The Indian Outlook

Strengths:

• Large domestic market.
  
• Large availability of technical and able manpower at low cost.
  
• Vibrant economy growing at a reasonable pace.
  
• Large areas under plantation and abundant availability of local raw material.

Weaknesses:

• High capital cost
  
• Bad infrastructure at high cost
  
• Lack of distribution channels
  
• Unfavourable tax structures
  
• Insufficient availability of quality input material (e.g. particleboards, MDF) and hence the need to depend on imports

Opportunities:

• Almost a virgin domestic market
  
• Growing economy results in more purchasing power and so demand far outstrips supply
  
• Low cost of labour allows for favourable production costs for exports
  
• "Indian-ness" of products that can be exploited in export markets

Threats:

• Vagaries of government policies
  
• Cheap imports of products often under-invoiced
  
• Competition from countries such as China, Vietnam, etc.

Conclusion:

Right now we are at the crossroads. Whereas, at the moment for the domestic market it may be suitable and sufficient to have small and medium enterprises, for the export market it would probably be necessary to go in for considerably large facilities.

While many small and medium factories do exist in India at the moment, there are very few facilities capable of large output for a significant contribution in the export market. If one needs to, as one must, play a major role in the markets abroad, there is no alternative but to establish large enough facilities. As of now the potential for export exists, but the domestic facilities are not large enough to satisfy the markets abroad.

All said and done, no decision can be made without assessing the strengths and weaknesses peculiar to the sector. The ground realities that have been mentioned earlier are a common factor for all industries. There are specifics for the woodworking sector itself and the future direction and milestones probably have to be marked on the basis of a detailed analysis.

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