMICON Taiwan
LED application products -- tablet computers, LED TVs and smartphones -- are all the rage, fueling the rapid rise and proliferation of Taiwan-based LED businesses. Corporations such as AU Optronics (AUO), TSMC and CHIMEI have all crossed over into the LED industry, forging yet another trillion-[New Taiwan] dollar industry in Taiwan.
SEMI Opto/LED Fab Forecast has projected 27 new LED fabs starting operation in the Asia region (excluding Japan) this year. Of these, 17 will be built in China and 7 in Taiwan."
Taiwan remains world's biggest in LED industry scale - CNA ENGLISH NEWS
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Taiwan remains world's biggest in LED-industry scale
by Jeffrey Wu
2011/12/25 14:21:41
Taipei, Dec. 25 (CNA) The output value of Taiwan's LED industry remained the world's biggest in 2011, despite lower-than-expected market growth, according to a local industry association.
As the eurozone's debt problems dragged down demand, the output value of the global LED market grew by only 2.6 percent to US$16.6 billion (NT$502.48 billion) this year from US$16.1 billion in 2010, the Photonics Industry and Technology Development Association (PIDA) said in a recent report.
The PIDA is an organization jointly set up by the government and Taiwan's business and academic circles with the aim of promoting the local photonics industry.
In terms of regional performance,
Taiwan still topped the market with a total output value of US$4.54 billion in 2011 -- including those of the upstream epitaxial wafers -- although the figure declined 0.4 percent from last year's US$4.56 billion, the PIDA said.
South Korea, which has run its LED sector aggressively in the past few years, ranked third behind Taiwan and Japan with output values of US$3.35 billion this year, representing an increase of nearly 5 percent from last year, the association said.
Some South Korean companies have launched low-priced products to tap into the lighting market but they still need to purchase LED components from Taiwan to save costs because of their limited scale of production, the PIDA said.
The association added that LED output value in Europe plunged 7.3 percent from US$1.74 billion in 2010 to US$1.61 in 2011 due to the impact of the European debt crisis and fierce competition.
On the contrary to Europe's decline, China's LED output value surged 26 percent year-on-year from 2010 thanks to local government support, the highest growth among all regions, the PIDA said."