Today, more than 60% of the CE industry’s products are ~80% indigenized.

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President

ICEMA & Managing Director, Volvo CE India

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Dimitrov Krishnan, President, ICEMA & Managing Director, Volvo CE India

How is the Indian CE industry responding to Make-in-India programme?

The Indian CE industry is constantly striving to align with the Government’s Make-in-India programme by bolstering local manufacturing of components, resulting in higher domestic value addition. The indigenisation level in the industry has improved over the years, and today more than 60% of the CE industry’s products are ~80% indigenised, and around 30% products are nearly 50% indigenised. As part of the its vision 2030, the industry is working towards further enhancing the current indigenisation level to 70%. A dedicated PLI scheme for the CE industry could act as a strong facilitator towards this direction.

What are the challenges and suggestions for the construction equipment industry in terms of the ‘Make in India’ initiatives?

The Indian Construction Equipment (CE) industry continues to remain dependent on import of certain precision components like, hydraulic components, undercarriage and electrical & electronics, along with some fully-built machines not manufactured in India. This restricts industry’s alignment with the Govt’s Make in India initiative. Moreover, the industry expects its current market size to grow from USD 6.5 Bn to USD 25 Bn by 2030. Therefore, there is a need to enhance the capability as well as the capacity of the industry to meet the growing demand and simultaneously reduce its import dependence. The Government’s support in the form of a dedicated Performance Linked Incentives (PLIs) for the CE industry can play an instrumental role in attracting investments as well as the latest technologies through global manufacturers who currently do not have a footprint in India. This will help drive indigenization and competitiveness of the CE industry.

How do you look at the performance of the construction equipment industry in the coming quarters?

The Indian Construction Equipment (CE) industry recorded its strong performance in FY2022-23 by registering an excellent 26% growth with sales crossing the one lakh unit mark. Going forward, we anticipate well-distributed and reasonably predictable markets in the forthcoming quarters, as well as Government’s continued support in the form of policy reforms and incentives to sustain this growth. Additionally, the Government’s continued emphasis on infrastructure development, buttressed by increased capital expenditure announced in the Union Budget 2023, will contribute to sustain the growth trend in FY2023-24, and there could be an increase in the market size by 15-20% during the year.

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