Bicycle industry in national and international context

By: R D Sharma

Average velocity of motor vehicles plying in Central London today is 12 to 15 miles an hour is equal to countryside speed of bicycle in India where most of the bicycle users reside. This is the state of major metropolitan cities around the globe. Inspite of facilitating smoother flow of vehicular traffic with flyovers, tunnels, bridges as always the problem of congestion stays. New tax in the form of congestion tax has already been introduced in number of cities and others in Europe, America and Japan are planning to follow the same practice.

With the invention of wheel in 3600 B.C. in Mesopotamia, the bicycle came into being after the bullock cart. Last century witnessed the fast pace of life and the man graduated to rockets and outer space. Inspite of all these changes the basically simple, non-polluting and economic vehicle, the bicycle stays in our lines.

Manufacturing base of Indian bicycle Industry is half a century old. Industry concept and common man's requirement was based on roadster models of all-purpose use of the man on the street. Growth of bicycle industry kept pace with socialistic pattern of economy in the first three decades and the home industry grew in equal terms and even slightly more than the growth of the population, diversification into different models also grew proportionally with finally settling at 70 to 80% of roadsters and nearly steady for children bikes at 6 to 8%.

Safari Bikes Ltd

Initially Indian Govt. policies sheltered bicycle industry by extending sales tax and excise concessions till WTO regime came on the scene. Since the production base of bicycle industry is at the crossroads of international competitive market, two strong points of cheap labour and trained manpower remain but the Govt. has to chip in and WTO norms remain competitive.

Transformation in Indian Bicycle Industry has to be observed mainly in the export field. Indian exports already had its presence in Africa, Middle East and to some extent in neighbouring Asian countries. Inroads were made in Latin America in the first half of last decade and these were mainly bicycle components and bicycle tyres and tubes. Industry grew in terms of volumes but no improvement or investment was recorded in terms of design and quality improvement. On domestic front the production grew at the rate of 10% per annum. Partial improvement in terms of design and volume has been recorded in the fancy, multigear MTBs for the city youngsters and this trend is likely to stay. In addition to the above children bikes segment has also shown upward trends in terms of sales and popularity.

India is today, the second largest country in terms of population after China and the bicycle here is mainly considered a vehicle of the poor man. There may be small segment of fancy bikes for urban youths but major share is taken by time tested sturdy roadster and mainly for transportation and small time business. This may be appearing so but the hard facts are strikingly different.

Statistics show that percentage wise, we in India are at the lowest range as bicycle users or owners of bicycles. In India less than 8% of the population possesses bicycle as compared to 30 to 40% of China or other advanced countries of the west. No doubt, the type of bicycle owned by a Chinese or European varies in the type or the model and the uses it is put to. In Europe and America car owning families, simultaneously own more than one bicycle per family. Bicycle holders form part of car assessories and on the week end cars can be seen trailing out of metros with cycles harnessed on top of the cars. Similarly, in China nearly 1/3rd areas of all roads is reserved for cyclists. On a working day Capital city of Beijing is a sea of bicycles. Workers as well as Senior Executives go to work on bicycles. Most of the European and American city roads have lanes reserved for cyclists and the riders have priority over automobile traffic.

Future of cycle industry in India is to be seen in the context of economy, taxation, urbanization, public health, technology and various types of pollution and the roads. In the growing economy of India which is mixture of both the socialist and capitalist forms and signatory to WTO norms the bicycle will remain the mainstay of the population at the lower levels of economic strata. Certainly percentage of fancy bikes, children bikes and a negligible share of standard or exercise bikes will be consumed by middle and higher income group of society.

With certain gaps of time, Govt. of India. In the year 2002 imposition of excise of 4% in the budget was unthoughtful action of the Govt. without going into intricacies of the manufacturing process of a bicycle. Same folly was repeated in the year 2003 in the form of VAT but it was modified due explanations and justification by the industry. The bicycle may be simple and basic mechanical device but it was nearly three hundred types of components, which are produced by small time vendors. For example, to manufacture a pedal various components required are steel balls, axle, nuts & bolts and rubber parts, which are manufactured by different manufactures. To levy excise at all stages, total excise could have multiplied a number of times. After repeated representations by the industry this anomaly has now been removed.

To maintain lead and sustain the bicycle industry as a denominator of industrial and economic growth factor, are of steel prices is to be kept under careful watch. Steel prices keep fluctuating globally and major players like US and Japan cal the shots. On national level, steady and constant supply of raw material like steel can help boost this industry.

Central and state Governments while planning city roads should ensure cycling space to encourage use of bicycles. Hi-Bird Group of industries manufacturing world class models and variety of country use bicycles have already promoted use of bicycles by conducting rallies and school children's cycling competition, a number of times.