The construction equipment industry in India is expected to grow +20% this year to 58,465 machines, according to Off-Highway Research. The specialist consultant and market forecasting study said sales of construction equipment grew +37% in the first six months of the year, compared to the same period in 2015.
The market has seen a turnaround over the last 18 months, with sales falling to a low of 47,889 units in 2014, before enjoying a small increase last year. The expected +20% surge in demand in 2016 is the result of infrastructure investment in India, and this is expected to sustain market growth for the next four years, albeit at more sustainable levels.
“Infrastructure development is a key economic driver and enjoys an intense government focus that should accelerate demand for construction equipment in the country. India needs an estimated investment of INR 31 trillion (US$ 465 billion) over the next five years to keep pace with its growth targets, of which over 70% would be needed for power, roads and urban infrastructure segments. The total budgeted outlay for the infrastructure sector for fiscal year ending March 2017 is INR 2.2 trillion (US$ 33 billion),” said the report.
The general buoyancy of the market is expected to see sales rise to 73,595 units in 2020. That would represent record volumes for the Indian equipment market, the previous high being the 67,898 units sold in 2011.
Backhoe loaders remain extremely popular in India, with 24,500 such machines expected to be sold this year, representing 42% of the market in volume terms. However, Off-Highway Research believes the strongest long-term growth prospects are in the crawler excavator segment, which is expected to double in size between 2015 and 2020 to 22,000 units per year.