India's construction equipment sector needs to cut its ₹45,000 cr import bill: Kumaraswamy
India's construction equipment sector aims to reduce import reliance. A new government scheme will boost domestic manufacturing of critical components. This initiative seeks to strengthen local supply chains and cut import dependency. The industry anticipates significant growth by fiscal year 2029-30. Exports showed strong growth while domestic demand experienced a temporary dip.
India's construction equipment sector finds itself grappling with a substantial ₹45,000 crore import bill, according to Heavy Industries Minister H D Kumaraswamy. The minister emphasized the need for the domestic industry to reduce its reliance on foreign imports during his address at the Indian Construction Equipment Manufacturers Association's (ICEMA) annual session 2026.
India currently ranks as the world's third-largest player in the construction equipment manufacturing industry, trailing only behind China and the United States, with a market size of approximately Rs 97,500 crore in fiscal 2024-25. However, a significant portion of this market - around Rs 45,000 crore - is heavily dependent on imports.
In a bid to bolster the domestic industry and lower the import dependence, the Budget 2026-27 has unveiled a scheme aimed at fostering the production of critical equipment and components. This move is expected to "strengthen the domestic supply chain and reduce excessive dependency on imports," Kumaraswamy asserted.
The minister further disclosed that inter-ministerial consultations are underway, with the scheme set to be approved in the near future. The construction equipment industry is projected to grow, with its market size anticipated to reach around Rs 2,28,000 crore by fiscal 2029-30, according to Kumaraswamy's projections.
The Indian construction equipment manufacturers association reported a slight slowdown in fiscal year 2026 (FY26), with total equipment sales dropping by roughly 2% to 1,36,995 units, primarily due to a 7% decline in domestic demand as infrastructure execution slowed. However, exports experienced a strong 32% growth over the same period.
ICEMA anticipates a resurgence in industry growth for fiscal year 2027 (FY27), driven by the government's continued support through a public capital expenditure of Rs 12.2 lakh crore, faster project execution, and the implementation of the construction equipment manufacturing scheme.
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