Shamli

District Profile

The district ‘Shamli’ is newly carved out from Muzaffarnagar under Saharanpur division. It was known as Prabuddhnagar when this district came into focus. It is situated on Delhi-Shamli national highway, which is 100 km from Delhi, 65 km from Saharanpur, 38 km from Muzaffarnagar and 38 km from Panipat (Haryana).

The borders of Shamli are connected with district Muzaffarnagar in East, Panipat in West, Saharanpur in North and Baghpat in South. The district has a legend that Lord Shri Krishna (also known as ‘Shyam’) chose this route from Hastinapur to the war zone of Kurukshetra and blessed the place. Therefore, this city was known as ‘Shyama Wali’ or ‘Shyama Nagari’ earlier and now it is called ‘Shamli’. It has a significant role in historical movements. According to available evidences, Maratha warriors developed it as a cantonment. Revolutionaries in the freedom movements of India used it as their one of the safest hideouts. In English reign, the freedom fighters burned the “Purnai Tehsil” and started the 1857 Kranti by sacrificing their lives. Shamli cluster has evolved over the years producing rim, axle and trolleys for animal-drawn vehicles. In the district, there are three major manufacturing clusters — Kairana-Panipat Road, Delhi Road and Muzaffarnagar Road. The major industries present in Shamli district include rim and axle industries, sugar mills and distilleries, paper mills, rolling mills and steel units, casting units, steel and aluminium utensils industry (bartan), chemical units, pharmaceuticals units, agricultural equipment units etc.

Geography

Located in northern Uttar Pradesh, adjacent on its west to Haryana and just about 100 km from Delhi, Shamli district is well connected via roadways and railways. Three national highways (NH-709A, NH-709B, NH-709AD) and multiple district roads pass through the district. It is, in fact, at the intersection of the three major national highways. This allows Shamli to have unhindered access to the entire nation. Uttar Pradesh is a landlocked state, this has increased dependence on road and rail network for cargo movement immensely. Shamli railway station lies on the Delhi-Saharanpur railway line under the Delhi Division of Northern Railway, which provides it connectivity with all major cities in India.

Industrial profile

Carved out of Muzaffarnagar in 2011, Shamli is a part of the NCR with its total population (13.13 lakh) at 0.7% of the state’s total population. Shamli has a sex ratio of 878 females for every 1000 males, and a literacy rate of 53.89%, both of which are well below the state averages (sex ratio: 912 and literacy rate: 68%). However, the district’s performance in terms of class 10 drop-out rate of 18.5% is slightly better than the state rate of 23.2%.The major industries present in Shamli district include rim and axle industries, sugar mills and distilleries, paper mills, rolling mills and steel units, casting units, steel and aluminium utensils industry (bartan), chemical units, pharmaceuticals units, agricultural equipment units, flour mills/ besan units/ food units, plastic and rubber industries, disposable plastic crockery industries, cattle feed industries, kitchen item industries, packaging industries, electricals industries, bricks kilns, and interlocking tiles industries.
Most of these units are present in two industrial areas of the district, with about 3,108 units in operation. None of the industrial areas are sector specific; and consist of industries involved in multiple sectors. Shamli has multiple industrial associations with chapters of both national and state level associations also present in the district. However, all rim and axle manufacturers are part of Indian Industrial Association (IIA). With around 54% literacy Shamli has larger section of population working in agriculture majorly in production of sugarcane, rice, wheat and millets etc.

MSME landscape of the district

 
Type of Industries Micro Small Medium Total Unregistered Total
Rim & Axle 12 1 1 14 16 30
Agricultural Implement manufacturers 10 2 0 12 3 15
Iron Fabricators (Trolleys, gates, grills) 31 0 0 31 69 100
Total 53 3 1 57 88 145

Major Exportable Product from Shamli

The total export from Shamli is approximately INR 251.7 Crore for the period “September 2020 to November 2021” . The following table depicts the value of export of major products from Shamli:

Major exportable product

 
S. No Product Export value (in INR Crore) from Sep 2020 to November, 20215
1 Road wheels and Prts and accssrs thereof 7.47
2 Boneless meat of bovine animals, Frozen 96
3 Cane Molasses/ RFNG of Sugar 12.2
4 Match Splints 10.7
5 Other Cane Sugar Excl. those specifiec in Note 2 64
6 Other Craft Paper and Paperboard Weighing 150 G/M2 Or Less Unbleached 1.5
7 Other Uncoated Papr And Paprboard 7.5
Total Export from Shamli 251.7[1]
Product 1: Iron Fabrication

The ODOP Product for Shamli district is iron fabrication products. The iron fabrication industry in Shamli comprises over 190 registered and unregistered MSME industries engaged in the manufacture of rims, axles, agricultural implements and fabrication of gates/grills/trolleys.

Cluster Overview

The ODOP Product for Shamli district is iron fabrication products. The iron fabrication industry in Shamli comprises over 190 registered and unregistered MSME industries engaged in the manufacture of rims, axles, agricultural implements and fabrication of gates/grills/trolleys.
. The industry is labour-intensive due to the heavy dependence on conventional, self-made machines that have been customized by manufacturers to suit their business requirements; fabricators of gates/grills, trolleys, particularly, use manually operated hand tools. It is estimated that this industry provides employment to about 1,700 workers. Of these, 20% are skilled, 75% semi-skilled and the remaining 5% unskilled. Disaggregating total employment by the type of products, 43% workers are employed by the rim and axle manufacturers, 19% in fabrication of agricultural implements and 38% in gates/grills/trolleys fabrication. The Iron Arts (Fabrication) cluster ecosystem comprises 3 key clusters, 30 rim and axle manufacturing units, 100 iron fabrication manufacturers i.e., gates, trolleys etc. and 15 agriculture implements manufacturing units.

Product Profile

The iron fabrication cluster comprises manufacturers of various kinds of iron and steel products and marketing channels. The rim manufacturing units, axle manufacturing units, agriculture implements manufacturing units and trolleys/ grills/ gates fabrication units form the conversion level and supply goods to the traders/exporters. The goods are either marketed directly to end users or are sold through traders/ exporters. Most of the rim and axle industries have established contact with various traders/ exporters in the country, while most of the iron fabrication and agriculture implements products are sold directly to the customer. i. Rim ii. Axle iii. Agriculture implements iv. Trolley, gates and grills

Rim

Most units are dependent on their customers to provide the product designs, and whatever standard designs are in demand in the market. This section represents the processes and value add by rim manufacturers. Marketing channels for rim manufacturers mostly comprise repeat orders and referrals by existing clients. Few of the players have visited exhibitions to generate new clientele. Online B2B marketing channels such as India Mart do not provide the required results as per consultation. The buyers are generally traders/dealers for automobile parts. Due to the simple nature of the product, manufacturers have no role to play after the sale has been completed.;

Axle

The metal bars are machined (using lathe machines) on their ends to give them a round cross-section. Then, the ball bearings and axles hubs are fitted on each side of the metal bars and then painted and finished. Finally, the products are packaged for transport. Most units are dependent on customers for the product designs and whatever standard designs are in demand in the market. Marketing channels for axle manufacturers mostly comprise repeat orders, and referrals by existing clients. Few players have visited exhibitions to generate new clientele. The buyers are generally traders/dealers for automobile parts for ADVs, trolleys and trailers. Due to the simple nature of the product, manufacturers have no role to play after the sale has been completed. ;

Agriculture Implements

The major agricultural implements being manufactured in Shamli include:
►  Spring loaded cultivator used for tillage and soil preparation
►  Disc harrow used for tillage and soil preparation
►  Land leveller used for levelling the land
►  Ridger used for creating ridges/ cultivation ;
The manufacturing process for all the four products is similar. The first step is mostly machining, the process of cutting raw material into desired shape and size by removal of raw material. Machining includes turning, drilling, milling, etc. Most units use lathe machines or milling machines to carry out the machining operations on the components. The next step involves assembling the machined components with the semi- finished goods, either through welding or through just using nuts and bolts. Finally, the products are checked for operations, and pushed through for the finishing touches and painting. Most units retail the products directly to farmers in nearby regions, sometimes providing after sales service as well. Stakeholder consultations revealed that most buyers are from Shamli and other adjoining districts, mostly in a region of 50 km from Shamli.

Trolley, Gates and Grills

The production process involves machining and welding, followed by finishing and painting Manufacturers follow the processes and value add to designs provided by customers. The major steps involved in the production process are mostly machining and welding, followed by finishing and painting. Most units manufacture as well as retail the products. Marketing channels for machine manufacturers mostly comprise repeat orders and referrals by existing clients. The buyers are generally people constructing houses, factories, and any kind of buildings. Considering the unique product being sold by them, the manufacturers must maintain a separate team to assist in installation of the product as also provide after sales services. ;

Cluster Stakeholders


Industry Associations

Following are four principal Industry Associations/SPVs that are working for the development of Iron fabrication in Shamli:
► Indian Industries Association, Shamli Chapter
► Small Audyogik Asthan Manufacturing, Khedikarmu, Shamli
► Khedikarmu Industrial Estate Cooperative Society Ltd., Shamli
► Wheels Axels and Agriculture Implements Manufacturing Association (WAAMA)
► Krishi Vigyan Kendra, Shamli
► District Industry Centre, Shamli ;

Export Scenario


HS code

The following table lists the HS codes under which the products are exported from the district:;

HS codes for Iron fabrication work

 
HS codes Description
87087000 Road wheels and parts and accessories thereof, for tractors, motor vehicles for the transport of ten or more persons, motor cars and other motor vehicles principally designed for the transport of persons, motor vehicles for the transport of goods and special purpose motor vehicles.
73083000 Doors, windows and their frames and thresholds for doors, of iron or steel
   
87169090 Parts of trailers and semi-trailers and other vehicles not mechanically propelled, n.e.s.

Current Scenario

India's exports represent 0.54% of world exports for this product, its ranking in world exports is 25 behind Germany, USA, China, Japan, Mexico like biggest exporters of the selected product. Since 2015-2018, India’s exports have increased with a good margin for shortlisted product. Going further, Uttar Pradesh can focus on those countries which import the selected product from India with much higher growth rate in recent years i.e., Czech Republic (462%), Ghana (367%), Iraq (183%) and Peru (144%). ;

Export Potential

In 2020-21, India’s total exports for Iron Fabrication (category of products identified for Shamli) was around INR (USD 86,380 billion). During 2014-2018, the major export destinations for India are USA, Turkey, Germany, Brazil, Mexico and Italy. These six exports destinations command more than 50% of the total cumulative iron fabrication products exports from India. In 2018, USA topped the list with cumulative imports worth around USD 891 million. In recent years, Vietnam has become a major importer of iron fabrication products from India, increasing its imports from a meagre USD 8 million in 2014 to USD 123 million in 2018 (CAGR of 93%). Product 87087000 : Road wheels and parts and accessories thereof, for tractors, motor vehicles for the transport of ten or more persons, motor cars and other motor vehicles principally designed for the transport of persons, motor vehicles for the transport of goods and special purpose motor vehicles. Uttar Pradesh exports this product to UK, USA, France, Belgium, Canada, Ghana, South Africa, Saudi Arabia, Italy, Indonesia, Thailand, UAE, Serbia, Malaysia. Below figure shows the top importers for this product (87087000) in the world from India:

Potential Areas for Value Added Product

Product Diversification is one of the most crucial product uplifting strategies which in turn is an important part of a product’s export. This plays a vital role in any products exports as it is a product uplifting strategy. Diversification can be brought in the cluster by: 1. Development of a new products: Knowledge of new technologies and product diversification: EDC to aid in manufacturing new types of products, new technologies emerging in the market, technology providers, price details, etc. 2. Modifications of Existing Products: EDC will aid in tie-up with companies/ organizations/ clusters like ACMA, DIC/DIEPC in other districts to further increase market access and product development.