Italian machine tool makers seek Govt. support

By R. Gopalakrishnan

MILAN (Italy), OCT. 4. Italian manufacturers of machinery and machine tools have sought policy support from the government to ensure that the surge of Italy to the third position in global production and exports in these sectors last year does not remain a freak event but is consolidated into a firm long-term trend.

The President of the Italian Machine Tools, Robots and Automation (Ucimu-Sistemi per Produrre), Mr. Andrea Riello, in his address to the opening ceremony of the 22nd BI-MU/SFORTEC Fair in Milan on October 3, sought to draw inspiration from the U.S. record in sustained growth rate by relying upon knowledge-led industries and shedding traditional lines of production dominated by low- cost labour.

Of course, a repeat of the American strategy involving inflow of talent from around the world and huge trade deficit abroad, would simply not be possible in Europe, which has a strong tradition of a role for labour, welfare system and co-determination. Showing awareness of this, Mr. Riello said, ``There aren't many in Europe who would be willing to replace their social institutions with American ones, and perhaps it is not even possible. However, it seems quite possible for Europe and Italy to reproduce the driving force behind America's growth - an increase in productivity.''

Highlighting the increased global participation in the biannual fair (in which, however, Indian participation by way of exhibition is less than symbolic), Mr. Riello said it was ``amazing'' that the Italian machine tool was produced almost exclusively by medium and small companies which, due to their size, were more subject to the lack of flexibility inherent to Italy's labour system ``and to all the burdens that bureaucracy imposes on them.''

He suggested to the two representatives of the Italian government participating in the inaugural ceremony the following measures: (1) Promote incentives for R & D undertaken by companies, for example, liberalise the depreciation of innovative systems adopted by user industries; (2) launch a national programme of research and training on digital production systems with participation by companies; (3) strengthen the labour market by increasing its flexibility and reducing the burden of taxes and contributions that weighs on it; (4) allow mergers, acquisitions and bundlings under a system of fiscal impartiality, and (5) promote the development of market participants that are qualified to share the risk capital of small and medium companies.

The charter of demands put forth by the Italian machine tool industry has obviously much in common with suggestions emanating from sections of SMEs (small and medium enterprises) in India, particularly in the wake of tariff reductions and removal of quantitative restrictions on imports. Mr. Riello made it clear that he was not asking for ``subsidies''. ``We do not want to contribute to the mass of transfers'' for which the European Commission was coming down heavily on Italy.

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