Diesel use in construction equipment sector must drop, says Road Minister Gadkari

The construction equipment sector consumes a large amount of diesel, and if India wants to achieve its economic goals, this needs to change, Minister of Road Transport and Highways Nitin Gadkari said on Thursday.

While addressing the Baja SaeIndia event 2025, Gadkari pointed out the importance of reducing dependency on fossil fuels, whether in urban areas or agricultural landscapes, noting that the construction equipment sector, which is heavily dependent on diesel, is not close to achieving this feat. To address this, India, the third largest net importer of crude oil and petroleum products, aims to achieve a net zero target by 2070. It is also one of the biggest emitters of greenhouse gases.

The government’s push for bio-fuels includes a 5% biodiesel target by 2030.

The government has targeted 20% ethanol blending with petrol and is likely to increase this beyond 20% in the coming years.

The government is pitching blending in petrol and diesel to reduce the dependence on imported fossil fuels and improve energy security. The consumption of ethanol and methanol by oil marketing companies also boosts farmers’ incomes.

The road minister has been urging the industry to switch to alternative fuels and noted that the construction and mining operations consume 400 crore liters of diesel, which is unhealthy for both the environment and the economy.

As per CRISIL, India’s construction equipment sector is likely to see a slower growth of 4-6% in the financial year (FY) 2025 to around Rs 83,000 crore.

This is slower than the 27% growth seen in FY24, when sales volume reached 1.35 lakh units, supported by strong demand from roads, railways and mining segments.

However, revenue is projected to grow during the financial year despite lower sales due to the rise in prices following the introduction of the new emission norms.

Leading construction equipment manufacturers such as SANY India are positive on this growth. In an earlier interaction, the company’s Chief Operating Officer for Sales, Marketing & Customer Support Sanjay Saxena told Autocar Professional that the company is expected to reach Rs 30,000 crore revenue by 2030 on the back of government investments and increasing urbanisation.