India’s construction equipment (CE) industry is projected to grow at a compound annual growth rate (CAGR) of 12 %, reaching $25 billion by 2030, driven by the government’s focus on expanding the infrastructure sector, according to a report by the Indian Construction Equipment Manufacturers Association (ICEMA).

Currently the world’s third-largest market for construction equipment, India’s CE industry is valued at approximately $10 billion (FY24). The industry has significant potential to become a global manufacturing and export hub, as noted by ICEMA.

"As a result of current infrastructure investments announced in India, the CE industry is expected to reach $25 billion in FY30, posting a CAGR of 12 % with an envisaged investment in the industry value chain of around $4 billion. This includes approximately $1 billion in manufacturing by OEMs over the next five years and 3X investment (around $3 billion) by suppliers, component manufacturers, and distribution channels," ICEMA stated in its report, "2035 Construction Equipment Market Outlook for India," with Deloitte as the knowledge partner.

India’s CE market includes more than 50 OEM manufacturers and provides employment to over 3 million people, both directly and indirectly. The country's construction equipment trade with the world is valued at around $3 billion, with imports accounting for $2.6 billion and exports around $500 million.

“By FY35, the CE industry is expected to reach $37 billion. However, with the commencement of the government’s ambitious Amrit Kaal vision to make India an economic and manufacturing hub through long-term infrastructure investments, the CE industry could grow at a faster rate to achieve a market size of $42 billion in FY35,” the report noted.

The expanding infrastructure investments and goals to make India a manufacturing hub are set to enhance the CE industry’s focus on exports. Currently, India's CE exports are worth about $0.7 billion, comprising 0.4% of the global CE market. This is projected to grow to $3 billion by 2030, representing 1.2% of the global market.

Earthmoving equipment is the dominant segment, holding a 72% share in FY23 and expected to increase to 81% by FY35. This is followed by concrete and material handling, with shares of 11% in FY23 and 6% in FY35, respectively. The smallest segments are road construction and material processing, with shares of 4% and 2% in FY23, and 6% and 1% in FY35, respectively, the report concluded.

(Source: Businessline)