Engineering giant ABB is looking at India as an export hub for power and automation besides expanding its footprint in the country by buying out companies and backing start-ups in software engineering and applications. “We are keen to make India our export hub for power and automation technology solutions,” ABB chief executive officer Ulrich Spiesshofer said at an interaction with a visiting group of journalists on the sidelines of the Capital Markets Day 2016 in Zurich. Spiesshofer, who believes ABB is ideally poised to partner Prime Minister Narendra Modi’s Make in India programme, underscored the country’s importance as an export hub in areas such as power grids. Besides power equipment, the 125-year old company is engaged in robotics and automation. “ABB India exports to around a hundred countries and its deep local footprint and rich global and local expertise combine for offerings to customers in India and around the world,” he said.
Keen on M&As
On mergers and acquisitions, he said ABB was on the lookout for opportunities globally and India was an area of interest. “There are tremendous software capabilities in India not only in engineering but also in application software. So we are active out there,” Spiesshofer said. Zurich-based ABB’s venture capital arm – ABB Technology Venture (ATV) – which was launched in 2009 and is active in India is exploring opportunities in software engineering, software applications and artificial intelligence. “I am quite excited about it. I will be visiting India soon to meet young entrepreneurs. It is exciting times in India now with start-ups focusing on software, artificial intelligence and the fields that we are interested in,” he added.
ATV has so far invested $150 million (Rs 1,000 crore) globally in technology and energy companies.
India has been part of the company’s increased focus since the tenure of CEO Percy Barnevik (1988-1996), though it had a presence in the subcontinent for over a century. Barnevik, who oversaw the merger of Swedish ASEA with Swiss Brown Boveri Ltd to form ASEA Brown Boveri in 1988, was among the first European corporate leaders to foresee India’s potential. India is a top market for ABB with an annual turnover of $1.3 billion (Rs 8,674 crore) in 2015. The company’s average annual investment in the country has been $100 million (Rs 667 crore), primarily to meet capex needs.
India plans to augment its solar capacity to 100 gigawatt (GW) from 8GW at an investment of $100 billion (Rs 6.67 lakh crore) by 2022, which ABB sees as an opportunity. “The ramp-up of solar energy in India is mind-boggling. It is coming up very quickly,” said Spiesshofer, pointing out that half of the country’s solar power runs on ABB equipment. According to ABB estimates, 70 per cent of India’s oil production are monitored and controlled by solutions provided by the company and more than half of the country’s diesel locomotives run on its turbochargers. It is also working with the government to provide technology solutions for solar-powered agricultural pumps to farmers.
Besides, around a third of the Rajdhanis and Shatabdis run on ABB traction transformers.
ABB also sees major scope in India’s plan to become a fully electric vehicle nation by 2030 and deploy 2,300-2,700 electric buses by 2020. ABB plans to bring in its TOSA (Trolleybus Optimisation Systeme Alimentation) technology for the electric buses. TOSA is the world’s fastest flash-charging connection technology, which offers a 600 kilowatt (KW) boost to batteries in 15 seconds. At present, ABB is setting up a transmission line from the Northeast to Agra with an 8,000MW converter capacity. The link will transmit hydroelectric power over 1,728km to Agra to serve nine crore people in the region. The company will soon compete for India’s diesel-cum-electric engine contracts and is looking for tie-ups with Indian Railways. Spiesshofer said ABB was not worried about the country’s investment climate. “We look at India from a very long-term perspective. Some of the segments are very nicely prospering and going in the right direction. But there are others that are subdued. But we have been in India for long and are not getting nervous about it.”