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India will be one of the four major hubs of innovation & manufacturing for Schneider: Jean-Pascal Tricoire


India is likely to become the fourthlargest market for global automation and energy management major Schneider Electric, as it looks to boost operations in the country on the back of its recent .`14,000-crore deal to acquire Larsen & Toubro’s electrical and automation business, the company’s Chairman & CEO Jean-Pascal Tricoire said. This investment is the French multinational’s largest in the world, and will help boost exports from India, which already account for a third of its output, he said. In an interview with ET’s Nishtha Saluja & Himangshu Watts, Tricoire also said that the world economy is in a very good shape, which is great for business although there are concerns of protectionism and trade tussles. Edited excerpts:

How is business looking in India?

We have 24 factories in the country. That’s before speaking about our merger with Larsen &Toubro (L&T). We’ve got 20,000 people that we employ directly at Schneider. Of which, 1,500 people are in R&D. We are represented in 60,000 points of sales. The big investment that we did is our merger with L&T, which is 5,000 more people joining Schneider. I am very excited about this new step in our history in India, also because there’s a lot of personal story in that. My first contact in L&T dates back to 2002 and I had been meeting regularly (with) chairman Naik since that time. That decision was pondered over 16 years of regular contact. It has been a mature decision on both sides.

So you had your eyes on it for 16 years?
Yes. That’s been a long dating! With the merger of two companies, India would be one of the four major hubs of innovation and manufacturing for Schneider. One being the US, the other one being China, the third one being Europe, and the fourth one, with time, would be India. But India as a business would become bigger than France. So it’s a very strategic, central and critical project in the history of Schneider. Of the top three countries in Schneider, two would be in Asia, which shows how Asia-centred we have become over time.

What’s driving this shift towards Asia?
When you look at Schneider as a simple mission, we bring to our customers, energy and digital solutions. In our business, we are working on a difficult equation — there are many places that still need a lot of access to energy, while some places are really choked by the effects of energy. Speak about pollution in Delhi or in Paris. We are dedicating every rupee of what we do at Schneider in converging energy and digital to resolve that equation. That equation is to make energy greener and much more efficient.

What is driving us to Asia quite naturally, when you look at what is driving the inflation of energy consumption, it’s very simple, it’s urbanisation, industrialisation and digitisation. The centre of gravity of these is in Asia. I am not saying that Asia is everything. We have a very strong presence in North America, Western Europe, but this is the place where we see the highest development today.

How would you assess India’s transition to renewables?

What are the constraints? I don’t see India differs from the constraints or the journey. First, it’s gonna take a lot of time and probably for many years, many, many years, we are going to need all forms of energy. Many things can be run from renewables but not all things can be run from renewables. You need base load to run your smelters, big manufacturing, you need more traditional forms of energy. But globally what you’re going to see, is massive role of electricity, I mentioned electric cars. Globally, one source of consumption which is growing faster is digitisation — everything around data centres, and IT. Especially in India which is a big IT country, that is very true.

How profitable is India for you?

To be frank, (it’s) less than the average of the group because it’s a place of investment.

And what’s your profit growth like?
We keep on investing. At the moment it’s more about growth than anything else.

Could you give us a figure around your investment plans?
We are just in the process of realising an investment of Rs 14,000 crore with the merger of L&T, so it’s pretty big.

Are you happy about the US policies under Trump?

What about India? (laughs) What do you think?

You mentioned India would be one of the four hubs. What exactly do you mean?

The hub means pretty autonomous centre. It already is, to a very large extent, equipped with manufacturing, more so with R&D, which is also a centre for export. In the case of India, already one-third of what we do is export, and all over the world. In this case a large part of that export is very high technology. As we merge with L&T, the main objective is to open the door of the global market to the technologies of L&T.

So L&T business will be exporting much more now, with your help?

Yeah, that’s the objective, because we don’t do the same kind of products. Products of L&T have many applications in many geographies of the world.

Do you see exports from India rising?
I want to see it growing.

Any targets in mind?
We are pragmatic people, one step at a time.

Are you looking at any more acquisitions in India?
Athe moment I’ve got quite a lot to do with what we have, so that’s fine, enough! (laughs)





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