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India's construction equipment sales fell 2% year-on-year to 136,995 units in fiscal year 2025-26, weighed down by delays in infrastructure project execution and land acquisition, according to the Indian Construction Equipment Manufacturers’ Association (ICEMA). Domestic demand, excluding non-OEM exports, dropped approximately 7% across most equipment categories despite sustained government capital expenditure allocations.
Exports surged 32% in FY26, reaching record levels and emerging as a critical growth driver, ICEMA said. The sector maintained its position as the world's third-largest construction equipment market, currently valued at USD 10 billion and projected to grow to USD 14.76 billion by 2030 at a CAGR of 8.3%. Over 95% of equipment sold domestically was manufactured in India, while imports rose 17%, primarily in earthmoving, material handling, and concrete equipment.
Earthmoving equipment remained the dominant segment with a 71% market share, recording 97,236 units sold despite a 2% annual decline. Road construction equipment saw 6.3% growth to 7,445 units, while material processing rose 1.2%. Material handling sales dropped 10% to 15,290 units, and concrete equipment sales were flat at 14,486 units.
ICEMA attributed the domestic slowdown to delayed contractor payments, slower National Highway and Jal Jeevan Mission implementation, and higher equipment costs following CEV Stage V emission norms. The Union Budget 2026-27 introduced an incentive scheme to boost localisation of critical components, and ICEMA expects equipment demand to recover as public capex of ₹12.2 lakh crore for FY27 fuels infrastructure activity.