Press Trust of India
Bangalore, Nov 24: Poised to play a larger role in ‘Make In India’ initiative of the Narendra Modi government, the domestic construction equipment industry has a potential to grow about two-fold to USD 5 billion by 2020.
“The domestic construction industry is set to become a driving force in ‘Make in India’ initiative. From a USD 2.8 billion industry at present it has the capacity to grow to over USD 5 billion by 2020 on the back of infrastructure growth which is bound to take place under the present regime”, CII senior executive and EXCON Chairman Vipin Sondhi told PTI.
EXCON is the international construction equipment and technology trade fair beginning here tomorrow that will see participation from about 800 companies from 22 countries. It is South Asia’s largest construction equipment and technology trade fair.
The latest data available with the industry show the slowdown earlier has resulted in conservative projection for construction industry to USD 5 billion in the next five years but it is bound to grow exponentially post 2020 on the back of slew of steps by the current government.
Previous reports had projected USD 20 billion growth for the industry by 2022 but three years of de-growth had led to revised USD 5 billion projection, Sondhi, who is also JCB India MD & CEO, said.
Sondhi said de-growth has stopped and amid the proactive measures by the government, especially in the highways sector, the industry is set to grow manifold and bound to bolster economic growth.
“There is much optimism in the industry. A lot of initiatives have been taken in the highways sector with several key policy measures to roll out stuck projects and there is a need to replicate it across various segments”, Sondhi said. With stranded projects now making a move in the sector, the industry is hopeful of similar steps in other areas, Sondhi said adding measures were needed to address the bottlenecks faced by projects at the centre as well as states.
“Corrective measures and industry friendly policies of the Government would greatly help for the infrastructure development in the country. Infrastructure growth holds the key to the construction equipment industry realising its potential in India”, Sondhi said.
He also suggested that the government could set up a Land Bank Corporation by utilising the land available with Railways, Defence, Ports, PSUs etc.
“The industry believes that if the government offers projects with necessary clearances and other due diligence, not only the players would benefit but the country at large would tremendously benefit as India has huge growth opportunities unlike China, Brazil, Russia and Europe”, he said.
In the 12th Five Year Plan, the Government has earmarked approximately USD 1 trillion for infrastructure investment.
“Consequently, infrastructure spending is expected to grow from 7.2 per cent of GDP in 2012 to 9 per cent by 2017. This is likely to spur the demand for ECE, and if the industry’s full potential is realised, the total turnover of the industry could reach more than USD 5 billion by 2020”, he said.
