Demand for Construction Equipment Increasing with Development
The growth of the construction equipment industry is directly proportional to the growth of infrastructure in a country. The construction equipment companies in India was faced with a gradual slow down and an eventual slump in the past few years due to various reasons. Few reasons for the same were a slow down in the infrastructure industry and various government policies that with restricting the growth of the industry.
The Modi government in the past 2 years has made signifiant changes in its policy and spending across sectors. The focus has shifted to developing infrastructure for bot residential and commercial purposes. Projects that were previously stuck in government offices have been restarted to kick start development of infrastructure in the country.
Keeping the recent policy and budget announcements in mind, the ICEMA (Indian Construction Equipment Management Association) has predicted that the construction equipment industry in India will grow almost double in size to US $5 Billion from the current US $2.8 Billion. The government has finally passed, approved and restarted projects worth 4 lakh crores adding to fuel to the fire of growth.
Infrastructure is one of the key drivers for the bull run of India’s economy. The government has finally realised it and has substantially increased spending on infrastructure to create a suitable environment for various industries and rural development. Out of the INR 31 Trillion required to be spent on infrastructure in India over a period of the next 5 years, 70% of it is required for power, roads and urban infrastructure segment.
Various projects like development of ports require development of infrastructure of amenities on the ports and of roads connecting the ports to various parts of the country. Similarly power is another sector that requires a growth in infrastructure to ensure a uniform power supply across the country. Keeping the urgent need for infrastructure in mind, the projects are put on steroids for timely completion to create it.
Roads are another major sector that has received major funding and approvals for development. Construction of industrial corridors for easier movement of goods across the nation require a substantial investment of man and machine over an extended period of time there by giving the construction equipment industry the much needed boost.
The over all growth and development of a nation’s economy eventually depends on the strength of its infrastructure. Given the state of things in India, the sector is in for a huge run of upward growth of infrastructure across various fields be it power, roads, railways, industrial corridors and zones, farming, irrigation etc. Growth of these individual sectors is highly dependent on the growth of favourable infrastructure and the growth of infrastructure is fundamentally dependent on the construction equipment industry, barring which the whole plan for growth fails at the very foundation.
So yes, keeping in mind that construction equipment are a fundamental necessity for development of infrastructure, it is safe to say that the demand for construction equipment is increasing and will keep on increasing with development.