Hitachi India sees the country as its key strategic market and plans to make it an export hub. The Japanese firm is looking at various businesses for expansion in India, including IT, Healthcare, Transportation, Water, as well as Oil and Gas.

Managing Director Kojin Nakakita spoke to BusinessLine regarding the company’s growth strategy and how business in India, if less complicated, could make Japanese firms’ contribution more visible. Excerpts:

How important is India for Hitachi globally, in terms of the overall business?

India is one of the most strategic markets.

As part of Hitachi’s 2015 Mid-Term Management Plan, the management envisions a substantial contribution by overseas markets, in terms of contribution to the overall growth strategy.

It would be difficult to ascertain the exact percentage, but revenue in India was about ¥160 billion as of FY2014 and we target ¥210 billion at the end of this fiscal.

What are your future investment plans for Indian operations?

Presently, we are considering a lot of options. Expansion plans are being evaluated and analysed. IT, Healthcare, Transportation, Water, and Oil & Gas are the areas we will be focusing upon. Recently, we started one of our other manufacturing facilities in Chennai in the automotive space.

We will make India an export hub for a lot of our products.

What are the key areas and strategies you plan to focus on?

The future appears challenging, yet promising. Hitachi aims to globalise and localise operations by offering technological expertise to the society, and nurturing cities and towns to become self-reliant as well as combat rapid urbanisation issues.

I see sentiments are just right for carrying out business and expanding Hitachi’s base in India.

What are the expectations from the Indian government in the context of growing Indo-Japan trade ties?

India has the right mix to become one of the largest economies but when you delve deeper into the system, one would shy away to offer a big commitment due to stringent tax regimes and laws. It is indeed a challenge to overcome issues prevalent in the current system related to customs, taxation etc.

The moment Japanese companies feel comfortable and perceive that conducting business in India is not complex, Japan’s contribution will be highly visible.

What is the size of the business that the smart cities mission presents for Hitachi?

Hitachi in collaboration with CII has formed a consortium that will create pilots and replicate them throughout the country for setting up 100 smart cities.

Hitachi in this way is leveraging opportunities in each of the sectors. Once we kick-start delivering on the expertise we possess, visible transformations will be witnessed. The length and depth of the entire smart city project shall be observed post implementation.

Are you increasing the manufacturing capacity across businesses in tune with the ‘Make in India’ initiative?

Hitachi has been aggressively expanding its manufacturing base in India and feels the campaign is a successful step towards inviting more FDI, offering qualitative products to Indian people through localising the product, and exporting them from India.

Hitachi has set up its base in Gujarat, Chennai, and Neemrana (Rajasthan) to explore business opportunities in areas of water treatment etc, and is poised to further expand the manufacturing base.

We will provide new services to sustain the advancement of financial services in India, including settlement services for banking institutions, ATM operation services, as well as cash operation and management solutions. We will provide these mainly through Hitachi Payment Services. Furthermore, in the rail systems business, Hitachi will consider local production in collaboration with Indian companies, subject to project pipeline.

How are you looking to grow your consumer durables business?

Consumer durables are very much part of our growth story in India and we are rapidly progressing towards achieving the leadership position in the premium segment. The production of ACs is being carried out in Ahmedabad and Kadi. We would like to focus on expanding the same manufacturing facility.