56th AGM of the Indian Paint Association

Excerpt: THE 56th Annual General Meeting of Indian Paint Association (IPA) was held on 7th June 2019 at Kolkata. Mr Dipankar Chakrabarti, Executive Director – Technology Optimization Lead

THE 56th Annual General Meeting of Indian Paint Association (IPA) was held on 7th June 2019 at Kolkata. Mr Dipankar Chakrabarti, Executive Director – Technology Optimization Lead, PwC Commander Manoj Kr Gupta (Retd), Deputy General Manager, Ship Building, GRSE Ltd Mr Jagdish Acharya, Chief Executive Officer, Paints and Coatings Skill Council, were the guest dignitaries on the occasion. The meeting started with the traditional lighting of the ceremonial lamp.

Welcoming the delegates and guests, Mr Abhijit Roy, President, the Indian Paint Association said:

“India has emerged as the fastest growing major economy in the world and is expected to be one of the top three economic powers of the world over the next 10-15 years, backed by its strong democracy and partnerships. India's GDP is estimated to have increased 7.2 per cent in 2017-18 and 7 per cent in 2018-19. India has retained its position as the third largest startup base in the world with over 4,750 technology start­ ups. India's labour force is expected to touch 160-170 million by 2020,based on rate of population growth, increased labour force participation, and higher education enrolment, among other factors. “India's economy is gaining momentum, thanks to the implementation of several recent noteworthy policies such as the enactment of the long-awaited goods and services tax, and the country opening more towards foreign investors. Therefore, I expect economic growth to pick up to about 7.3 percent for fiscal year 2019-20.

“To sustain and build on these policies and to harness the demographic dividend associated with a growing working-age population (which constitutes about two-thirds of the total population), India needs to reinvigorate reform efforts to keep the growth and jobs engine running. This is critical in a country where per capita income is about $2,000 U.S. dollars, still well below that of other large emerging economies.

“Let me emphasize on the fact that numerous foreign companies are setting up their facilities in India on account of various government initiatives like Make in India and Digital India. The Make in India initiative was conceptualized with an aim to boost the manufacturing sector of Indian economy, to increase the purchasing power of an average Indian consumer, which would further boost demand, and hence spur development, in addition to benefiting investors. The Government of India, under the Make in India initiative, is trying to give boost to the contribution made by the manufacturing sector and aims to take it up to 25 per cent of the GDP from the current 17 per cent. Besides, the Government has also come up with Digital India initiative, which focuses on three core components: creation of digital infrastructure, delivering services digitally and to increase the digital literacy.

“India's gross domestic product (GDP) is expected to reach US$ 6 trillion by FY27 and achieve middle income status on the back of digitization, globalization, favorable demographics, and reforms. India's revenue receipts are estimated to touch US$ 400 billion by 2019,owing to Government of India's measures to strengthen infrastructure and reforms like demonetization and Goods and Services Tax (GST).

“While higher government investments have helped retain a somewhat healthy sentiment for capital formation, the stretch in government expenses has already become evident in the expansion of net fiscal deficit.

“The Indian Paint Industry had been adversely affected during the months of June and July 2017 due to reduction in off take by the dealers because of uncertainties and lack of familiarity in GST implementation. More importantly the rate of GST levied on Paints, i.e. 28%, had also put the industry in a challenging situation. We are thankful to the Government of India for reducing the GST rate from 28% to 18% from 1st July last year on paints and coatings which has given a boost to the Industry. The IPA has been very instrumental in communication with the Government through multiple representations in this regard.

“From the last quarter of the FY 2017-18 the overall prices of raw material of the paint industry were reported to have gone up. The pollution restrictions in China was one of the major reasons for price hike, as the manufacturers in China were going through a challenging phase in meeting the compliances drawn up by the Chinese Government. China being one of the major suppliers of raw materials was facing challenges to meet the global demand. During this phase the demand for paints was reported to be stable. The overall sales growth was close to double digit. Consumption increased for both decorative and industrial paints. Comparatively the demand for water-based paint was better. The per capita paint consumption in the country has increased from 2.57 kg in 2011-12 to 3.34 kg in 2014-15 which is way below the per capita consumption recorded in some of the developed and developing countries, providing immense opportunities for growth for the paint industry.

“The real estate sector is the largest employer after agriculture. This sector is expected to touch USD 180 billion by 2020. Commercial, retail and hospitality real estate are growing significantly. The housing sector is likely to contribute around 11 percent to the Indian GDP by 2020. Government policies towards housing for all have given a huge boost to this sector. New housing launches in the top 7 cities of India increased approximately at the rate of 27 percent on year on year basis during January to March 2019. Similarly, the demand for commercial and office space has gone up by approximately 23 percent on a year-on-year basis during the same period. Therefore, it is expected that the housing sector would generate enough opportunities for the growth of the decorative paint business.

“The growth of the industrial paints segment is dependent on the automotive industry, as 45 percent of the industrial paints are consumed by this sector. Production trend in the automotive industry has grown in 2017-18 and first half of 18-19 but has been slowing down from November 2018 onwards. Protective Coatings on the other hand continued to grow well in 2018-19 and is likely to do well this year as well on the back of the likely increase of infra spend by the new Government at the centre.

“With a median age of 27 years and 45% of the population below 25 years, India has a youthful population and offers great potential for growth of the economy, if harnessed effectively. Offering employment is a challenge with such vast numbers entering the employment market every year. Skill development is therefore rightly diagnosed as a crucial activity to ensure that this vast resource is harnessed effectively.

“With key economic policies on track, the government is likely to focus on faster policy implementation in the year ahead, with a greater focus on infrastructure development. That being said, I believe that a key step toward healthy economic growth lies in reviving private sector investment, given that these have remained at low levels over the past several quarters.

“Paints and Coatings Skill Council (PCSC) has, based on consultation with all stake holders in the industry, arrived at 20 Job Roles (Qualification Packs) for Skill Training. Accordingly, curriculum and content for these 20 Job Roles have been developed to facilitate Short Term Training. Along with Short Term Training, PCSC is also certifying skills acquired through experience under the Recognition of Prior Learning programme. This initiative is to recognise and certify skills under the 20 Job Roles identified. PCSC is creating awareness among youth on the career possibilities in the Paint Industry and offers them the requisite training to pursue careers in the industry. This will lead to narrowing of the skill gaps the paint industry is facing and in the overall improvement in productivity.

“The Association over the last several years had continued to engage with the Ministry of Environment, Forest and Climate Change and Central Pollution Control Board, Department of Industrial Policy & Promotion (DIPP), GST Council, Ministry of Commerce & Industry, Ministry of Finance, Ministry of Chemicals and Petrochemicals, Central Insecticide Board and Ministry of Agriculture and other stakeholders to mitigate the issues faced by the paint industry.

“The IPA Northern Regional Committee organized the 29th Indian Paint Conference during 11-13 January 2019 at Jaypee Palace Hotel & Convention Centre in Agra. Mr Pramod Kumar Khanna, Director, Punjab Paint, Colour and Varnish Works Pvt Ltd led the initiative as the Convenor of the conference. Almost 580 delegates from across the country attended the Conference. The Conference itself was a mark of excellence. The deliberations made by experts drawn from diverse disciplines were highly appreciated. The evening of the conference was well crafted with Cultural programmes. The programme committee organized a special visit to Mathura. The most encouraging part of the conference was conferring Lifetime Achievement Awards. Two of the stalwarts of the Paint Fraternity, Mr N K Bhatia and Mr G N Tewari were conferred with the most prestigious "The IPA Lifetime Achievement Award". Their immense contribution to the Industry was highly appreciated by the IPA Leadership and the entire paint fraternity. I congratulate the Convenor Mr Khanna and Ms Aparna Khanna for making this Conference a grand success.

“I am also very happy to inform you that the IPA Eastern Regional Council met two of the major education group based out of Kolkata, St Xavier's and JIS Group to start a course on paint. We are working on both the options and will finalize the venture with any one among the two prospects very soon. I would like to thank the Regional Committees of the Association, who had organized various programmes during the year and have taken forward the activities of the IPA effectively. It clearly reflects the positive intent and the drive required for achieving success.”

Later Mr Dipankar Chakrabarti, Executive Director – Technology Optimization Lead, PwC gave a presentation on Megatrends, Innovation and Emerging Technology. He spoke about Industry 4.0 and Iot. He spoke about the benefits that can be harnessed through the implementation of Industry 4.0 in terms of productivity and environmental compliance. He gave an overview of the current trends happening in respect to Industry 4.0 both the global perspective and the Indian Scenario and what is the scope. He also revealed

Commander Manoj Kr Gupta (Retd), Deputy General Manager, Ship Building, GRSE Ltd., giving a special talk elaoborated on how the paint industry could be more aligned with the ship building industry in general and Garden Reach Shipbuilders and Engineers in particular as they are the major consumers of industrial paints. He said many of the paints used could be indigenized and also they could focus on new product development for the ship building industry. He explained about the procedures for registering as vendors with GRSE

Mr Jagdish Acharya, Chief Executive Officer, Paints and Coatings Skill Council later presented a report on activities of Paints and Coatings Skill Council. He requested the members to take up joint initiatives with PPSCs in skilling people as there is a huge number of labour which comes from this part of the country, who can be properly trained and certified and thus they can be absorbed by the major paint companies.

In the end Mr S Mahesh Anand, president-elect, IPA gave the concluding remarks and vote of thanks

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