The development will help India achieve its aim of becoming the third largest construction equipment maker in the world after China and the US.
20 Sep 2023 | 7112 Views | By Shahkar Abidi
New tenders worth approximately Rs 2 lakh crore are either in the process of being finalised or nearing completion for a range of road projects and motorways in the next few months, according to Sanjay Saxena, COO of Sany India and South Asia. This amount is more than enough to ...
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New tenders worth approximately Rs 2 lakh crore are either in the process of being finalised or nearing completion for a range of road projects and motorways in the next few months, according to Sanjay Saxena, COO of Sany India and South Asia. This amount is more than enough to give a further boost to the construction equipment industry for the next few years, he told Autocar Professional.
According to Saxena, the demand for construction equipment is expected to be very robust in the next five to seven years, due to the expected growth in capex (capital expenditure) of around 11–12% over the last few years until 2026–2027.
The development, he claims, will help India achieve its aim of becoming the third largest construction equipment maker in the world after China and the US, in the coming years. The government earlier announced projects like Gati-Shakti, Bharatmala, coastal roads, or Mumbai Trans Harbour Link (MTHL), which has given a very good boost to the construction equipment market demand," explained the top executive. The MTHL project plans to connect Mumbai to Navi Mumbai across the Arabian Sea at a cost expected to be around US $3.5 billion.
Saxena further expects demand for construction equipment to remain high over the next four to five months, driven by the festive season. This would help the industry make up for lost sales in July and August due to extended rains, he added. He expects the industry to do the same level of business in the next four months as it did in the previous eight months.
Saxena's remarks come against the backdrop of a recent report by Nuvama Research, suggesting the road projects awarded for the year-to-date period of FY24 witnessed a decline of 35% year-on-year (YoY), standing at 1,756 kilometres. In contrast, road construction jumped notably to 3.196 kilometres, which is an increase of 10% YoY during the same comparable periods.
Talking about the demand from mining and ports, which are other dominant areas of the infrastructure network, Saxena reveals that for mining, the demand for machinery and equipment is expected to increase because the government plans to double coal mining capacity by 2030. Private mining contracts and government expansion are also fuelling the demand for large excavators and other mining machines. Secondly, in the case of ports, the company has already introduced hybrid and fully electric port machinery, like wheel stackers and container handlers. In the next 2-3 years, 80% of new container handlers will be fully electric, and the other 20% will be hybrid. Port machinery is used to move cargo on and off ships.
Plans to double capacity, increase exports
Saxena further highlighted that Sany India is planning to expand its current manufacturing plant quite heavily in the coming two years by putting up additional infrastructure and capacity. According to him, the aim is to increase production capacity at the plant from the current 500 units per month to around 1000 units per month, which is a 100% increase. Some of this additional production would be geared towards exports as well.