The Hannover Industrial Fair was inaugurated jointly by PM Manmohan Singh and the German chancellor, Angela Merkel on April 24.
It has brought together over 5,200 of the world's largest manufacturing companies.
About 370 Indian companies are likely to take part including heavy weights like Bharat Forge, Reliance and Ashok Leyland, along with five State Governments.
The fair has three themes this year, India, automation and energy, said Stephan Kohler, VP of Deutsche Emerie-Argentur.
Many German companies want India to be having a sub-contracting, R&D and manufacturing base. This is the reason a big support was received to have India as partner country for Hannover Messe this year, said Wolfgang Pech, MD of the company.
Labour shortage and associated costs hike up European companies cost of operations, and Germany, cradle of European engineering is no exception to it.
But along with skilled labour and cheap ancillary industry, there is another deeper reason for European industry to choose India, over China.
Many European companies have intellectual property rights problem in China, said Mr Pech.
An India Brand Equity Foundation (IBEF) survey of leading 30 German companies who set up base in India shows that almost all plan to increase their operations.
This includes Suspa Pneumatics, Knorr Bremse and Baumuller KAT. German companies are also looking to set up R&D centres in India.
Carl Zeiss' decision to start operations in India was influenced by India's capabilities in high tech research.
Demand for energy is increasing as emerging giant economies like India and China industrialise.
Markets that are technology-oriented are needed to achieve higher efficiency and lower energy consumption levels.
marketing@alchempro.com
