Continental Engineering Corporation
First India, then the World
The blazing hot Indian construction market has become the starting line in one Taiwanese company’s race toward a global presence.
First India, then the WorldBy Hsiao-Wen Wang
From CommonWealth Magazine (vol. 391 )
Nita Ing harbors an unfulfilled wish about India. 'I should have taken a half year and lived in India six years ago,' the Continental Engineering Corporation chairman admits in an exclusive interview with CommonWealth Magazine from her office on downtown Taipei's Dunhua South Road. Normally elegant and composed, excitement creeps into her voice at the mention of India.
Looking out from the full-length windows of Ing's office, one gets a bird's-eye view of high-rises clustered together and the traffic buzzing on the streets. But to Nita Ing the picture below shows the 'limited growth potential' of Taiwan's construction market.
Energy-packed Construction Market
The view from the full-length office windows of CEC international managing director John Porter, in the Delhi satellite city of Gurgaon, tells a different story, as one after another glass-skinned high-rise leaps out of the dusty yellow earth in the vicinity. The dust is so thick it blocks out the blue Indian sky, yet it cannot obscure Nita Ing's vision. This is the Indian construction market Ing is so keen to be a part of.
India's construction market is like a newborn baby, its power the force of growth. The Indian government projects 15 percent annual growth in the construction industry over the next decade.
Since management consulting firm McKinsey & Company helped CEC map out a strategic plan six years ago, CEC's strides into India have been long and swift. Continental is said to have contracted for nine national highway and rapid transit system projects, already achieving a scale on par with its contracting in Taiwan.
Over the next five years, CEC stands to take in US$500 million. This year alone, its Indian operations will generate revenues of US$150 million, accounting for approximately 34 percent of the company's total revenues.
Continental Engineering is a trailblazer among Taiwanese construction firms making the passage to India, but for the company India holds the larger significance of serving as an initial proving ground in its march toward a global presence.
In Mundka, to the northwest of Delhi, the gray tunnel lining, made up of multiple circular segments, appears positively genteel in contrast to the bleak surroundings. The massive tunnel boring machine stands alone, out of place like some intergalactic ship. 'This is our most precious weapon,' says project manager Jeff Lan, patting the machine affectionately.
Tunnel lining segments, tunnel boring machines, Indian workers... the picture tells the story of CEC's first foray abroad to build a rapid transit system. For Continental Engineering, Delhi's DC 16 subway line, running eight kilometers round-trip, is more than just an express ride on the soaring Indian economy ?V it marks the starting point in CEC's race onto the world stage.
'Indeed, all you see here is opportunities,' Porter asserts with a sweep of the hand, pointing out his office window at a building being constructed by DLF, India's biggest real estate developer.
The biggest business potential comes from major contracts handed out by the government. Keen on development, the government has mapped out an ambitious plan to attract US$150 billion in foreign investment in its infrastructure over the next decade. This year it has allocated 100 billion rupees for the Golden Quadrilateral express highway project linking Delhi, Mumbai, Calcutta, and Chennai.
Yet when Porter fixes his gaze on the workers moving slowly down below, looking like ants from this distance, he is compelled to state, 'Look at these workers. They earn only 123 rupees a month. How do you expect them to understand the 'quality' you are talking about'?
Daily Rollercoaster Ride
'Everyday, it's like riding a rollercoaster,' Porter declares in his unmistakable British accent. A veteran of 40 years in the construction industry, he frankly admits that India is the toughest market he has ever encountered.
Construction delays, Indian executives trebling their salaries every year, and poor construction skills all give Porter constant headaches. But a call the previous day from Reliance Energy, India's largest conglomerate, inviting CEC to take part in a power plant construction project, seems to have made him feel it has all been worthwhile.
'Don't forget that India has a lot of highly influential major corporations,' reminds Nita Ing. 'We need to learn how to find our own position in major investment projects, so that in the future we can move into other overseas markets armed with these skills,' she says.
Looking ahead, Nita Ing will no longer be satisfied with just being a Taiwanese contractor. India has given her the chance to introduce an international operations team and learn new risk management approaches, and it has given her an expanded playing field.
Looming over major intersections all over Delhi, an endless series of huge billboards for mutual funds promise that basic infrastructure development projects are set to transform India. CEC is working night and day to carve out a new face for the city. But for Nita Ing, perhaps the bigger issue is how India will transform Continental Engineering.
Translated from the Chinese by David Toman
Chinese Version: 從印度追上世界