Equipment funding is a very important aspect and the recent lockdown and subsequent moratoriums have created an array of problems for the NBFCs and the reason why the CE Industry at the current juncture is feeling a constraint. This needs to be addressed as soon as possible for the benefit of all associated with the infrastructure sector to ensure the desired availability of equipment at the project sites.
The big question today would be the ability of the Government to put in place the required resources and funding to ensure the revival and continuity of Infrastructure development.
Covid-19 is a once in a life-time event and is causing unprecedented effects on the economy and livelihood of people across the globe. The month of April was more or less a complete wash-out for the Construction and the CE Industry and partial activity started only in the month of May.
There is going to be pain in the short-term for the Infrastructure as well as the CE Industry, as both of them are currently reeling under the ill effects caused by the lockdown: migrant workers being the prime constraint for the construction industry, and the temporary evaporation of demand for equipment being the most prominent one. This phase is expected to continue well into Q2 of this year and hopefully the second half of the year will be better, but I am sure that the situation will normalize around the same time next year.
Infrastructure development has always been on top of the agenda for the Government, as it is perhaps one of the meaningful ways to churn the wheels of the economy. So, I am sure that the Government will continue to take all possible steps to ensure the health of the Infrastructure sector. But the big question today would be the ability of the Government to put in place the required resources and funding to ensure the revival and continuity of Infrastructure development.
Contractors, OEMs, Rental Companies and Financial Institutions will have to work hand-in-glove to ensure the viability and sustenance of each other’s businesses.
The demand scenario post Covid-19 lockdown has been bleak so far and is the biggest challenge being faced by the CE industry in the short term. The other two major challenges would be to ensure liquidity and viability of the ventures with 50% reduced business scenario. Contractors, OEMs, Rental Companies and Financial Institutions will have to work hand-in-glove and ensure the viability and health of each other’s businesses and their sustenance.
Equipment funding is a very important aspect and the recent lockdown and subsequent moratoriums have created an array of problems for the NBFCs and the reason why the CE Industry at the current juncture is feeling a constraint. This needs to be addressed as soon as possible for the benefit of all associated with the infrastructure sector to ensure the desired availability of equipment at the project sites.
Our country is already using technologically advanced machinery for road construction, which is comparable to that of our global peers.
Going forward, further digital inclusions in the machines for mapping, controlling, and assisting in increasing productivity and reducing costs, will be the need of the hour, and we are working on the same at ACE. Over the years, a lot of high-end and critical components have been indigenized and this is a continuous process, which primarily depends on the consumption patterns of such components and aggregates within the country. Most of the leading global component manufacturers have set up shop in India and we really do not foresee much of the demand supply gap over the next few years.
