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Cement Industry Insights

The cement industry in India is primarily controlled by government through pricing of key inputs like coal, power, transportation. Most state governments offer fiscal incentives to attract investment in the form of tax exemptions or deferrals. Currently the industry is booming due to many government infrastructure projects. The industry consists of both organized large companies and many smaller regional producers. Technology is crucial from mining through production, and the government is looking to acquire new efficient and environmentally friendly technologies from other countries.

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419 views1 page

Cement Industry Insights

The cement industry in India is primarily controlled by government through pricing of key inputs like coal, power, transportation. Most state governments offer fiscal incentives to attract investment in the form of tax exemptions or deferrals. Currently the industry is booming due to many government infrastructure projects. The industry consists of both organized large companies and many smaller regional producers. Technology is crucial from mining through production, and the government is looking to acquire new efficient and environmentally friendly technologies from other countries.

Uploaded by

jalmahal
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
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PEST Analysis

POLITICAL

The price of cement is primarily controlled by the coal rates, power tariffs, railway
tariffs, freight, royalty and cess on limestone. Interestingly, government controls all of these
prices. Government is also one of the biggest consumers of the cement in the country. Most state
governments, in order to attract investments in their respective states, offer fiscal incentives in
the form of sales tax exemptions/deferrals. States like Haryana offer a freeze on power tariff for
5 years, while Gujarat offers exemption from electric duty.

ECONOMIC

Currently, the industry is on the boom, with a lot of government infrastructure and housing
projects under construction. In spite of seeing a fall during 2008-09, the export segment of the
industry is expected to grow again on account of various infrastructure projects that are being
taken up all over the world and numerous outstanding cement plants coming up in near future in
the country.

SOCIAL

Usually, the cement industry in India consists of both the organized sector and the
unorganized sector. Organized sector comprises of the well-known cement manufacturing companies
while the main players of the unorganized sector are the regional and local cement-producing units in
various states across the state. Indian consumers prefer buying branded cement like ULTRATECH,
JAYPEE CEMENT, LAFARGE CEMENT etc. It has been seen in the past, as well, that mini cement
plants with low brand value and image are not able to survive against the cement giants. With a
population of more than 100 million people, it is expected that cement industry will create another 25
lakhs jobs in the next 4-5 years.

TECHNOLOGY

From mining to production the entire process depends on technology. The Government of
India plans to study and possibly acquire new technologies from the cement industry of Japan. The
government is discussing technology transfer in the field of energy conservation and environment
protection to help improve efficiency of the Indian cement industry.Cement industry has made
tremendous strides in technological up-gradation and assimilation of latest technology. At present
93% of the total capacity in the industry is based on modern and environment-friendly dry process
technology.

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