Economy & Market

Indian Cement Industry: The year gone by and the challenges ahead

Published

14 years ago

December 31, 2011

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Though the year 2011 has been bumpy for the Indian cement sector, demand growth for the sector is likely to bounce back given the positive outlook of the general construction and infrastructure sector. The main impediments which have impacted the industry are the recent devaluation of the rupee and bank funding becoming costlier for the industry. This has led to a rise in import & input costs for the company in the form of freight and logistics cost. Read on to know the journey of the Indian Cement industry in the current scenarioIndia is the second largest producer of cement in the world after China and the Indian cement industry has seen a tremendous boom during the last few years in sync with the booming Indian economy. However, the fiscal 2011-12 saw the Indian economy suffering a setback due to an increase in inflation, spiking interest rates and a surge in the prices of commodities and fuels alongwith a devalued rupee. A lull has also been observed in the country’s housing sector, which accounts for over 60-70 percent of the country’s cement demand.Pervasion of a negative sentiment in the Indian Economy :As per the monthly "Economic Watch for November 2011" brought out by the Federation of Indian Chambers of Commerce and Industry (FICCI), the country’s economic growth is expected to slump to 6.6-6.8 percent in the financial year 2011-12. This projection by the industry’s apex body comes in the wake of the Indian government having lowered the country’s GDP growth forecast from the originally projected 9 percent to 7.25-7.75 percent. A poor performance by the mining, manufacturing and capital goods sectors resulted in a 5.1 percent on year contraction in the country’s industrial production in October in over two years. The growth of India’s GDP in the July-September quarter was pegged at 6.9 percent, the lowest in two years on account of the weak global fundamentals and a tight monetary policy by the government. The export sector is also likely to witness a moderation given the bearish fundamentals gripping the world economy. The situation has been complicated further by a widening trade deficit in the current fiscal. Exports for the April-November period increased by 33.2 percent on year to $ 192.7 billion while imports rose by 30.2 percent on year to $ 309.5 billion.A gloom has also been witnessed in the investment climate of the country with a slowdown in the housing and construction industry, which are critical demand drivers for the cement industry. This view was further emphasized by Jayram Nambiar, Ex Managing Director, Pfeiffer India Pvt Ltd who stated, "there has been a substantial reduction in private investments in major capital projects in 2011. There has been low government expenditure on public projects and a fall in investment levels in the housing and construction industry. The cement industry is unlikely to see a revival in demand to the tune of 8-9 percent for some time."Indian Cement Industry : The year that wasThe negative sentiment in the economy has also found its reverberations in the cement sector.Jayram Nambiar, Ex Managing Director-Pfeiffer India Pvt Ltd has concurred "as per a report by the CMA, the country produced 98.81 mt of cement in April-October 2011 which is only 1.2 percent higher than 96.75 mt produced in 2010. A slowdown in demand for cement has been noticed from the housing industry and if the trend continues, the annual growth in demand for cement will remain in the range of 3 per cent on a year on year basis , in 2011-12". The year 2011 also witnessed low cement capacity utilizations compounded by a fall in capacity additions. It was further observed that inspite of an oversupply situation, increased cost of inputs such as fuel and commodities led to a rise in prices of cement across India. Commenting on the capacity parameters for the cement industry, Umesh Shrivastava, Executive Chairman, Holtec Consulting Private Limited stated, "the average capacity utilization, over the year is likely to be in the range of 70-75 percent, which despite being low, is pegged at a level higher than the breakeven point of 50 percent. A slowdown has also been observed in capacity additions, with only 12-13 mtpa of capacity commissioned till now. A capacity addition of around 30 mtpa was expected to come onstream in the period April 1, 2011-31 March 2012." The industry was expecting the installation of around 15-20 mtpa of capacity in 2011. However, a difference in value perceptions between prospective sellers and buyers led to the prospect remaining unrealized. As compared to a peak cycle witnessed during FY 2007-08, cement industry utilization rates witnessed a downslide in FY 2011-12. Commenting on this aspect, Sumit Banerjee, Vice Chairman, Reliance Cementation augured, "the cement sector is cyclical in nature and continues to witness peak and trough cycles. Following a peak capacity utilization rate of 98 percent in FY08, the industry witnessed a down cycle with utilization rate falling to 74 percent in FY 2011-12. Hopefully, this should be the bottom of the cycle with the utilization rate expected to record an improvement to 76 percent in FY 2012-13 and further to 79 percent in FY 2013-14."A moderate 3.1 percent year on year growth in dispatches was recorded by the Indian cement industry in FY 2011-12, following a year on year increase of 4.5 percent in FY 2010-11. The bleak scenario was a result of muted demand, especially in the Southern Indian state of Andhra Pradesh due to political instability. Demand growth for cement in fiscal 2011-12 was expected to remain lower at 4.5 percent due to a slowdown in the economy, sluggish growth in infrastructure and real estate projects and a low momentum in government sponsored housing and irrigation schemes.Cost pressures also added to the woes of the cement industry in this fiscal. There was a rise in limestone mining costs due to a hike in prices of diesel in June 2011. Heavy monsoons in the coal mining areas also forced cement companies to import coal at inflated price levels due to a fall in the value of the rupee. High input costs coupled with a fall in demand led to a pressure on the margins of companies. Commenting on the cost factor, Sumit Banerjee, Vice Chairman, Reliance Cementation said, "severe pressure has been exerted over cement production costs over the last two years. The underlying reason behind the same was an increase in costs incurred on raw material, fuel and power, and freight costs which account for around 70 percent of the overall costs for the manufacture of cement. This has affected the operating margin of the industry, which has gone down significantly inspite of higher cement prices."The year can also be noted for technological developments which included waste heat recovery systems and utilization of lower grades of limestone for making clinker. Positive moves were also witnessed on the part of stronger players in the domestic cement arena who tried to establish production capacities outside India and acquire sources for solid fuel.The road aheadThe future largely appears bleak for the cement industry in the fiscal 2012-13 due to prevalent weak economic fundamentals. Commenting on the adversities likely to be faced by the industry, Jayram Nambiar, Ex Managing Director, Pfeiffer India Pvt Ltd said, "looking ahead, the economic scenario the world over and in India is anti growth and the worst is yet to come. The problem in India has been compounded by the current unfavorable political climate. The coming general election is unlikely to lead to the emergence of a strong political party or coalition. The growth levels of 2008-09 are not likely to be witnessed over the next two years. The period is also likely to be tough for the cement industry. The industry will have to deal with problems like rising energy costs compounded with the depreciation of the rupee, higher freight and distribution costs and low price realizations due to weak demand." These problems shall further be exacerbated by a rise in labour costs due to inflationary trends and a rise in the cost of living index. However, price levels for cement cannot be expected to increase much due to high unutilized capacity far in excess of demand likely to prevail in 2012 and 2013. However, it should be noted that additional cement capacity of 20 million mtpa is being implemented and will be commissioned in 2012. If sufficient demand exists, a capacity utilisation of more than 85 percent is easily achievable. The weak economic climate will also have an impact on smaller cement producers and their operations, leading to a spate of consolidations. Concurring on this issue, Nambiar reiterated, "presently, 35 percent of the cement production capacity is in the hands of smaller producers for whom the future will be one of tribulation due to unfavourable economic conditions. The next two years will see a period of consolidation in the industry with the smaller players withdrawing from the industry by selling out to the financially stronger cement producers. Their share of the total cement capacity can be expected to increase to over 70 percent by 2014."Being a huge country, there will be a difference in the region wise demand for cement in the country which is broadly divided into the western, eastern, northern and southern regions. Elaborating on this aspect, Sumit Banerjee, Vice Chairman, Reliance Cementation stated, "demand for cement in the South is expected to go southward by 4 percent in FY2011-12, display lower than average growth at 5 percent in FY2012-13 and bounce back sharply in FY2013-14. A rise in growth will be witnessed by the Eastern and Central regions from the lower than average levels of 6 percent in FY2011-12 to 9 percent in FY2013-14. Demand for cement in the Northern region is expected to remain in the range of 7-9 percent while the Western region will show demand in the 10 percent range till FY2013-14."Reiterating on the capacity utilization differentials across different regions, Banerjee stated, "a moderation is expected to set in the average industry capacity utilization rate to 76 percent in FY2012-13 from 79 percent in FGY2010-11 before showing an upward curve to 79 percent in FY2013-14. The highest capacity utilization rates are likely to be witnessed by the Eastern and Northern regions at 90 percent levels in FY2012-13 while higher capacity additions could lead to a fall in capacity utilizations in Central India. Utilization rates are also likely to be impacted in the Western region due to pressure exerted on account of cement supply from Southern India."The industry is also optimistic that demand for cement will surge in the near future through the revival of economic activity by the government especially through investment in infrastructure projects. Expressing confidence that the government will initiate the demand push process, Umesh Shrivastav, Executive Chairman, Holtec Consulting Private Limited stated, "following the slump of 2011, demand for cement is likely to see a recovery process and will touch levels of 6-8 percent in 2012. The increase in growth will be triggered by the government’s drive to revive economic activity by initiating investment in infrastructure projects. A correction is foreseen in interest rates and improved regulation as regards land acquisition and environmental clearance leading to revival of several on-hold projects. Cement prices are likely to maintain an upward curve due to increasing production and ownership costs alongwith lower capacity utilizations."Challenges & Opportunities for Indian Cement Industry during 2012 onwards:The forthcoming year 2012 for the Cement Industry is likely to see more of consolidation but lower growth rate. The challenges and opportunities may be summarized as follows:??Extraordinary delay in mining lease sanction and delay in land acquisition & MoEF clearance.??Non availability of domestic coal clubbed with poor quality. Hence, industry has to depend upon high cost imported coal. ??Depreciation of Indian currency has further increased the cost of imported coal, Fuel, Gypsum & other raw materials.??Continuous hike in power tariff, due to increase in coal cost & cross subsidy. Though captive power plant appear to be a part solution, but CPP is again depending upon coal supply linkage, which is uncertain.??On top of it, total taxation including excise, VAT, royalty and cross subsidy amounts to approx. 39 – 40% of Ex-works sales realization. Cement being mass consuming item, such high taxation needs re-visit.??Low packing rate and low level of dispatches leading to IR – Labor issues as per the applicable rules & norms of wage board.??Cement Plant being a capital intensive unit, high interest cost is another disincentive for fresh investment in the sector.??Reduced spending on Government Projects and Slow down in infrastructure investment is another cause of worry for fresh investment.Some of the Indian Economy Strong Points & Stimulators relating to Cement Industry??Growing population of currently 1.2 billion with increasing spending power??Government pursuing structural reforms, facilitating pan-Asian trade, increasing FDI inflows??Recent push at Prime Minister’s level for large infrastructure projects such as Highways, Roads, Ports, Railways, Power, Housing, etc. ??Requirement of Accelerated industrialization to cater to infrastructure and consumer markets??India’s economic growth based on reforms and economic liberalization likely to sustain on long term basis.Measures to be implemented for stimulating cement demand:In order to stimulate demand in an already sagging industry, the government needs to initiate certain measures in the form of providing tax incentive to the industry, reduce the overall tax value on the commodity and phase out cross subsidy on supportive components. The government can also consider classifying cement as "Declared Goods" like steel having a uniform VAT rate of 4 percent throughout the country. To throw light on the matter further, P.K.Ghosh, Chairman, Ercom Engineers Pvt Ltd Ercom Group said, "the overall taxation value on cement can be brought down to a level of 20-25 percent of ex-works selling price from the current level. Tax incentive should be provided by the government for promoting blended cement in the larger interest of mineral conservation, waste utilization and bringing down carbon emission. Cross subsidy burden on electricity, diesel and railway freight should be phased out in a gradual manner. The supply of superior quality coal should be increased through merchant mining in private sector. Companies who have been allotted captive coal blocks should be asked to increase production for selling in the open market."Cement manufacturers need to maximize production of blended cement by utilizing industrial waste like fly ash and slag for conserving mineral resources. The current average blending ratio in the country is pegged at approximately 27 percent which needs to be increased to 40 percent over the next 4-5 years. High energy consuming old and inefficient equipment needs to be replaced with modern equipment for optimizing and minimizing energy consumption alongwith increasing capacity. The industry needs to adopt the latest technology for Green Cement grinding for reducing clinker consumption and deriving benefits of carbon credits. Ready Mix Concrete (RMC) business may be promoted by cement companies or small companies should be encouraged to undertake RMC business at various locations, leading to bulk supply of cement and consequent reduction in packaging cost.ConclusionIn a nutshell, the government needs to support the cement industry in reviving its fortune through initiatives like reducing tax burden, providing incentives and ensuring availability of superior quality coal.

Economy & Market

SEW-EURODRIVE India Opens Drive Technology Centre in Chennai

Published

2 weeks ago

March 25, 2026

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The new facility strengthens SEW-EURODRIVE India’s manufacturing, assembly and service capabilities

SEW-EURODRIVE India has inaugurated a new Drive Technology Centre (DTC) in Chennai, marking a significant expansion of its manufacturing and service infrastructure in South India. The facility is positioned to enhance the company’s responsiveness and long-term support capabilities for customers across southern and eastern regions of the country.

Built across 12.27 acres, the facility includes a 21,350-square-metre assembly and service setup designed to support future industrial growth, evolving application requirements and capacity expansion. The centre reflects the company’s long-term strategy in India, combining global engineering practices with local manufacturing and service capabilities.

The new facility has been developed in line with green building standards and incorporates sustainable features such as natural daylight utilisation, solar power generation and rainwater harvesting systems. The company has also implemented energy-efficient construction and advanced climate control systems that help reduce shopfloor temperatures by up to 3°C, improving production stability, product quality and working conditions.

A key highlight of the centre is the 15,000-square-metre assembly shop, which features digitisation-ready assembly cells based on a single-piece flow manufacturing concept. The facility also houses SEW-EURODRIVE India’s first semi-automated painting booth, aimed at ensuring uniform surface finish and improving production throughput.

With the commissioning of the Chennai Drive Technology Centre, SEW-EURODRIVE India continues to strengthen its manufacturing footprint and reinforces its long-term commitment to supporting industrial growth and automation development in India.

Concrete

Material Flow Efficiency

Published

3 weeks ago

March 18, 2026

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We explore how material handling systems are becoming strategic assets in cement plants, enabling efficient movement of raw materials, clinker and finished cement. Advanced conveying, automation and digital technologies are improving plant productivity while supporting energy efficiency and sustainability goals.

Material handling systems form the operational backbone of cement plants, enabling the efficient movement of raw materials, clinker and finished cement across complex production networks. With India’s cement industry producing over 391 million tonnes of cement in FY2024 and possessing an installed capacity of around 668 mtpa, according to the CRISIL Research Industry Report, 2025, efficient material logistics have become critical to maintaining plant productivity and cost competitiveness. At the same time, cement production is highly energy intensive and contributes around 7 per cent to
8 per cent of global CO2 emissions, making efficient material flow and logistics optimisation essential for reducing operational inefficiencies and emissions states the International Energy Agency Cement Technology Roadmap, 2023. As plants scale capacity and integrate digital technologies, modern material handling systems, ranging from automated conveyors to intelligent stockyards, are increasingly recognised as strategic assets that influence plant stability, energy efficiency and environmental performance.

Strategic role of material handling
Material handling is no longer viewed as a secondary utility within cement plants; it is now recognised as a strategic system that directly influences production efficiency and process stability.
Cement manufacturing involves the continuous movement of large volumes of limestone, clay, additives, clinker and finished cement across multiple production stages. Even minor disruptions in conveying systems or storage infrastructure can lead to kiln feed fluctuations, production delays and significant financial losses. According to Indian Cement Industry Operational Benchmarking Study, 2024, unplanned downtime in large integrated cement plants can cost between Rs.15–20 lakh per hour, highlighting the economic importance of reliable material handling systems.
Modern cement plants are therefore investing in advanced mechanical handling systems designed for high throughput and operational reliability. Large integrated plants can process over 10,000 tonnes per day of clinker, requiring highly efficient conveying systems and automated stockyards to maintain continuous material flow, suggests the International Cement Review Industry Analysis, 2024. Efficient material handling also reduces spillage, minimises dust emissions and improves workplace safety. As cement plants become larger and more technologically advanced, the role of material handling is evolving from simple transport infrastructure to a critical operational system that supports both productivity and sustainability.

From quarry to plant
The transport of raw materials from quarry to processing plant represents one of the most energy-intensive stages of cement production. Traditionally, limestone and other raw materials were transported using diesel-powered trucks, which resulted in high fuel consumption, dust generation and increased operational costs. However, modern plants are increasingly adopting long-distance belt conveyors and pipe conveyors as a more efficient alternative. These systems allow continuous material transport over distances of 10–15 kilometres, significantly reducing fuel consumption and operating costs while improving environmental performance, states the FLSmidth Cement Industry Technology Report, 2024.
Milind Khangan, Marketing Manager, Vertex Market Research & Consulting, says, “Efficient and enclosed handling of fine materials such as cement, fly ash and slag requires modern pneumatic conveying systems. By optimising the air-to-material ratio, these systems can reduce energy consumption by 10 per cent to 15 per cent while ensuring smooth material flow. Closed-loop conveying further minimises dust loading and improves the performance of bag filters, supporting cleaner plant operations. In addition, flow-regulated conveying lines help prevent clogging and maintain reliable dispatch performance. Overall, automation in pneumatic conveying delivers immediate operational benefits, including improved equipment uptime, lower energy use, reduced material spillage and more stable kiln and mill performance.”
Pipe conveyor systems are particularly gaining traction because they provide a completely enclosed transport system that prevents material spillage and dust emissions. According to global cement engineering studies, conveyor-based transport can reduce energy consumption by up to 30 per cent compared to truck haulage, while also improving operational reliability. Several cement plants in India have already implemented such systems to stabilise quarry-to-plant logistics while reducing carbon emissions associated with diesel transport.

Stockyard management and homogenisation
Stockyards play a critical role in maintaining raw material consistency and stabilising kiln feed quality. Modern cement plants use advanced stacker and reclaimer systems to ensure efficient storage and blending of raw materials before they enter the grinding and pyroprocessing stages. Automated stacking methods such as chevron or windrow stacking enable uniform distribution of materials, while bridge-type or portal reclaimers ensure consistent extraction during kiln feed preparation. These systems are essential for maintaining stable chemical composition of raw meal, which directly influences kiln efficiency and clinker quality. The Cement Plant Operations Handbook, 2024 indicates that advanced homogenisation systems can reduce raw mix variability by up to 50 per cent, significantly improving kiln stability and energy efficiency. Integrated stockyard management systems also incorporate sensors for monitoring bulk density, moisture levels and stockpile volumes, enabling real-time control over material blending processes.

Clinker and cement conveying technologies
Once clinker is produced in the kiln, it must be efficiently transported to storage silos and subsequently to grinding and packing units. Modern cement plants rely on high-capacity belt conveyors, bucket elevators and pneumatic conveying systems to manage this stage of material flow. Steel-cord belt bucket elevators are now capable of lifting materials to heights exceeding 120 metres with capacities reaching 1,500 tonnes per hour, making them suitable for large-scale clinker production lines, states the European Cement Engineering Association Technical Paper, 2023.
For fine materials such as cement, fly ash and slag, pneumatic conveying systems provide a reliable and dust-free solution. These systems transport powdered materials using controlled airflow, ensuring enclosed and contamination-free movement between grinding units, silos and packing stations. Optimised pneumatic systems can reduce energy consumption by 10 per cent to 15 per cent compared to older conveying technologies, while also improving plant cleanliness and environmental compliance, according to the Global Cement Technology Review, 2024.

Automation and digitalisation
Digitalisation is transforming material handling systems by introducing real-time monitoring, predictive maintenance and automated control. Advanced sensors and Industrial Internet of Things (IIoT) platforms enable plant operators to track conveyor health, stockpile levels and equipment performance in real time. Predictive maintenance systems analyse vibration patterns, temperature fluctuations and equipment load data to detect potential failures before they occur. According to McKinsey’s Industry 4.0 Manufacturing Report, 2023, for heavy industries, digital monitoring and predictive maintenance technologies can reduce equipment downtime by up to 30 per cent and increase productivity by 10 per cent to 15 per cent. Digital control centres also integrate data from conveyors, stacker reclaimers and dispatch systems, enabling centralised management of material flows from quarry to dispatch.

Handling of AFR
The growing adoption of Alternative Fuels and Raw Materials (AFR) has introduced new challenges and opportunities for material handling systems in cement plants. AFR materials such as refuse-derived fuel (RDF), biomass and industrial waste often have irregular particle sizes, variable moisture content and lower bulk density compared to conventional fuels. As a result, specialised storage, dosing and feeding systems are required to ensure consistent kiln combustion. According to the Cement Sector Decarbonisation Roadmap published by NITI Aayog in 2026, increasing the use of AFR could enable India’s cement sector to achieve thermal substitution rates of around 20 per cent in the coming decades. To support this transition, plants are investing in automated receiving stations, shredding units, drying systems and precision dosing equipment to stabilise AFR supply and combustion performance.

Energy efficiency and dust control
Material handling systems also play a crucial role in improving plant energy efficiency and environmental performance. Modern conveyor systems equipped with variable speed drives and energy-efficient motors can significantly reduce electricity consumption. Permanent magnet motors used in conveyor drives can deliver 8 per cent to 12 per cent energy savings compared to conventional induction motors, improving overall plant energy efficiency according to the IEA Industrial Energy Efficiency Study, 2023. Dust control is another major concern in cement plants, particularly during material transfer and storage operations. Enclosed conveyors, dust extraction systems and advanced bag filters are widely used to minimise particulate emissions and improve workplace safety.

Future trends in material handling
The future of material handling in cement plants will be shaped by automation, digitalisation and sustainability considerations. Emerging technologies such as AI-driven logistics optimisation, autonomous mobile equipment and digital twins are expected to further improve plant efficiency and operational visibility. Digital twin models allow engineers to simulate material flow patterns, optimise stockyard operations and predict equipment performance under different operating conditions. According to the International Energy Agency Digitalisation and Energy Report, 2024, the adoption of advanced digital technologies could improve industrial energy efficiency by up to 20 per cent in heavy industries such as cement manufacturing. As cement plants expand capacity and adopt low-carbon technologies, intelligent material handling systems will play a critical role in maintaining productivity and reducing environmental impact.

Conclusion
Material handling systems have evolved from basic transport infrastructure into strategic operational systems that directly influence plant efficiency, reliability and sustainability. From quarry transport and automated stockyards to digital dispatch platforms and advanced conveying technologies, modern material handling solutions enable cement plants to manage large production volumes while maintaining process stability.
As India’s cement industry continues to expand to meet infrastructure and urban development demands, investments in advanced material handling technologies will become increasingly important. By integrating automation, digital monitoring and energy-efficient systems, cement manufacturers can improve operational performance while supporting the industry’s long-term sustainability and decarbonisation goals.

Kanika Mathur

Concrete

Modernise to Optimise

Published

3 weeks ago

March 18, 2026

admin

Cement plant modernisation is reshaping the industry through upgrades in
kilns, energy systems, digitalisation, AFR integration and advanced material
handling. We explore these technologies that improve efficiency, reduce
emissions, strengthen competitiveness, while preparing the industry for India’s
next phase of infrastructure growth.

India’s cement industry, the world’s second-largest, is undergoing a rapid transformation driven by infrastructure demand, decarbonisation targets and technological advancement. The sector’s installed capacity stood at approximately 668 million tonnes per annum (mtpa) in FY2025 and is projected to reach 915–925 mtap by 2030, supported by large-scale capacity expansions and infrastructure investment cycles, suggests CRISIL Intelligence Industry Report, 2025. At the same time, cement production remains highly energy intensive and contributes about 6 per cent to 7 per cent of India’s total greenhouse gas emissions, making efficiency improvements and modernisation critical for long-term sustainability as stated in CareEdge ESG Research, 2025. As a result, cement manufacturers are investing in advanced kiln technologies, digital monitoring systems, waste heat recovery, alternative fuels, and modern material handling infrastructure to enhance productivity while aligning with global decarbonisation pathways.

Need for modernisation
The need for plant modernisation is closely linked to the sector’s rapid capacity expansion and rising operational complexity. India’s installed cement capacity has grown significantly in the last decade and is expected to exceed 900 mtpa by 2030, driven by demand from housing, infrastructure and urban development projects, as per the CRISIL Intelligence Industry Report, 2025. However, increasing scale also places pressure on energy efficiency, logistics, and production stability. The report also suggests that the cement plants must upgrade equipment and processes to operate at higher utilisation rates, which are projected to reach 75 per cent to 77 per cent by the end of the decade, compared to around 72 per cent to 74 per cent in FY2026.
Environmental imperatives are another major driver of modernisation. Cement manufacturing is responsible for a significant share of industrial emissions because clinker production requires high-temperature processes that depend heavily on fossil fuels. According to CareEdge ESG research, the cement sector contributes 6–7 per cent of India’s total greenhouse gas emissions, with approximately 97 per cent of emissions arising from direct fuel combustion and process emissions in kilns. Consequently, plant modernisation initiatives now focus not only on productivity improvements but also on reducing emissions intensity, energy consumption, and reliance on conventional fuels.
“One of the most impactful upgrades implemented at Shree Cement in the last five years has been the adoption of advanced data management platforms that provide real-time visibility across major process areas. This digital advancement has strengthened plant automation by enabling faster and more accurate responses to process variations while improving the reliability of control loops. Real-time dashboards, integrated analytics and automated alerts now support quicker, data-driven decision-making, helping optimise kiln and mill performance, improve energy control and detect deviations early. By consolidating data from multiple systems into a unified digital environment, the company has enhanced operational consistency, reduced downtime and improved both productivity and compliance. This shift towards intelligent automation and real-time data management has become a key driver of operational excellence and future-ready plant management,” says Satish Maheshwari, Chief Manufacturing Officer, Shree Cement.

Kiln and pyroprocessing upgradation
The kiln remains the technological heart of cement manufacturing, and modernisation efforts often begin with upgrades to pyroprocessing systems. Many older plants in India operate with four- or five-stage preheaters, while modern plants increasingly adopt six-stage preheater and pre-calciner systems that significantly improve heat efficiency and clinker output. These systems enhance heat transfer, reduce fuel consumption, and stabilise kiln operations under high throughput conditions.
Professor Procyon Mukherjee suggests, “Cement manufacturing is, at its core, a thermal process. The rotary kiln and calciner together account for energy consumption and emissions. The theoretical thermal requirement for clinker production is around 1700–1800 MJ per tonne, yet real-world plants often operate far above this benchmark due to inefficiencies in combustion, heat recovery and material flow. Modernisation, therefore, must begin with the
kiln system, and not peripheral automation or
isolated upgrades. The shift from wet to dry process kilns, combined with multi-stage preheaters and precalciners, has already delivered step-change improvements, making dry kilns nearly 50 per cent more energy efficient.”
Recent investment programmes across the industry have included kiln cooler upgrades, advanced burners, and improved refractory materials designed to increase operational reliability and reduce specific heat consumption. Such upgrades are essential because cement production remains highly energy intensive, and continuous efficiency improvements are required to meet global decarbonisation targets. According to the International Energy Agency (IEA) Cement Tracking Report, 2023, the cement sector must achieve annual emissions intensity reductions of around 4 per cent through 2030 to align with global net-zero scenarios.

Energy efficiency and WHRS
Energy efficiency remains one of the most important areas of modernisation in cement manufacturing, given the sector’s heavy reliance on thermal and electrical energy. Modern plants deploy advanced process controls, efficient grinding systems, and improved combustion technologies to reduce specific energy consumption. The adoption of energy-efficient technologies is particularly important in India, where energy costs account for a large share of production expenses. As demand grows and plants expand capacity, improving energy performance becomes essential to maintain competitiveness.
Waste Heat Recovery Systems (WHRS) have emerged as a key solution for improving plant energy efficiency. During cement production, large volumes of high-temperature gases are released from kilns and coolers. WHRS technology captures this waste heat and converts it into electricity, thereby reducing reliance on external power sources. According to energy benchmarking studies for the Indian cement industry, installed waste heat recovery capacity in the sector has reached approximately 840 MW, with an additional potential of around 500 MW states the Green Business Centre, Energy Benchmarking Report, 2023. Several leading producers have already implemented large WHRS installations; for example, UltraTech Cement has deployed systems with around 121 MW of waste heat recovery capacity, reducing carbon emissions by nearly 0.5 million tonnes annually according to the Energy Alternatives India Case Study, 2024.

Integration of AFR
The integration of Alternative Fuels and Raw Materials (AFR) is another critical dimension of cement plant modernisation. AFR refers to the use of industrial waste, biomass, refuse-derived fuel (RDF), and other non-fossil materials as substitutes for conventional fuels such as coal and petcoke. Increasing the use of AFR helps reduce fossil fuel consumption while simultaneously addressing waste management challenges. According to the NITI Aayog Decarbonisation Roadmap, 2026, scaling the use of RDF and other alternative fuels could enable the sector to achieve thermal substitution rates of around 20 per cent in the coming decades.
However, integrating AFR requires significant plant modifications and operational adjustments. Waste-derived fuels often have inconsistent calorific values, higher moisture content, and heterogeneous physical properties compared to traditional fuels. As a result, modern plants invest in advanced fuel preparation systems, dedicated feeding equipment, and automated dosing technologies to ensure stable kiln operation. These upgrades allow plants to maintain consistent clinker quality while increasing the share of alternative fuels in their energy mix.

Digitalisation and smart plant operations
Digitalisation is rapidly transforming cement plant operations by enabling data-driven decision-making and predictive maintenance. Industry 4.0 technologies such as IoT sensors, artificial intelligence (AI), and advanced analytics are now used to monitor equipment performance, optimise process parameters, and anticipate maintenance requirements. These digital tools enable plant operators to detect early signs of equipment failure, minimise unplanned downtime, and improve operational efficiency. Predictive maintenance systems, for example, analyse vibration, temperature, and acoustic signals from rotating equipment to identify potential faults
before they escalate into major breakdowns. Digital twins and integrated control systems further allow operators to simulate plant performance under different scenarios and optimise production strategies. Such technologies are becoming increasingly important as cement plants operate at larger scales and higher levels of process complexity.
Maheshwari also adds, “Plant modernisation is also increasingly central to the global competitiveness of Indian cement manufacturers. As cost pressures rise across energy, logistics and regulatory compliance, modern plants offer the structural efficiency required to operate reliably and competitively over the long term. Technologies such as AI-driven Advanced Process Control (APC) integrated with real-time data systems are emerging as essential investments for the future. These platforms use predictive algorithms, machine learning and live process inputs to optimise kiln, mill and utility operations with greater precision than traditional control systems. By continuously analysing variations in feed chemistry, temperature profiles, energy demand and equipment behaviour, APC enables stable operations, lower specific energy consumption, reduced emissions and improved product consistency. As regulatory expectations tighten and plants pursue higher efficiency with lower carbon intensity, AI-enabled APC will play a crucial role in strengthening automation, enhancing decision-making and ensuring long-term operational resilience.”

Modern material handling and logistics
Material handling systems play a critical role in ensuring smooth plant operations and efficient logistics. Modern cement plants rely on advanced conveying systems, automated stockyards, and digital dispatch platforms to manage the movement of raw materials, clinker, and finished cement. Long-distance belt conveyors and pipe conveyors are increasingly replacing truck-based transport between quarries and plants, reducing fuel consumption, dust emissions, and operational costs. Automated stacker-reclaimers ensure consistent blending of raw materials,
which improves kiln stability and clinker quality. Meanwhile, advanced packing and dispatch systems equipped with high-speed rotary packers and robotic palletisers enhance throughput and reduce manual labour. These technologies allow cement plants to optimise logistics efficiency while supporting higher production capacities.

Emission control and environmental compliance
Environmental compliance has become a central focus of cement plant modernisation as regulators and investors place greater emphasis on sustainability performance. Modern plants deploy advanced emission control technologies such as high-efficiency bag filters, electrostatic precipitators, and selective non-catalytic reduction systems to reduce particulate matter and nitrogen oxide emissions.
Sine Bogh Skaarup, Vice President, Head of Green Innovation and R&D, Fuller Technologies says, “One of our key focus areas is decarbonisation. We help cement producers reduce CO2 and overall carbon emissions. We offer alternative fuel solutions and calcined clay technologies to enable the production of LC3 cement, which play a significant role in decarbonising the cement industry. By combining alternative fuels and calcined clay solutions, CO2 emissions can be reduced by up to 50 per cent, making this a highly impactful approach for sustainable cement production.”
Continuous emission monitoring systems are increasingly used to track environmental performance in real time and ensure compliance with regulatory standards. In addition to air pollution control, cement companies are also investing in water recycling systems, renewable energy integration, and carbon reduction initiatives. These measures are essential for aligning the sector with national climate goals and improving the environmental footprint of
cement manufacturing.

Economic benefits and future outlook
Beyond environmental and operational advantages, cement plant modernisation also delivers significant economic benefits. Energy efficiency improvements, digital process optimisation, and advanced material handling systems reduce operating costs and improve asset utilisation. Waste heat recovery and alternative fuels help lower fuel expenditure and reduce exposure to volatile fossil fuel markets. As the industry expands capacity to meet growing demand, modernised plants are better positioned to achieve higher productivity and maintain profitability. The long-term outlook for the sector remains positive, with India expected to continue large-scale infrastructure investments in roads, housing, railways, and urban development.
Milan R Trivedi, Vice President – Projects, Prod & QC, MR, Shree Digvijay Cement, says, “The main focus in case of modernisation projects drives through the investment decision, which is mainly based on IRR and impact on overall efficiency improvement, cost optimisation and improvement in reliability. However, there are certain modernisation, which has high impact on environmental impact, statutory requirements, etc. has higher priority irrespective of ROI or payback period.”
“The energy efficiency and reliability investment projects generally provide fast return on investment whereas strategic, digitalisation and environmental investment projects provide long term and compounded benefits. Typical modernisation investment projects are decided with IRR of about > 20 per cent, payback period of typically 2-3 years for fast-track projects,” he adds.
In this context, modernisation will remain a key strategic priority for cement manufacturers seeking to maintain competitiveness in an increasingly sustainability-focused market.

Conclusion
The modernisation of cement plants is no longer a purely technical upgrade but a strategic transformation that reshapes how the industry operates. As India’s cement sector expands capacity toward the next growth cycle, improvements in energy efficiency, digitalisation, alternative fuels and advanced logistics will determine the competitiveness of individual plants. Modern technologies allow producers to operate at higher productivity levels while simultaneously reducing energy consumption and emissions intensity.
Looking ahead, the pace of technological adoption will play a decisive role in shaping the future of
the cement industry. Companies that successfully integrate modern equipment, digital systems, and sustainable production practices will be better positioned to meet rising infrastructure demand while aligning with global climate commitments. In this evolving landscape, plant modernisation stands as the cornerstone of both operational excellence and environmental responsibility.