New Delhi [India], April 15 : The global trade market for power and hand tools, currently valued at approximately USD 100 billion, is projected to grow significantly, reaching around USD 190 billion by 2035, according to a report by NITI Aayog.
The report on Hand and Power tools sectors - 'Unlocking USD 25+ Billion Export Potential - India's Hand & Power Tools Sector', observes that hand tools account for USD 34 billion and are expected to expand to 60 billion by 2035, while power tools, including tool accessories, represent USD 63 billion and are anticipated to surge to USD 134 billion, with electrical tools comprising the majority.
China dominates global exports, holding about 50 per cent of the hand tools market with USD 13 billion and 40 per cent of the power tools market with USD 22 billion, whereas India has a smaller presence, exporting USD 600 million in hand tools (1.8 per cent market share) and USD 470 million in power tools (0.7 per cent market share).
One important finding of the report is that India has the potential to capture a larger share of the global market, targeting USD 25 billion in exports over the next decade, which could create approximately 35 lakh jobs by achieving a 10 per cent market share in power tools and 25 per cent in hand tools. Through fostering innovation, empowering our MSMEs, strengthening India's industrial ecosystem, we can solidify the nation's position as a reliable, high-quality global manufacturing hub. The potential rewards for Indian economy and its people are immense.
The report also analyses the challenges which India may face, including a 14-17 per cent cost disadvantage compared to China, driven by higher structural costs and smaller operational scale.
This disadvantage stems from elevated raw material costs, such as steel, plastic, and motors, as well as lower labour productivity due to higher overtime wages and restrictions on overtime hours. Furthermore, higher interest rates and logistics costs for transporting goods from inland states to ports further hinder India's competitiveness in the global market, the report said.
To achieve India's potential of USD 25 billion in power and hand tool exports over the next decade, the report delves into the issues impacting hand and power tools sectors and recommends three key categories of interventions which are essential.
The report underscores the transformative potential of the hand and power tools industry for India's economic growth, delving into the challenges, policy headwinds, and necessary interventions vital for strengthening the Indian hand and power tool ecosystem.
It outlines a strategic path for the sector to enhance its global competitiveness and capture a significantly larger share of the international market. The report was launched by Suman Bery, Vice Chairman, NITI Aayog in the presence of Dr VK Saraswat, Member, Dr Arvind Virmani, Member, and BVR Subrahmanyam, CEO, NITI Aayog.