Delivering the inaugural address, Anil Kumar Lahoti, Chairman & CEO, Railway Board, Indian Railways, said, "Infrastructure, especially transport infrastructure, plays a crucial role in the country’s economic growth by enabling last mile connectivity across the nation. The Government's focus on growing the railway network will not only help in connecting the far-flung areas of the country but will also bring down the logistics costs of development."
“As the Indian Railways gears up on the back of the high budgetary allocation, the CE industry expects a spurt in demand to facilitate the increasing number of railway projects,” said Dimitrov Krishnan, President - ICEMA and Managing Director, Volvo CE India.
Commented Deepak Shetty, Convener, ICEMA S.M.A.R.T. Infra Panel and CEO & Managing Director, JCB India, "The CE industry is being recognized for its contribution to creating world-class infrastructure. This is because the quality of the Indian construction equipment and machineries is second to none. The CE Industry is delivering products with the highest level of mechanisation that match global standards.”
"As infrastructure projects move to higher levels of mechanisation, there is a growing role of the CE industry in facilitating world-class infrastructure for India," said Lahoti.
The event was attended by financiers, banks, leasing companies, OEMs, vendors, and infrastructure developers. Discussions were held on the current infrastructure and financing of Construction Equipment (CE) in the country, wherein financing challenges faced by developers and construction equipment buyers were identified.
Experts further deliberated on the merits of harnessing data analytics to devise innovative fintech solutions for an evolved and robust financing ecosystem in the country, which would address the need gaps in this critical area.
Construction Equipment, which accounts for about 20–30% of the investment in a typical infrastructure development project, is a critical enabler in infrastructure development. However, the industry’s potential is limited by issues pertaining to access to finance, since the industry is dependent on finance to the extent of 90% of the cost of a machine.
“With India’s economic growth hinging critically on infrastructure and related growth of the CE sector, it is imperative to ensure a robust financing ecosystem in the country to meet the growing requirements of both infrastructure and the CE industry in terms of enhanced access to long term finance,” emphasised Krishnan.
Touching upon the role of ICEMA, he added, “In view of the significance of the Indian CE industry in facilitating and catalyzing economic growth, ICEMA continuously engages with stakeholders, including policy makers, banks, and financial institutions, to engender consensus on critical issues, devise innovative solutions, and create an enabling financing environment for our industry.”
As regards financing avenues and options for infra projects and the CE industry, Ashok Sharma, Chief General Manager, SBI, explained, “There is no shortage of funds in the Indian Banking sector. We are capable of long-term financing of infrastructure projects on competitive terms as compared to both the private sector and foreign investors."
Emphasizing the importance of innovative financing solutions for the CE industry, Gokul Chaudhri, President – Tax, Deloitte India (knowledge partner of the Conclave), said, "The bold policy initiatives such as the US$ 1.4 trillion National Infrastructure Pipeline (NIP) and the Gati Shakti program are creating a fly wheel effect for the rapid growth of the infrastructure sector and the Construction Equipment industry. The time is right for policymakers to consider a Performance Linked Incentive program (PLI) for the CE Industry, to propel the Atmanirbhar agenda, and create employment and export opportunities."
The CE industry’s access to finance is frequently hampered by the fact that lending processes in the country are often stringent, tedious, and time-consuming. In view of this, the CE financing industry and CE OEMs, who have, in the past, collaborated to enhance access to finance with several disruptive innovations, are now gearing up to go the digitalisation route to bring about the much-needed paradigm shift in the industry’s financing ecosystem.