Luigi De Vito,
President,
European Federation of Woodworking Machinery Manufacturers (EUMABOIS)
To all DelhiWood 2023 Stakeholders,
As the new EUMABOIS President, it is my pleasure to welcome you to DelhiWood 2023, a benchmark for the Indian woodworking industry that weaves in principles of innovation and new partnerships. I am delighted to share some thoughts on global economy dynamics, regional perspectives, our industry, and the importance of knowledge culture.
The global economy has encountered numerous challenges in previous years. Global trade, as expected, was not immune to such dynamics and, according to the latest World Bank estimates, it eased up in the second half of 2022, reaching a growth of 4 percentage points along with a downward trend of 1.6% points for the January of the ongoing year. These figures simply mirror the slowdown in global industrial production mainly caused by the demand shift toward its pre-pandemic structure. Current forecasts show that trade will come under additional pressure, especially in emerging and developing economies that have strong trade links with large countries where the demand is expected to fall sharply. On the other hand, global supply, at the forefront of commodities, will remain and even become more disrupted over the year due to the geopolitical relations in place, the price cap on energy, and intensified restrictions imposed in China because of the COVID-19 re-emergence.
In such conditions, South Asia is facing cumulative strong spill over effects due to the weakened growth in its crucial partner countries. India, being a rising star, which accounts for three-fourths of the region’s output and boosts the weighted average of the entire region, referring to the latest indicators, recorded a significant growth in the first half of the fiscal year 2022-23, primarily due to strong private consumption and fixed investment growth. Although average growth, according to the Global Economic Prospects, is projected to record a slight decline from 8.7 (FY 2021-22) to 6.9 (FY 2022-23) percent due to the joint impact of the mentioned multi-layer side effects, increased infrastructure spending and various business facilitation measures launched by the Government could penetrate private investment and consequently support the expansion of manufacturing.
Its added value ratio in the Indian GDP spins in the range between 13% – 15% and keeps maintaining strong performances, needed to pave the way for higher shares that would further strengthen employment policy as one of the most important macroeconomic development indicators. This new approach could be a turning point for India as it strives to become a real high-tech manufacturing hub that would strengthen long-term reputational return, being a vital prerequisite for the future investment climate.
Woodworking industry in India is gaining its momentum. Contemporary prospectives, especially for the furniture sector, are encouraging i.e., by several references the country holds 5th position of the world’s production while the consumption is ranked at 4th position. Guiding cause of such outlook are income increase, urban development and its accompanying lifestyle change that will aggregately drive the demand upward. However, we must bear in mind that considerable part of increased demand is covered from imports. In such state of affairs, machinery companies might be the key players to capture this discrepancy between supply and demand along the entire value chain. The top European exporters of woodworking machinery to India are Italy and Germany holding 2nd and 3rd position of all national imports with a share of 12.95% (USD 16 million) and 10.76% (USD 13 million) respectively (ITA, February 2022 reporting the source of Indian Ministry of Commerce & Industry for 2021).
We can all agree that investments and incentives are certainly important to obtain a full set of benefits and improve economies of scale in the woodworking industry, but of equal importance are the process maturity and managerial structure quality that can be achieved through effective industrial synergies and knowledge transfer mechanisms. Because of that, DelhiWood 2023 should be perceived as the opportunity to capture brand-new technology updates in real-time and take advantage of the two-way communication that lays at the core of the EUMABOIS code of conduct and is the guiding principle among member associations. By supporting this important event through active promotion of its importance and provision of insights on international trends, it is our sincere intention to generate a tangible contribution to unleashing competitive potential of the woodworking sector in India in the light of sustainable and inclusive industrialization.
