Ajay Mandahr, CEO, Escorts Construction Equipment
It is imperative for the economy to attract FDI in Infrastructure.
Covid-19 pandemic and the uncertainty resulting for the same has disrupted the sector negatively. Last year, the industry was down 25% (YoY) and in Q-1, FY’21, the market has been majorly washed out. The general expectation (or speculations) doing the rounds in the industry is that the market will start to show some respectable (read profitable) demand from Oct’20 onwards.
Historically, the demand growth for CE has been correlated to government spend on Infrastructural activities. In the current pandemic scenario, it’s vital that the government ramps up the infrastructure spending. With PM’s vision of US$ 5 trillion economy by 2025, it’s important to put on track the Infrastructure development (the engine of growth) at the earliest. Liquidity is facing a strong headwind due to the economic slowdown and hence it’s imperative for the economy to attract FDIs in Infrastructure. A few aggressive initiatives and faster monetization of the completed projects could provide the much-needed investments and liquidity for the new projects.
We expect 20-25% growth of the CE sector from next year onwards for the next 3-4 years.
The Government has proactively removed some major obstacles in attracting investments viz. 90% acquisition of land before contract award, new alignments for land acquisition, cost optimization, simplified environment clearance, etc. The CE sector has a great future ahead and we expect 20-25% growth from next year onwards for the next 3-4 years. The anticipated recovery in the H-2, FY’21 is expected from the pent-up demand and increased mechanization of 5-10% resulting from reverse migration of labour.
Rescheduling of bauma CONEXPO INDIA to Feb 2021 was inevitable given the current uncertainty and demand contraction.
Given the current pandemic situation and keeping in view the health and safety related challenges, this rescheduling was inevitable. Further, given the uncertainty and major demand contractions, most of the companies would like to preserve cash. In the list of priorities, exhibition participation would be stacked lower than employee safety and welfare, digital investments, product developments, etc.
