Industry Research Update
Indian Cement Industry – Update
With 509 million tonnes per year (mtpa) of cement production capacity as of 2018,
India is the second largest cement producer in the world and accounts for over 8 per
cent of the global installed capacity, as of 2018. Cement production is reached to
337.32 million tonnes in 2018-19 and stood at 216.8 million tonnes between April-
November 2019. The cement production capacity is estimated to touch 550 MT by
2020. Of the total capacity, 98 per cent lies with the private sector and the rest with
the public sector. The top 20 companies account for around 70 per cent of the total
production.
The demand of cement industry is expected to achieve 550-600 million tonnes per
annum constantly by 2025 because of the expanding requests of different divisions
i.e. housing, commercial construction and industrial construction.
A total of 210 large cement plants together account for 410 million tonnes of
installed capacity in the country, while 350 mini cement plants make up the rest. Of
the total 210 large cement plants in India, 77 are located in the states of Andhra
Pradesh, Rajasthan and Tamil Nadu. Cement production in India increased from
230.49 million tonnes in 2011-12 to 297.56 million tonnes in 2017-18. India’s
exports of cement, clinker and asbestos cement increased at CAGR of 10.54 per cent
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Industry Research Update
between FY12-FY20 (April-July 2019) to reach US$ 177.93 million. During the same
period imports of cement, clinker and asbestos cement increased at a CAGR of 7.99
per cent to US$ 57.61 million in FY20. To enhance the source of capital for
infrastructure financing, Credit Guarantee Enhancement Corporation for which
regulations have been notified by the RBI, will be set up in 2019-20.
FDI inflow in industry related to manufacturing of cement & gypsum products
reached US$ 5.28 billion between April 2000 and September 2019.
The Government of India is strongly focused on infrastructure development to boost
economic growth and is aiming for 100 smart cities. The government also intends to
expand the capacity of the railways and the facilities for handling and storage to
ease the transportation of cement and reduce transportation costs. These measures
would lead to increased construction activity thereby boosting cement demand. As
per Union Budget 2019-20, Government is expected to upgrade 1,25,000 kms of
road length over the next five years.
Source : IBEF
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