Indian engineering and construction conglomerate, Larsen & Toubro is bullish on the booming Chinese market and has recently secured three major contracts worth nearly $30 million, a top company executive said in Beijing.
"We are really excited by the prospects of participating in the vibrant, growth-oriented economy by building long-term relationship with the Chinese industry," chairman and managing director of L&T, A M Naik said.
"China will receive special focus in our plans. This is precisely why I am visiting China for the second time in eight months," Naik told PTI.
L&T, which ventured into China in 2004 has already secured orders worth over $100 million, he said, adding since September 2004, the company has received three major orders from Chinese hydro-carbon sector worth nearly $30 million.
As part of its long-term commitment to the Chinese market, L&T this week opened its Beijing representative office, the company's second office in China.
He said L&T, which opened its Shanghai representative office in 2004, envisages engagement at multiple levels with the Chinese industry.
With the inauguration of the Beijing office, the first phase of L&T 's China strategy is nearly complete, Naik said, adding that the second phase will entail the positioning of four to five key sourcing personnel, including experienced Chinese staff.
"So far, we have merely been selling our products in China. Now we want to move into sourcing in a big way," Naik said.
"In our endeavour to become a major international player, global integration of our value chain is imperative. To stay globally competitive, we recognise the important role China can play in our corporate strategy," he said.
He said sourcing from China will be key to global companies' efforts at staying competitive. L&T will source raw materials, machinery and electrical components from the Chinese market for its manufacturing facilities in India.
The third phase of the company's China strategy, which is still at the conceptualisation stage, will involve setting up a manufacturing base in Beijing.
"China is a huge market so if any company wants to truly be a big player, they must be in China," Naik, who also attended the just-concluded 2005 Fortune Global Forum, said.
By establishing manufacturing facilities in China would enable L&T to "de-risk" itself. "If we only manufacture in India, we have all our eggs in one basket," he added.
"We expect to make China a manufacturing base for our various products, for exports to our major customers in the world markets," he said.
