The industry veteran stressed on the urgent need for localisation, component manufacturing parks, skill development, and government-backed incentives to unlock the sector’s $25 billion potential.
05 Sep 2025 | 4854 Views | By Darshan Nakhwa, Yukta Mudgal, and Shahkar Abidi
The Indian construction equipment (CE) industry has been on a remarkable growth trajectory over the last few years barring an odd blip, but Anand Sundaresan, Director of Ammann India Pvt Ltd, believes the foundations are not yet strong enough to sustain the journey. He pointed out that while industry volumes ...
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The Indian construction equipment (CE) industry has been on a remarkable growth trajectory over the last few years barring an odd blip, but Anand Sundaresan, Director of Ammann India Pvt Ltd, believes the foundations are not yet strong enough to sustain the journey. He pointed out that while industry volumes are rising, systemic gaps remain.
“If you include unorganised players in concreting and asphalt equipment, India’s construction equipment industry produced and sold nearly 150,000 units last year. That is a big number, but still only a step towards the $25 billion target by 2030,” Sundaresan said at Autocar Professional’s Construction Equipment Inner Circle, a CXO Roundtable hosted by ZF Group.
For him, the real challenge is not in selling more equipment but in creating the industrial backbone that makes such growth self-sustaining.
According to Sundaresan, the limitation of the component manufacturing ecosystem remains a major issue for the industry. “Unfortunately, the manufacturing ecosystem is not complete in India. We don’t have component manufacturers here, so we are unable to make ourselves competitive in the marketplace,” he said.
Even when parts are described as localised, the picture is misleading. “A construction equipment manufacturer may say a hydraulic cylinder is localised, but in reality, the tube is imported, the seals are imported–80% of it is still coming from abroad,” he explained.
His prescription is ambitious: government-backed industrial parks dedicated to construction equipment component makers, supported by subsidies and export incentives, similar to the auto components sector. “So that the overseas firms can come and set up shop here. Unfortunately, whether we like it or not, in certain areas, we have not been able to develop technology…Even small parts like seals and O-rings are not up to the mark when made locally. Without support, we will remain dependent on imports,” he said.
Tracing the industry’s arc over the past decade and a half, Sundaresan recalled how volatile the ride has been. Post-Lehman crisis and the 2G/4G scam in India, sales were stuck between 75,000-80,000 units. The tide turned in 2016, setting the stage for a revival that pushed volumes to 140,191 units in FY25. The industry recorded 26% year-on-year growth in both FY23 and FY24 before slowing to just 3% last year.
For the construction equipment industry, the goal now is 250,000 units annually by 2030, equivalent to a $25-billion market. Sundaresan insists the ambition is realistic but conditional. He said the industry could achieve its targets if the government extended support and a robust manufacturing ecosystem was put in place.
On the incentives front, the Indian Construction Equipment Manufacturers Association (ICEMA) has urged the Ministry of Heavy Industries to roll out a production-linked incentive (PLI)-style scheme focused on component manufacturing for construction equipment, as concerns rise over the impact of fresh U.S. tariffs on Indian machinery exports.
Changing Global Perceptions
For Sundaresan, one of the most encouraging shifts has been the transformation in how Indian construction equipment is viewed globally. “Fifteen years ago, Indian products were seen as cheap and poor quality. Even our own parent companies were reluctant to source from India,” he said. That perception has eroded. JCB India now exports to over 130 countries from India, and Ammann India itself generates around 23% of its revenue from overseas sales.
But the transformation remains incomplete. India still imports large cranes, piling rigs and horizontal drilling machines which are vital tools for development of modern infrastructure. “If India wants to be truly Atmanirbhar, then these products must be produced locally,” Sundaresan said.
On the global competition, he said, it has shifted dramatically. Europe is no longer the benchmark; the real rival is China. “Europe can’t match our price points anymore. Our real competitor is China. To hold our ground, we must improve efficiency like the automobile industry did,” he said.
Yet domestic market conditions are often unsupportive. Road tenders, for example, are sometimes quoted at uneconomical rates. “People are quoting minus 25, minus 30, even minus 35. How can they buy good-quality equipment then? It’s impossible,” Sundaresan said, highlighting the downward pressure on margins.
The Operator Deficit
Alongside manufacturing bottlenecks, Sundaresan drew attention to a less-discussed problem: the lack of trained operators. “With 140,000 machines sold annually, we need at least 280,000 operators each year, considering two operators per machine. But we are training only about 20,000 people,” he said. “This is because the use of certified operators is not mandated by the government.”
The Infrastructure Equipment Skill Council, promoted by ICEMA, has been working for over a decade, but without mandatory certification, progress has been limited. “Driving an excavator is not like driving a truck. To get the best performance, certified operators are essential,” Sundaresan said.
Sustainability as Strategy
One area where Sundaresan struck an optimistic note was sustainability. Pressure is coming not only from government policy but also from the ESG commitments of global parent companies.
“We have introduced battery-operated compactors and pavers. We have shifted asphalt plant heating from diesel to electric, and are using RAP (Reclaimed Asphalt Pavement) technology. In Europe, we’ve reached 100 percent RAP usage; in India, we have gone up to 60 percent,” he said.
While such technologies carry upfront costs, Sundaresan argued they ultimately save money. “If a client uses RAP, they not only recover costs quickly but often make five times more than they invested. So it’s not just an imperative but can add to the bottomline,” he said.
Ammann India, a wholly owned subsidiary of the Swiss-based Ammann Group, is a manufacturer of road construction equipment. The company’s product portfolio spans asphalt mixing plants, compactors, pavers, and concrete batching plants. Established in 2012 after Ammann acquired a majority stake in Gujarat-based Apollo Construction Equipment, the Indian arm combines the Swiss group’s 150-year-old expertise in road-building technology with localised engineering and manufacturing.