Building India's Green Future: Sustainable Construction Equipment's Role

1. Building India's Green Future: The Role of Sustainable Construction Equipment As the Indian Construction Equipment industry rides the crest of its second consecutive landmark performance in 2023-24, the current market size of the industry stands at USD 9.5 billion, including both domestic and export markets. India’s construction sector is positioning itself at the forefront of sustainable construction and creation of resilient cities. With a large number of infrastructure projects in the pipeline or in execution stage, India's commitment to green buildings, renewable energy, and eco-friendly urban planning is driving a paradigm shift, with emphasis on global sustainability goals and construction workforce management. As a key enabler of the construction and infrastructure sector, the Indian Construction Equipment (CE) industry has already been witnessing unprecedented growth in demand across all equipment segments, resulting in two back-to-back record-breaking annual results. Given that Construction Equipment comprises 15-20% of the average construction and infrastructure project cost, the rapidly growing construction and infrastructure sector is expected to drive demand for the CE industry’s products in the coming years. With the construction landscape in India evolving rapidly to align with global imperatives such as reduced ecological footprint, enhanced jobsite safety and jobsite solutions based on increased automation and digitisation, the demand profile for Construction Equipment is evolving in tandem. In order to meet the rapidly transforming demand for Construction Equipment, the CE industry players are adopting the latest technologies and innovations, to produce machines with higher levels of efficiency, productivity, safety and sustainability. This process is being facilitated by adoption of the CE Technology Roadmap 2035, prepared by ICEMA. The Technology Roadmap is serving as a step-by-step guideline for CE manufacturers to embrace the three salient focus areas of Jobsite Safety, Jobsite Solutions, and Sustainability. The Indian CE industry is poised to emerge as the prime global manufacturing hub for Construction Equipment by the end of the decade. In this endeavour, quality of products on par with the global benchmarks is the foremost requirement for the industry. In this direction, the CE industry is pursuing a two-pronged strategy, viz., achieving global quality standards by adopting and deploying the latest state-of-the-art technologies and innovations on one hand, and approaching overseas partners to encourage manufacturing in India.

2. Another significant requirement is for OEMs to train the small component manufacturers in the MSME sector, to produce components commensurate with global quality standards. This is especially required in the case of component suppliers from Tier 2 and Tier 3 cities. The government’s initiative to create an enabling ecosystem for the MSME sector is expected to catalyse the required changes. Despite achieving a minimum 80% indigenisation level in case of more than 50% of CE products, the Indian CE industry is heavily dependent on import of high precision components. The industry’s high technology-enabled products and precision components, which will drive future trends, involve high technology aggregates and systems such as hydraulics, electronic controls, pumps, drives, engines, powertrain, undercarriage items etc., which are largely being imported at present. Considerable investment by the Indian manufacturers in the value chain is required to enable domestic production of these components. The Indian CE industry is intrinsically aligned with the Government’s Make in India initiative. ICEMA is proactively partnering with various global associations to attract global supply chain partners to set up manufacturing in India, to reduce our import dependence. The industry’s objective to become a global manufacturing and export hub for Construction Equipment also segues into the Make in India initiative, as embodied by the MHI mantra of ‘Local to Global’. These initiatives will go hand in hand with the government’s endeavours to strengthen the MSME sector on one hand and attract FDI and overseas manufacturers on the other. To cater to the evolving demand trends in Construction Equipment, the industry has adopted various measures to improve the sustainability and efficiency of machines as well as processes. There are high expectations from the Construction Equipment sector to enable the Indian economy to become carbon neutral. In this direction, a key role will be played by the equipment operated on alternate fuels, use of alternate materials, and measures to promote a circular economy. In order to reduce the Green House Gas emissions, OEMs have already developed Construction Equipment powered by alternate fuels such as Hydrogen, CNG, Bio- diesel and hybrid technologies. Further, electric-powered CEVs such as Back-hoe Loaders, Wheel Loaders, Pick & Carry Cranes, Compactors, Crawler Excavators and Dumpers have also been developed on fast track, by most of the OEMs. This would reduce the carbon footprint of the construction processes and make the industry more sustainable. Though the development cost and initial equipment cost are high, electric CEVs are getting popular in view of their inherent advantages over diesel-powered machines in terms of being more energy efficient and low-emission. As the construction industry transitions to smart production solutions and ecological responsibility, there is a growing demand for more productive and energy efficient machines. The new range of modern machinery equipped with smart technologies

3. such as GPS tracking, machine learning, and automated control systems allows for real-time monitoring of fuel consumption, machine performance, and energy efficiency. This data-driven approach helps in making better decisions on how to use equipment more efficiently, reducing waste and cutting down on fuel usage. On the other hand, recycled materials reduce the demand for raw materials, transportation costs and mining activities, while the use of alternate materials can make the machines cheaper, lighter and more energy efficient. As far as demand trends for specific equipment are concerned, there is an increasing trend away from large, heavy machinery towards user-friendly, smaller size and versatile equipment, for instance, mini excavators, which have recently exhibited an uptrend in demand. With the emerging demand in sectors such as rural and urban reconstruction projects, agricultural, waste handling and circularity-related applications, there is a growing need for machinery that can be adapted to carry out multiple functions and is versatile across applications. Besides the enormous growth potential due to new trends and segments in the domestic market, export markets are another area of focus, as the Indian CE industry gears up to attain the number 2 spot in the global CE arena. Skilling is another strategic requirement since skilled equipment operators are essential, not only for efficient and time-bound completion of projects, but also from the safety standpoint, especially because most of the construction and mining equipment are operated in hazardous environments. The industry’s transition will, thus, be driven by its workforce, which needs to evolve in response to the changing workplace requirements.