Union Budget 2020 India: Construction sector can take India’s economy closer to the Narendra Modi-led government’s ambitious goal of a 5 trillion dollar economy and also push the flagship scheme of Make in India. However, the liquidity crisis and a shortfall of skilled manpower have kept the sector away from growth. In the upcoming Budget 2020, the industry expects the government to take steps towards creating more funding opportunities for the homegrown companies. “We believe with the upcoming Union Budget 2020, the government will focus on raising the import duty especially in the product segments where India is self-sufficient in both capacity and technology,” Sorabh Agarwal, ED, Action Construction Equipment, told Samrat Sharma of Financial Express Online in an interview. Here are excerpts of the interview.

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What do you expect from the Union Budget 2020?

We welcome the government’s recent announcement of allocating Rs 100 lakh crore investment in the infrastructure industry for the next five years. It is a positive move and will provide a major push to the development of the construction equipment industry. We believe with the upcoming Union Budget 2020, the government will focus on raising the import duty especially in the product segments where India is self-sufficient in both capacity and technology. The industry would like to see a major push to the Make in India mission through this budget and approach towards creating more funding opportunities for the homegrown companies.

How is the current landscape of the construction sector in India?

I believe that being the biggest drivers for the Indian economy for almost half a decade, the construction industry has seen its steepest fall in the FY19, largely due to global financial turmoil. The sector has been hit hard by the economic slowdown and has seen the negative growth from 8.7% in FY 19 to 3.2% at present. This slowdown has directly impacted the associated sectors like steel, paint, glass, port, aluminium, cement, power, ports etc, making the loss more visible.

The construction equipment industry has also seen a slump in the purchases of the new equipment’s by 18-25% in the last fiscal. We believe this dip in the sales is due to lack of funds and down drift in the allocation of new projects in the sector.

What are the challenges faced by the construction and related industry?

The liquidity crisis has been a major challenge in the construction sector and has been the biggest stress for players in recent years. The industry in itself produces good employment opportunities and most of it is restricted to manual jobs. We feel due to lack of skilled and certified manpower in the market, the efficiency of projects gets compromised while making it risky in tandem.

The industry also feels that the government needs to shift the focus towards creating more funding opportunities in the sector specially for the homegrown companies as this will eventually boost the Make in India initiative apart from generating employment opportunities.

How do you see this industry as a job creator?

With the construction activities going up in the coming years, I foresee the holistic creation of job opportunities in CE industry for both on sites and operations. Another area, where a large number of job opportunities will be generated is the operators & maintenance section, wherein skilled manpower will be required for operation and maintenance of these heavy equipment.

Since, now most OEMs are upgrading their manufacturing facilities in an intelligent and innovative manner by using automation, robotics, and advanced technologies for manufacturing high-tech machines, a large number of skilled manpower will be required.

Infact, construction activities across segments will play a major role not only in terms of making India a 5 trillion dollar economy but also towards generating employment opportunities.