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India’s construction equipment industry reported a marginal decline in overall sales during FY26 as slower infrastructure execution, project delays and liquidity concerns affected domestic demand. Total equipment dispatches fell nearly 2 per cent year-on-year, while domestic sales declined around 7 per cent. Despite these challenges, exports recorded strong growth of 32 per cent, helping the sector maintain stability. Industry body ICEMA said delays in land acquisition, slower contractor payments and higher equipment costs due to new emission norms impacted the market. However, the industry remains optimistic about long-term growth driven by continued infrastructure development across the country.
The construction equipment industry in India recorded a slight decline in total sales during FY26, with overall dispatches falling to 1,36,995 units compared to 1,40,191 units in the previous financial year, according to the Indian Construction Equipment Manufacturers’ Association (ICEMA). Advertisement
The industry body stated that the decline was mainly due to temporary challenges in the domestic market, including slower execution of infrastructure projects, delayed payments and land acquisition issues. At the same time, exports grew strongly by 32 per cent, reflecting increasing global demand for construction equipment manufactured in India.
Speaking in New Delhi, ICEMA President Deepak Shetty said the slowdown should not be viewed as a structural weakness in the sector. He stated that government capital expenditure allocations continued to remain high, but delays in project execution and slower disbursement cycles impacted equipment demand across the country.
He further said the export performance highlighted the growing competitiveness of Indian-made construction equipment in international markets and added that the industry remained positive about long-term growth due to India’s continued focus on infrastructure development.
Domestic sales during FY26 declined around 7 per cent to 1,13,229 units from 1,21,301 units recorded in FY25. The moderation reflected cautious buying sentiment across infrastructure and construction segments.
India continues to remain the world’s third-largest construction equipment market. Industry estimates project the sector to reach USD 14.76 billion by 2030, growing at a CAGR of 8.3 per cent.
Among equipment categories, earthmoving equipment continued to dominate the market with a 71 per cent share. Sales in this segment stood at 97,236 units, witnessing a 2 per cent year-on-year decline.
Material handling equipment sales dropped 10 per cent year-on-year to 15,290 units. Concrete equipment remained almost flat at 14,486 units with marginal growth of 0.09 per cent.
Road construction equipment was among the few segments to report positive growth, rising 6.3 per cent to 7,445 units. Material processing equipment also registered a modest increase of 1.2 per cent at 2,538 units.
ICEMA stated that the infrastructure equipment sector faced several challenges during FY26. National highway construction activity reportedly hit a seven-year low because of delays in land acquisition and fewer project awards. The slowdown in the Jal Jeevan Mission due to moderated fund disbursement also affected demand in the sector.
The industry body added that delayed contractor payments created liquidity pressure across construction activities. In addition, implementation of CEV Stage V emission norms from January 2025 increased equipment costs significantly, especially as the industry remains heavily dependent on financing. Rising global commodity prices, including crude oil and bitumen, added further pressure during the second half of the financial year.
ICEMA Vice President Shalabh Chaturvedi said India’s infrastructure growth story remained strong, but timely execution of projects, faster on-ground implementation and improved liquidity support for contractors would be important for restoring growth momentum in the sector.
The construction equipment industry has seen strong growth over the last few years due to increased government spending on roads, railways, metro projects, mining and urban infrastructure. However, industry experts believe that faster project clearances, smoother fund flow and stable raw material prices will be important for sustaining demand going forward.
Source PTI
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