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Construction equipment mkt expected to be US$ 5 billion by 2019-20 in India

By Niranjan Mudholkar,

Added 27 November 2015

By 2018-19, the industry will get back to an output level of 70,000 units, says an ICEMA report.

A Vision 2020 report outlining the state of the Indian Construction Equipment (ICE) industry was released recently by Nitin Gadkari, Union Minister of Road Transport, Highways and Shipping.

The report prepared by the Indian Construction Equipment Manufacturers' Association (ICEMA), an affiliated body of Confederation of Indian Industry (CII), sets out the current demand and forecast for the industry till 2020 with projected market size for major equipment. It analyses the critical issues facing the industry and suggests a way forward on critical issues.

The key highlights include the following:

After four years of decline, the ICE industry is finally seeing some signs of growth in 2015-16. Its current size is USD 2.8 billion and is expected to grow to USD 5 billion by 2019-20. The After Sales Spares market is about USD 800 million and is a major source of income and employment opportunity for SSI manufacturers and service providers.

The recent progress in highway road building activity and coal mining auction augurs well for the future.

There is cautious optimism that by 2018-19, the industry will get back to an output level of 70,000 units that was achieved in 2011-12. The overcapacity built in earlier boom years is expected to be utilised before fresh investments are made.

Backhoe Loaders and Hydraulic excavators continue to dominate the Indian market accounting for over half the market.

Customer practices to use better technology equipment is changing, albeit slowly.

There are positive signs of adopting global practices with respect to equipment renting and leasing.

Direct employment in the sector is about 1 million. The sector impact on allied livelihoods and families is over 10 million.

(Continued on the next page)

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