MARBLE INDUSTRY OF RAJASTHAN
OVERVIEW (Marble Industry) Marble is a crystalline, compact variety of metamorphosed limestone, consisting primarily of calcile (CaCO3), dolomite (CaMg (CO3)6) or a combination of both minerals. Dimensional stones such a marble has been highly popular since time immemorial, being used on facades and interiors of houses and buildings. The term marble is loosely applied to any limestone or dolomite that takes a good polish and is otherwise suitable as a building stone or ornamental stone. Marbles range in color from snow-white to gray and black, many varieties being some shade of red, yellow, pink, green, or buff; the colors, which are caused by the presence of impurities, are frequently arranged in bands or patches and add to the beauty of the stone when it is cut and polished. Marble is used as a material in statuary and monuments, as a facing stone in buildings and residences, and for pillars, colonnades, and paneling, wainscoting, and floor tiles. Like all limestone’s, it is corroded by water and acid fumes and is thus ultimately an uneconomical material for use in exposed places and in large cities. The presence of certain impurities decreases its durability. Marble was extensively used by the ancient Greeks; the Parthenon and other famous buildings were constructed of white Pentelic marble from Mt. Pentelicus in Attica, and the finest statues, e.g., the Venus de' Medici, from the remarkably lustrous Parian marble from Paros in the Cyclades. These same quarries were later used by the Romans. Among the famous marbles of Italy are the Carrara and Siena marbles of Tuscany, which were used by the Romans and the Italian sculptors of the Renaissance. Marbles are quarried in all parts of the world. The finest marbles in the United States come from Vermont, which produces large quantities. Other states important as marble producers are Massachusetts, Maryland, Tennessee, Alabama, Georgia, Missouri, California, Colorado, and Arizona.
MARBLE PRODUCTION & REGULATION The production of marble passes through several stages. The main stages are demonstrated in Figure1. The first stage of production is (1) exploration and identification of a quarry location, followed by (2) extraction of marble from the quarries,
then (3) lifting and transportation, (4) inventory management, (5) cutting the stone into slabs and tiles, (6) polishing, and finally, (7) distribution to end users.
FIGURE1. Production & Regulation of marble
CHARACTERISTICS OF THE MARBLE INDUSTRY: COMPETITIVE ANALYSIS The Marble Industry has unique competitive characteristics that differentiate it from any other industry in terms of technology use and operational characteristics, in addition to its differentiated market characteristics. This industry deals with a natural stone that is appreciated worldwide and has such a high level of product differentiation inside the same country as well as from one country to the other. In this industry, what differentiates the raw material from the final product is the cutting and polishing that is exercised on the
raw material which refines it into a final product. India enjoys abundance and high quality of the raw material, yet the production process in India has still a way to go to reach the advanced levels enjoyed by the top producing countries. Nevertheless, the marble industry in India is growing from one day to the other and it is very valuable studying and analyzing the market characteristics of this industry in India. In this market, we have varying types of competition: quantity (capacity) competition exists where the suppliers that can provide big quantities and can operate their own quarries have a clear edge over others. However, there is also a tough price competition. Small suppliers sometimes dump the market by lowering their prices severely, just for the sake of selling their product and generating cash. Therefore, bigger marble producers on scale do not always enjoy a 20 price advantage even though their average operating cost may be lower. Also, market competition is highly differentiated by quality (vertical differentiation). This depends on target demand and whether the end user is local or production is done for export purposes. In addition, horizontal differentiation also exists (according to type and color of marble produced). Usually, horizontally differentiated competition is for suppliers who target the elite market.
There is hardly any seasonality of demand. Marble is required all year long, although it follows very much the business cycle of the construction sector. If the construction sector witnesses a boom, the marble industry is always expected to follow and vice versa. Moreover, demand is usually higher in summer, as construction work is more intense in summer than in winter, for several reasons among which are that days are longer and the weather is more predictable.
WORLD SCENARIO OF MARBLE INDUSTRY Worldwide, marble has a trade of $45 billion. Despite having one of the biggest marble reserves in Asia, Pakistan has a share of one percent in the world market. Pakistan earns about $20 to 30 million from marble, onyx and granite and their products export to the United States, China, Europe, Middle East Italy, UK and Germany. The government has set marble and granite export target to $500 million by 2013, after establishment of model quarries and Marble Cities initiated by Pakistan Stone Development Company (PASDEC).
Marble is an export oriented item. During 2007-08, the country earned around $35 million from the marble and its products export, while in 2006-07, it was $22 million. The Small and Medium Enterprise Development Authority (Smeda), is taking keen interest in the development of this industry. In addition, Smeda has planned to set up a modern technical training institution to provide assistance in establishment of marble industry and trained its workers. This would not only ensure availability of skilled local labour for the industry in required numbers, but also help it to compete with the marble products in international market. Worldwide natural stone extraction is estimated at 1150 million ton per year. Annual production after deduction of waste and cutting losses amounted to about 820 million, referred to a slab thickness of 2 cm. The total production value was estimated at $40 billion.
The global growth took place outside Europe. China now extracts around twice as much natural stone as the previous market leader Italy. India also overtook Italy last year for the first time. The most important world importer of finished goods is the USA. Stone products worth $1.72 billion were imported in 2003, 18.3 percent more than a year ago. The most important supplier was Italy, which increased its US exports by 7.2 percent to $535 million within two years. India's contribution to the world stone market was 10 percent and it produces 27 percent of the world's stone. The annual growth was about 15 percent and it is now the third largest natural stone producer in the world, after Italy and China, and plays an important role in world trade of natural stones. China has become the important player of world markets in marble and granite tiles especially in gray, pink and other light colors. Its fast increasing presence has sharply accelerated the trend of lower prices. China exported natural stones and its products for more than a billion dollar last year. The natural stone exports increased by almost 20 percent from 924 million dollars to over 1.1 billion dollars in 2003. Italian natural stone exports have increased by 5.6 percent in quantity and 2.7 percent in value terms in the first half of 2004. The total export quantity of marble, granite and other processed solid stones reached 1.53 million ton in the first six months of 2004, compared with 1.45 million ton in the first half of 2003. The export value rose from 792 million euros to 813.1 million euros. The growth was attributed mainly to more exports of granite and granite products. During the last 5 years production of marble was as follows:
Technical advancement in the last seventy years had increased the world production and consumption of dimensional stones to 49.5 million tons. Due to increase in world consumption the granite and marble trade reached US$ 3.5 billion mark in 2008. Italy is the major player in the global market and exported 38 percent of the dimensional stone's export, while its imports were 18 percent of the international imports. Other major exporters include Spain, Turkey and Portugal. Other major importers were USA, China, Germany and Hong Kong.
India has been the main exporter of granite and sandstone for the five years. Its exports have declined by 46 percent in five years but it managed to capture 15.2 percent of the granite trade in 2008. Norway has a share of 12.4 percent and Italy captured 9.1% of the market. Italy has been the largest importer of granite and sandstone for the last five years and accounted for 39.4% of the total imports with a value of US$ 415 million in 2008. During the 9 months of 2008-09 export of marble and granite from Pakistan increased by 18.07 percent. However, in 2008 granite accounted for US$ 85 thousand in foreign exchange earnings, which was approximately 0.01 percent of global granite exports. While the share was 0.03 percent in 2004, exports were US$ 208 thousand.
Marble and granite processing industry is typical in nature, its efficiency is dependent on the quarry products. In most of the above countries processing is done on highly sophisticated machinery for quality production. In Pakistan where few units are using these machines while rest of the industry uses locally fabricated machinery by few existing manufacturers in the country. These units develop machinery by reserve engineering (copying of foreign machines), without even doing the basics of machinery designing. Italian processing industry is far ahead of the world with locally manufactured machinery of high standards. Many countries have entered into collaboration arrangements with Italy and other leading stone machinery manufacturers in Germany, USA and Netherlands. Marble and Granite is the sixth largest mineral extracted among coal, rock salt, lime stone, china clay, dolomite, fire clay, gypsum, silica sand etc. Since 1990, mining & quarrying has consistently contributed 0.5 percent to the Gross Domestic Product. In Pakistan marble is processed in more than 1,600 units in the country including 685 small and medium size units. These units have been defined in three categories according
to their sizes, small, medium and comparatively large, but not up to the international level. Unfortunately the processing strength for granite in the country remains unsatisfactory. There are only nine units, of which four are operational. All of these units have an average investment of over Rs.20 million with gang saws, block cutters and polishing heads. Due to hardness of granite, production capacity of granite processing units is low as compared to marble. Average production of these units is 6,000 to 8,000 sq/ft per month per unit. Most of the units even those with good quality machinery setups are unable to produce high quality products because of substandard raw materials and low skill level of the workers. International buyers allow variation of 0.5mm for tiles and 1.0mm for slabs. Prevailing industry average variations are too high and do not match to the international standards. Seeing vast opportunities in these sector Italian businessmen have started looking towards Pakistan for the exploitation of its marble and granite reserves to keep their marble industry alive as after about 25 years the Italian reserves of this mineral wealth would exhaust.
Italy is pioneer in introducing mining technology by extensive research and development; mining is carried out on modern lines in most of the countries except for a few developing countries, including Pakistan. Standard quarry wastage in the world is taken at 50 percent of the gross produce; however, in Pakistan this quarry loss is estimated 61 percent to 73 percent. Italy had 2,500 years history of marble industry, and had been a leading nation in the dimensional stone business for centuries it has a long base of model mines with the highest global average for quarry production and state-of-the art processing industry. Italy is the leading manufactures of stone products, materials and technology, while Pakistan is one of the few countries endowed by nature with large reserves of marble, onyx and granite. Therefore, its industry can be benefited from Italy’s experience. In Pakistan only a few unit are equipped with proper equipments and produce quality marble and marble products. Generally Pakistani finished goods are of poor quality. Processing wastage of 45 percent to 55 percent has been estimated. The primitive mining techniques existing in Pakistan do not allow extraction of standard blocks; a major factor for the decline in Pakistan's marble industry are slowdown in the construction industry, lack of quality production and an inconsistent and irregular supply of raw material. The extraction in Pakistan comprised boring of holes in the bedrock, which were filled with explosives to blast the block, which results not only in a high wastage (up to 73 percent), but also in smaller stone size, which substantially reduces the price, which is directly proportional to size. The extraction of marble in Pakistan was yet to be developed and value-addition to all marble products can be done with the help of modern machinery from Italy. It is considered that Pakistan is the right place for foreign investment, in mining as well as the training of manpower involved in the marble sector and Italian businessmen can avail this opportunity.
INDIA’S SCENARIO OF MARBLE INDUSTRY Products India possesses a wide spectrum of stones ~ granite, marble, sandstone, limestone, slate, and quartzite. It is amongst the largest producer of raw stone material.
Production areas Marble deposits are widespread in India: concentration in states of Rajasthan, Gujarat, Madhya Pradesh, Haryana, and Andhra Pradesh. Next Gujarat also produces some very fine marble followed by Madhya Pradesh. Rajasthan is the main depository of marble; accounts for over 90% of total marble production in India [1100 m tons]. Newer varieties of marble are being developed in Bihar, Jammu & Kashmir, Maharashtra, Sikkim, and Uttar Pradesh & Bengal.
Production Technology Industry has evolved into the production and manufacturing of blocks, flooring slabs, structural slabs, calibrated - ready to fix tiles, monuments, tomb stones, sculptures, artifacts, cobbles, cubes, pebbles and landscape garden stones.
Advent of sophisticated mining machinery & new mining fields has led to increase in marble production. Although India produces machinery, there is an excellent opportunity for exporting machineries for working stone: cutting, sawing, grinding and polishing.
Indo-Italian Trade Italy imports blocks and after cutting and processing exports these all over the world including India. Italy imports large amounts of granite from India around € 62 million as compared to imports of Marble which amount to only € 5 million (inclusive of blocks/tiles/crude/trimmed)]. The whole world economy is facing the recessionary trend since past few years. This has affected most of the industries, but the commodities of necessity. As marble is not an essential commodity, marble and related industries have faced a decrease in demand due to decreased purchasing power of consumers.
Import statistics indicating opportunities for Italian companies: • [Finished, trimmed, tiles/monumental blocks]
Machinery for cutting, sawing, grinding and polishing
MARBLE BLOCKS IMPORT INTO INDIA Import of Rough Marble Dimensional Blocks, marble slabs and tiles (other than cut and polished marble slabs and tiles) is allowed only by special licenses issued by the Director General of Foreign Trade in India. Till now, annual licenses are issued to those eligible to import marble blocks into India. For the year 2008-2009, licenses totaling upto 140,000 tons of rough marble blocks, slabs and tiles (HS Classifications 25151100, 25151210, 25151220, and 25151290) will be issued to existing marble sawing and processing units in India who have imported rough marble blocks and slabs in preceding years when licensing was applicable. Units who were hitherto eligible to apply for licenses are those units that were importing marble blocks in period preceding the year from which restrictions came in force. Out of total licenses of 140,000 tons, eligibility for each eligible license holder is normally worked out on basis of turnover for the year 2007-08 i.e. the turnover of the eligible firms for the year 2006-07, or the turnover of these firms for the year 2004-05 with a cap of 10%, whichever is less. The licenses are issued on actual user basis and the maximum entitlement is 14,000 tons for any single license holder.
There are certain points to bear in mind regarding these licenses:1. These licenses are not applicable to 100% Export Oriented Units or Units in Special Economic Zones that are eligible to import rough marble blocks and slabs for processing export orders directly or as deemed exports. 2. A passbook is maintained for the imports and the importer has to file monthly returns with the licensing authorities to keep record of the amount of imports and balance available. 3. Import of Dolomite is banned against these licenses. Therefore what is known as Thassos White Marble cannot be imported in rough blocks or slabs form other than by 100% export oriented units. For domestic consumption in India, Thassos White marble has to be imported in cut and polished form only. In case an eligible importer fails to use his full entitlement he sells his license in the open market. Currently the rate for these licenses is approximately Rs.10, 000 - Rs.11, 000 per ton depending on the demand / availability. The floor price of imported marble (the minimum import price) should be not less than US$325 per ton c&f for blocks and US$500 per ton c&f for slabs. Marble manufacturers associations have made a representation to the licensing authorities to review the licensing regime.
RAJASTHAN’S SCENARIO OF MARBLE INDUSTRY Marble industry of Rajasthan is an important industry generating Rs. Rs. 5,55,178 # thousand approximately. However, it is mainly confined to Rajasthan with about 95% of national production segregated in the state. As a result much importance has not been attached to the industry and very few futuristic studies have been made. Even in the much acclaimed ‘Vision 2020’ by Honourable Shri A.P.J. Abdul Kalam there is no forecast about this industry. Seeing to the importance of this industry in the state, the studies are mainly based on two factors, (i) On the basis of regression equation based on the past performances of marble industry. (ii) Correlation with other related industries, the futuristic trends of which have already been determined. In addition to these important factors parameters like population growth, per capita income, globalization and open economy, Government policies, discovery marble deposits in other states, environmental aspects, and natural hazards etc have also been given due cognizance.
SUPPLY OF MARBLE Rajasthan has been bestowed with huge reserves of marble. So far there is no problem as such of shortage of supply of marble in the state. Estimated reserves of the state are 1100 million tons, which are more than 91% of the total marble reserves of the country. The present hard times faced by the industry in the state are in fact a result of imbalance of demand and supply of marble in the market. Lured by the high profit margins of the trade, several entrepreneurs have entered in the industry. With the advent of modern technology in the past few decades, the production of marble has increased like any thing. The cost of production has come down and the speed and quality of production have improved a lot. Moreover, the reduction in wastage has also resulted in increased production. All this resulted in supply of huge surplus to the demand in the market.
DEMAND OF MARBLE It is a well known fact that marble now has become a thing of necessity, rather than a luxury. Marble has now become the cheapest and the best option for the flooring of the building constructions besides the other uses. Demand of marble has grown steadily in the past few decades, although the supply of marble in market is much more than the demand.
Table 10 gives the year wise production data of marble since 1950. Figure shows the chart on the basis of these figures. A trend line has been drawn on the basis of these figures and its equation has been derived to work out the future figures. In this chart the figure of 1950 and 1955 are not taken into consideration as at that time, the mining and processing activities were very crude and the demand of marble was very limited so the figure derived with those data might give misleading results. As is evident from the chart,
the industry is having an exponential growth rate. The impressive trend line shown in the graph is in fact a modest representation of the growth rate of the industry. If we draw a trend line on the basis of production figures of last 10 years, the trend line would be much steeper. Table 10: Year-wise Number of Leases, Production & Revenue of Marble in Rajasthan (1950 To 2000). S.No Year No. of leases Production in Revenue in ’000 Tone ’000 rupees Marble + green Q.L. marble 1. 1960 ___ ___ 17.620 117.880 2. 1965 ___ ___ 6.611 N/A. 3. 1970 16 ___ 30.300 N/A. 4. 1975 50 ___ 56.400 N/A. 5. 1980 66 ___ 63.420 679.600 6. 1985 216 ___ 139.000 127.300 7. 1990 ___ ___ 261.900 4955.100 8. 1995 ___ ___ 716.700 31696.800 9. 2000 3473 ___ 1514.600 117795.20 10. 2005 3775 798 3023.960 316700.000 11. 2010 3243 840 4278.630 555177.551 Apart from this change in the living styles and the preferences of common men are also instrumental in increasing the demand of marble in the past three decades.
FACTORS AFFECTING the DEMAND & SUPPLY OF MARBLE The studies indicate that the demand and supply of marble both have an increasing trend. But at present the demand of marble is much below the supply. The reasons which affect the demand and supply of marble in the country are explained here: Increased Production Due to advent of sophisticated mining machinery and development of new mining fields marble production has increased manifolds. The biggest role in this has been played by the invention of wire saw & chain saw for marble mining and diamond gang saw for the processing. To bring down the cost per ton of production, most of the big mine owners followed the principle of increasing the production. As a result markets were flooded with marble and there were few takers. This is one of the most important reasons behind the present imbalance between the demand and supply of marble in the market. Moreover some new deposits of marble have been discovered. Earlier in Rajasthan there were only two marble producing regions, i.e. Makarana and Ambaji, but now 20 districts of the state are producing marble. As supply of marble kept on increasing the prices were forced to come down. Decrease in growth rate of construction activities. There has been a global reduction in the growth rate of construction activities since last few years. Marble industry has its sole dependence on the construction industry. The production of marble has increased in the past few years (Figure) and the construction activities too have increased. The core of the problem is that rate of growth of marble production is having an increasing trend whereas the growth rate of construction activities world over is having a declining trend. So the supply of marble is much more than what is required. Overall Global Recession Faced by the World Economy The whole world economy is facing the recessionary trend since past few years. This has affected most of the industries, but the commodities of necessity. As marble is not an essential commodity, marble and related industries have faced a decrease in demand due to decreased purchasing power of consumers. This phenomena is not limited to India but is evident the world over. Experts are of the opinion that the world economy is right now going through the troughs of the trade cycles. International Disturbances Major disturbances in the world and especially in the Indian subcontinent have attributed to decrease in exports of marble from India. Following the growing tensions with the neighbouring countries, India has to give due cognisance to its militia and defence. Steps taken by the Government of India to prove its military strength have not been taken very
well by the developed nations of the west. This has imparted temporary effect on the overall exports from the country. The September 11, 2001 attacks on World Trade Centre, in New-York City have also impelled the authority’s world over, to rethink about the constructions of high rise buildings. Since then, there has been down fall in building construction activities in western countries. Other Marble Producing Nations This is yet another reason for decreased exports from India. Other countries like China, Italy, Greece, Spain etc. are not only producing good quality of marble, but they have shelved their prices too, in the past few years. There is much hype in the trade circles that with the ingress of ‘Global Agreement on Trade and Tariff’ (GATT) and “World Trade Organisation’ (WTO) the entry of the imported marble in the country will adversely affect the marble industry of the state. But in fact the systems are going to help the marble industry of the state rather than harming it.
There are many reasons, which ensure that the imported marble can not compete with the Indian varieties on the price front. So largest sector of Indian buyers that is the middle class of the country will remain a safe market for the Indian producer. In America largest numbers of anti dumping charges after China are against Indian companies. So the western countries are more afraid of prices of our products than we are of theirs.
These systems will increase the market of our market. Every one do agrees that marble varieties of Rajasthan are world class and some of them are unique to Rajasthan only. Dimension stones being of natural occurrence are available at very few places in the world. At many countries even if marble deposits are available these are not being mined either due to lack of infrastructure facilities, lack of capital in the underdeveloped nations or due to environmental over awareness, giving no cognisance to such industries in the developed nations. So WTO and GATT are going to help the Dimension stones industry of India very much if not to the other industries. More over, as a sequel to that Indian Dimension stones processing industry will get more work as than they can process marble from some countries and resale it to other countries. China is doing this practice since past many years and has been highly benefited from it. Along with easier import of foreign goods in the Indian market, these schemes also ensure similarly easy export of Indian goods to foreign markets. So the tempo created in the industry about the repercussions of these schemes is a short-sighted interpretation of these. Liking of the customers: It is a fact that the liking of the customers for stone cladding has increased dramatically in the past three decades. Main reasons behind this are heavy production of Dimension stones making availability of these much easier and affordable. Mechanization has been instrumental in the development of this industry in the world over. Now the time and the cost involved in the final production of marble has been considerably reduced. As a result marble has entered in the middle class sector of the country. Now marble is the cheapest and the most suitable option for flooring of the residential and official constructions. Though in the states farther from Rajasthan it may not be the cheapest option on account of transportation charges, but still it enjoys supremacy over other options for flooring. Reasons behind the increasing popularity of marble •
Low cost: Now marble has emerged as a very cheap option for the flooring purposes. Earlier it used to be a leisurely thing which could be afforded by only few, now it holds the twin advantage of catering the needs of both cost conscious as well as elite customers seeking exclusivity. Moreover the cost of the competing Dimension stone i.e. granite is much higher than marble and good ceramic tiles are also costlier and less durable than marble, this point also goes in favor of the marble industry.
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Beautiful looks: “A thing of beauty is joy for ever”, the saying stands true for marble too. Whether its flooring or the elevation marble looks good. Availability in huge variety of colors, shades and designs increase the beauty of marble all the more. Marble does not suffer the problem of monotony, which is one of the major drawbacks with the applications of granite and the ceramic tiles.
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Longevity: Generally used Dimension stones for the purpose of flooring and elevations are marble, granite, sandstone and slate. Of these only marble and granite can be applied on the flooring as the other two are porous. Both these natural stones are long lasting. This is one of the big advantages of these over other Dimension stones and ceramic tiles. In fact the longevity of granite is much more than marble but the historical monuments made of marble are good evidence that the longevity of marble is also well enough more than one expects.
Competition from the Marble of Other States There is going to be some competition to the Rajasthan marble mining and processing industry with the development of marble industry in the other states. But seeing to the quantum of the reserves of other marble producing states viz. Gujarat, Madhya Pradesh and Karnataka such worries appear irrelevant. Though these states are more centrally located in the country having cheaper approach to the different parts of the country, but each of these marble mining centers are having limited varieties of marble. The processing industries of these places have to look ultimately towards Rajasthan for catering to their needs to keep them in running conditions. Moreover entrepreneurs doing them business in these sates are mainly of Rajasthan origin only. So in fact development of marble industry in the other states will increase the demand of marble blocks from Rajasthan.
IMPACT OF GOVERNMENT POLICIES ON INDUSTRY Recently, Government has introduced many new laws pertaining to the proper and sustainable development of marble industry, and these are well received by the persons related to the industry. Removal of Excise duty: One of the major changes that the Government has introduced is the removal of the excise duty on marble (upto the annual sales of Rs.1 Crore). This is a major step as so far marble was the only mineral product in the country on which excise was imposed. The removal of the excise duty will reduce the landed cost of marble to the end user and this will surely increase the demand of marble in the market. New marble policy: The new policy for the marble mining will facilitate the search of new marble areas in the state. The new policy not only allows the grant of mining lease for marble in the state but also permits the prospecting work for the search of new areas of marble deposits. In total it can be said that the Government had realized the importance of this industry and now seems to be committed towards the development of the industry.
IMPACT OF INTERNATIONAL EVENTS ON MARBLE INDUSTRY OF RAJASTHAN Marble industry of Rajasthan depends a lot on the export market. The series of recent events throughout the world have affected the Indian exports of marble. It started with the nuclear tests conducted by the Government of India in 1999. In response to theses tests many of the western nations imposed sanctions on business relations with India. This effected most of the export oriented Indian industries. This was a major setback for the marble industry of Rajasthan as there was already a problem of surplus production. The industry was not able to recover from the impact of these sanctions when the September 11, 2001 terrorist attacks in United States worsened the situations even more. Rate of growth of Indian natural stone exports have decreased severely as a result of these events. At present the international community is quite hesitant to make deals with the concerns of the subcontinent seeing to the disturbances between India and Pakistan and possibility of conflict between the two nations. Besides these disturbances there is one more threat to the Indian stone industry, which is presented by China. In the recent years China has started exporting marble and other natural stones at very cheap prices and is capturing a large portion of the market. India being the largest producer of marble in the world and fifth largest exporter has its domestic market quite safe but the international market of Indian marble has been severely affected by the Chinese market policies. IMPACT OF RECESSION ON RAJASTHAN’S MARBLE INDUSTRY The ongoing recession has bruised the real estate sector and the marble industry of Rajasthan. Kishangarh, which was a leading town in marble processing till recently, has been forced to bear the brunt of recession. Hundreds of marble miners and processors here have been affected by stagnancy. According to the Kishangarh Marble Industry Association, the downward trend has resulted in sales falling by 10-15 per cent. Quarry owners and processors of marbles, granites and other stones fear that the global recession can drastically affect their business. The marble industry in Kishangarh witnessed growth rate of five per cent prior to the global recession. Around 4,000 people are directly employed in it while another 15,000 persons are engaged in downstream activities of marble industry. Over the past couple of years major processors in Kishangarh had also taken up branding of their products.
INFERENCE & RECOMMENDATIONS INFERENCE On the basis of all the points projected above, it is assessed that the industry has developed itself in a very good manner, especially in the past few years. The present harsh time faced by the industry are due to the increased supply which is quite natural phenomenon for any developing industry and some other unnatural factors which are of short term nature. 1. Production of marble has increased a lot in the past few years and this trend will continue, 2. The demand of marble will further increase as a result of decreased prices. 3. The exorbitant profit margins enjoyed by the producers and the traders will decrease and the prices of marble will become more regularized. On the basis of the data discussed in this paper it is prognosticated that the industry will surely grow in the times to come but it is expected to grow in a centralized manner. Heavy mechanization will largely prevail. Though new areas have been discovered in Madhya Pradesh and Gujarat but it will take those years to catch up with marble industry of Rajasthan as the Mundies for marble are in Rajasthan only. The prices of marble are expected to further go down with the increased competition and as the cost of production are expected to come further down in future. The total production of marble is expected to increase at the rate of 12% per annum or more and the exports of marble and products thereof from the country are expected to increase at around 20% per annum. Domestic consumption of marble in the country is prognosticated to increase at the rate of around 10% per annum. At international level the future of Rajasthan marble industry seems to be promising. Many of the famous mines of Europe have already exhausted. China presents a tough competition, as it too has vast marble producing areas, developed processing industry and very competitive prices but the quality and colour of marble from China are not very appealing. Moreover, construction activities in China have almost reached to their saturation, but the urbanization of India has in fact just started, which provides a huge scope of domestic consumption. Under the given set of circumstances, India is expected to dominate the marble industry in the world, with Rajasthan to be the hub of activities. On the basis of the studies made in the paper we can infer that marble industry of the state is shaving a bright future, and will keep on growing in spite of all odds. The industry will rule over the world with increased production of good quality marble, decreased production cost and increased exports.
RECOMMENDATIONS •
In general, the marble industry in Rajasthan has a good potential to prosper and to be one of the driving forces for the country's overall economic well-being especially as natural resources abound. Regulating this important resource of the country is mandatory for sustainable development.
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Moreover, improving the quality of the final product is key to invading the international markets and establishing a reputation in this field. High profitability could lead to further market entry which may prove to attract more efficient production technology.
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This might lead to market segmentation, where value-driven and export-oriented firms will tend towards an oligopoly, whereas local-oriented cost-driven firms with relatively low technology will tend towards monopolistic competition.
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In all cases, to achieve a more competitive marble industry in Rajasthan in the long-run, effective government regulation is essential.
REFERENCES •
Marble Institute of America (MIA), website: http://www.marbleinstitute.com.
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"Marble & Granite" In SMEDA. (
[email protected]). 12 July 2002.
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Stone 2000, cited in marbleandmore.com (online reference material).
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“World Stone Industries: Leading Quarrying Production”, In.marmoealtro.it/econ/quarrypro.asp.
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