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Building bridges

THE enormous size of the Indian market was a main factor in attracting JV International to explore export opportunities in that country.

And the effort has paid off, with the company recently signing a multi-million dollar deal with a major Indian construction and engineering firm.

Como-based manufacturing firm JV International established subsidiary JV Global to service the deal, which was hoped would result in the company producing 100,000 steel door and window frames to a capacity of 280,000 frames a year within three years.

JV International managing director Terry Opie said the company began exploring opportunities in the Indian market seven years ago when he visited India to speak with potential Indian partners.

Then, in November 2002, after several years of ground work, JV Global signed a deal with leading Indian construction company Larsen and Toubro.

Larsen and Toubro is one of the largest building conglomerates in India and has extensive interest and experience in South Asia and the Middle East markets.

Mr Opie said the WA trade office in Chennai was instrumental in closing the deal and that State Development Minister Clive Brown was also present at the signing in India.

Mr Opie said the advantages of establishing operations in India, over alternatives such as China, were the low labour costs, the prevalence of spoken English , and existence of a well established legal system similar to that in Australia.

He said the company had found a niche opportunity in India.

“In India, traditional building products used to be wood, however there has been a decline in available wood and what wood is available is becoming very expensive. Coupled with government restrictions, wood product is being superseded by steel,” Mr Opie said.

 “We are initially starting with steel door and window frames for India and other export markets, such as Sri Lanka and the Middle East.

“We will then look at producing a range of other steel building products such as steel roofing trusses, steel framing and guard rails for low cost housing and steel purlins [heavy beams] for commercial buildings.

“We have also been appointed to act as an office to look for strategic alliances for large building and construction projects, especially on the North West Shelf.”

Mr Opie refused to be drawn on the potential opportunities or revenue that the company anticipates would result from the deal with Larson and Toubro.

“It will be substantial and I can’t quantify the revenue that it will bring in, other than to say, it is too early and it will depend on the growth,” he said.

 

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