The Indian business of blowing things up is booming
THOSE WHO want to gauge India’s economic prospects often look to businesses that erect homes, produce consumer staples, manufacture inexpensive vehicles and provide basic services like electricity or discretionary ones like travel. Each of these sectors is currently sending mixed messages—enough good news to justify hope, but with caveats that counsel caution. One industry, though, is sending an unequivocal signal. And a loud one.
Since April the share price of Premier Explosives has more than doubled. That of a larger maker of things that go boom, Solar Industries, has quadrupled since 2021. Other dynamite producers are enjoying a similar streak. Besides being a gift to pun-lovers, this explosive growth reflects changes in an industry well placed to capture everything that is going right for India’s economy.
India began producing explosives in the 1940s, around the time it gained independence from Britain. Most of the engineers and technology came from Imperial Chemical Industries, a British concern. Coal India, a state-owned miner at the heart of both domestic energy production and industrial development, has long been the biggest customer. Because its mines are spread throughout India, and because transporting old types of explosive over long distances used to be best avoided, separate companies were created to serve Coal India’s individual sites. That geographical dispersion was preserved as other customers emerged, leading to a fragmented market. Today India boasts 36 large explosives producers.
2023-10-05 07:47:55
Original from www.economist.com
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