India Proposes Rs. 13,000-Crore Incentive Scheme for Construction Equipment Sector
The Indian government is considering a Rs. 13,000-crore incentive scheme for the construction equipment sector. This move aims to boost domestic manufacturing and reduce dependence on imports. Meanwhile, prominent players like Action Construction Equipment Limited (ACE) and Escorts Kubota Limited have reported mixed financial results.
The Ministry of Heavy Industries (MHI) has proposed the scheme, which is currently under discussion with relevant ministries. It is expected to be presented for Cabinet approval in the coming months. The scheme aims to support domestic manufacturing and reduce import dependence, as India's mining and construction equipment sector imports nearly half of its components by value from countries including China, Japan, South Korea, and Germany.
Both ACE and Escorts Kubota Limited are significant players in the construction equipment sector. ACE specializes in manufacturing construction equipment like loaders and compactors, while Escorts Kubota focuses more on agricultural machinery along with construction equipment. Escorts Kubota holds a stronger market position due to its diversified product range and established presence in both agriculture and construction sectors. ACE, in particular, is the world's largest manufacturer of Pick & Carry cranes, commanding over 63 percent market share in India's mobile crane segment.
In terms of financial performance, ACE experienced a decline in revenue but a growth in net profit in Q1 FY26 compared to the previous year. On the other hand, Escorts Kubota reported a rise in net profit but a decline in revenue for the same period.
The proposed incentive scheme is expected to provide a significant boost to the domestic construction equipment sector. Meanwhile, industry leaders like ACE and Escorts Kubota continue to navigate the market with mixed financial results, reflecting the dynamic nature of the sector.
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