As the geopolitical scenario continues to remain uncertain, industry associations like the Southern India Engineering Manufacturers Association (SIEMA) have suggested the Indian Government to consider relaxing the MSME payment norms on a temporary basis.
Mithun Ramdas, President, SIEMA stated in a press release that the association welcomes
the timely steps taken by the Union Government to maintain stability and normalcy in the country amid the current geopolitical uncertainties.
At the same time, SIEMA and fellow associations suggest targeted policy support measures, including a special working capital credit line, temporary relaxation in MSME payment norms, enhancement of working capital borrowing limits and waiver of safeguard duties on critical raw material to help industry manage the present global volatility.
SIEMA also expressed serious concern over the unprecedented rise in raw material prices over the past six months, which is placing severe stress on the MSME-driven pump manufacturing sector.
“Over the past year, copper prices have increased by more than 50%, rising from about ₹800-850 per kg to 21,200 per kg. Copper alone accounts for 25-30% of the material cost in several categories of pumps. At the same time, sharp increases in aluminum, steel, cast iron, polymers, cables and other key inputs have resulted in overall manufacturing cost escalation exceeding 20%, significantly eroding industry margins,” a press release said.
The association also warned that continued absorption of raw material inflation could push many pump manufacturers particularly MSMEs into an existential crisis.
To partly absorb these abnormal cost increases, manufacturers have already initiated a phased price revision of around 10% with reference to October 2025 price levels, to be implemented before 31 March 2026. Given the continuing volatility in metal prices and supply uncertainties, the situation now warrants a further minimum price increase of 7.5-10% effective from April 2026.
The association also reiterated that water pumps are primary agricultural machinery, essential for irrigation, groundwater management and rural livelihoods. In view of this, the industry has urged the Government to reduce GST on water pumps from 18% to 5%, to support farmers, sustain organised manufacturing and promote energy-efficient technologies.
