July 15, 2011: Nirmal K Minda

What is the rationale for these buyer-seller meets?
We face the challenges of trying to be an international quality supplier. So we thought we must strengthen the Tier 2 and 3 suppliers to make our industry global. We need to give them a platform. Usually, Tier 1 display their products for OEMs; now we want the Tier 2 and 3 to do so at this meet. About 48 of them are Tier 2 and 15 are Tier 1 suppliers.

What are the main problems that suppliers face?
There are finance problems. So we have Sri City and SIDBI here to support the smaller vendors.

Given the increasing interest rate regime, is this the way forward for Tier 1 to help Tier 2 and 3?
We have to support Tier 2 and Tier 3 for a while. Interest rates have gone up to 13 percent from seven percent. It has become tough for the smaller vendors. We at Minda have a fund so that we can help them and it enables us to give them bill discounting at lower rates of 10 to 11 percent. Those who are dependent on us are the ones who we try and help.

How are you helping smaller vendors on the quality front?
We have the ACMA Centre for Technology (ACT) and work through them to enable them to achieve quality. Cluster programmes are already in progress to help vendors. We also have a variety of training programmes.

How does the slowdown impact you?
It was not what we expected to happen. They need to invest for capacity and smaller players must endeavour to have a diversified customer profile. If Tier 2 is dependent on only one Tier 1 player, then it is prudent for them not to have more than 50 percent on one company. Also, increasing capacity for space and machinery involves costs. Then there are manpower challenges too.

How do you handle manpower?
Manpower is a key challenge. We have to empower and trust people. We are not hire and fire and not as loyal as the Japanese are. We need a balance.

What is your view on the current slow rate of growth?
It will be tough because of the Free Trade Agreements with Japan and Thailand will be something we have to be prepared for. New products will be added and we will have to prepare for new rates that kick in for raw materials like aluminium. It is a challenge for us.

What about your joint venture with the Japanese?
After China, India is the land of opportunity. The market is big and we have to be prepared. Our joint venture with the Japanese will surely have its up and downs but in the long run, our industry will grow.