As the world's most populous country, India's economy has maintained a strong growth rate in 2023, with a year-on-year GDP growth of 7.6% in the third quarter, far exceeding market expectations, and leading among major economies. This trend has also extended to the more segmented field of construction machinery.
According to data from the Indian Construction Equipment Manufacturers Association (ICEMA), a total of 107779 units of equipment were sold in the Indian construction machinery market during the fiscal year 2022-2023 (April 1, 2022 to March 31, 2023), a year-on-year increase of 26%, which is 10% higher than pre pandemic levels and reaching a historical peak.
In terms of product segmentation, the best-selling earthwork equipment in the Indian market in the fiscal year 2023 sold a total of 77164 units, a year-on-year increase of 23%. Excavators, loaders, and crawler excavators, which account for over 90% of the total sales of earthwork equipment, saw annual sales growth of 28% and 17%, respectively. Such achievements have made the world's third-largest construction machinery market, second only to China and the United States, more confident and ambitious.
"India is expected to become a global leader in the construction machinery and equipment manufacturing industry before 2028." Indian Minister of Road Transport and Highways Nitin Gadkari showed global construction machinery manufacturers his "ambition" to compete in the global market at the India International Construction Machinery and Technology Exhibition (EXCON) held in the southern Indian city of Bangalore on December 12.
In fact, the ambition of the Indian construction machinery market is not unreasonable. From the global market perspective, demand in most regions is currently weakening. Taking the Chinese market as an example, from January to November 2023, the total sales of excavators in the Chinese market were 178320 units, a year-on-year decrease of 27%; The total sales of loaders were 94494 units, a year-on-year decrease of nearly 18%. The sluggish growth rate for several consecutive months has intensified the pessimistic expectations of many industry insiders about the prosperity of China's construction machinery industry.
In contrast, the demand in the Indian market has not yet weakened, and so far, the growth has been very strong - in the first quarter of the 2023-2024 fiscal year (April 1-June 30, 2023), the sales of construction machinery and equipment in India increased by 18% year-on-year, reaching 27244 units; In the second quarter of this fiscal year (July 1st to September 30th, 2023), equipment sales increased by 31% year-on-year, reaching 30078 units.
Industry experts have analyzed that the construction machinery industry in India is expected to surpass the historical high of the previous fiscal year this fiscal year. It is expected that by the end of fiscal year 2024, the total sales of construction machinery in India will reach 125000 to 130000 units, a year-on-year increase of over 20%.
The key driving factor for demand sustainability is the growth of overall infrastructure. The Indian government has done a lot of work on this point. According to the federal budget of India, capital investment expenditure on infrastructure in the fiscal year 2023-2024 will increase by 33%, reaching INR 100 trillion (approximately USD 122 billion), exceeding 3% of GDP and almost three times the expenditure in the fiscal year 2019-2020.
The budget also proposes the establishment of an Infrastructure Financing Secretariat to increase private investment in infrastructure
