Economy & Market
Budget Impact | Cement Industry Speaks Out
Published
9 years agoon
By
admin
Various corporate leaders, analysts and industry associations spoke to INDIAN CEMENT REVIEW after the Union Budget was presented to offer their views on how the recommendations will impact the cement industry.
Dr S Chouksey, President, Cement Manufacturers’ Association
I congratulate the Hon’ble Finance Minister Arun Jaitley on behalf of the Indian cement industry for presenting a Budget which is high on reforms, and will boost the rural economy and uplift the weaker sections of society. The government’s bold steps to usher in poll reforms, curb tax evasion, and the further push to the digital economy are all forward looking. The cement industry is buoyant with the government’s commitment to provide 10 million houses to the homeless or those with kachha houses. The granting of infrastructure status to affordable housing is yet another step which would be looked at positively by the cement industry, though we were expecting the housing sector in general would be granted infrastructure status.
Industry’s concerns on high taxation on the sector, of course, remain and is expected that they will definitely be taken care of while fixing the rates in the GST regime. We welcome the government’s other policy measures, including increasing the fund alloca?tion for infrastructure and particularly that of providing mason trai?ning to 5 lakh persons by 2022. This will increase employment opportu?nities and also bring in more efficiency to the construction sector. The target of 100 per cent rural electrification by April 2018 will bring in development oppor?tunities right up to the core of rural India. Similarly, the thrust on rail mo?dernisation and station redevelopment would also boost the construction sector. This sector has the potential for creation of employment opportunities and the government’s various steps to boost the construction sector will neutralise the unemployment created in some medium and small scale industries due to demonetisation.
Vaibhav Agarwal, Vice President – Research, PhillipCapital
In our opinion, this Budget is the most stru?cturally positive one for the cement sector in the last decade. Although there were no direct announcements by the Finance Minster for the cement sector, a number of his announcements will lead to increased and sustained consumption of cement.
10 million houses by 2019 for the houseless
-This provision will lead to incremental cement demand of ~75 million tonnes over the next two-three years.
100 per cent rural electrification by 1st May 2018
-This implies deeper penetration of development opportunities in rural India in the form of construction of houses and roads; hence a structural positive.
Continued focus on sanitation
-Sanitation coverage in rural India is currently 60 per cent. The budget commentary remained very positive on sanitation projects. In our recent ground checks, we found that sanitation projects are one of the key demand drivers for cement. The continued thrust on such projects will help boost cement demand.
Higher investment in affordable housing and affordable housing being granted ‘Infrastructure’ status will translate into more cement consum?ption for such projects. Grant of infrastructure status means more participation on the supply side by construction companies/contractors/builders and faster execution of such projects.
Fostering a conducive labour environment
Labour issues are one of the key ones in construction projects. Continuous availability of labour is frequently a problem at most sites (most labour is generally migrant). The government’s focus on developing a conducive labour environment will mean labour issues will be sorted out to a large extent, implying smooth execution of projects at construction sites with steady cement consumption. This will also mean the other regular labour concerns for contractors (wages, job benefits) are resolved, which will ameliorate labour migration concerns. In addition, there are a few other announcements in the Budget which will have a positive impact on the industry:
The thrust on rail modernisation/station redevelopment projects and 25 stations going in for redevelopment will lead to material cement consumption.
Similarly, the introduction of the Metro Rail Act and various Metro rail policies will lead to faster and structured execution of such projects, implying better visibility of cement demand.
Further, the Centre has increased investments in the roads sector and 2,000 km of coastal roads have been identified for development. This will lead to more cement demand from road projects. The various airport upgradation/maintenance projects may imply increased cement consumption. Consumption may be even higher if upgradation work involves runways.
Amendment of the Negotiable Instruments Act, 1881
This was one of the key demands from north Indian channel partners and distributors. Northern India is a largely a cash-and-carry economy and issuing post-dated cheques is a normal practice. Trade associations in these regions had approached the government for these amendments.
With this development, the supply chain should be more comfortable with such instruments. We found north India averse to digital wallets and the swipe machine culture, given the 1-2 per cent transaction charges involved. Change in dynamics of affordable housing (30/60 sq mt carpet from 30/60 sq mt built-up area) would lead to larger sizes of such houses, which in turn will mean higher cement consumption.
The ‘Notional Rent Income’ tax on unsold inventory for builders, post one year of receiving the commencement certificate if such houses remain unsold/unoccupied, will means correction in real estate prices/rentals, implying quicker-than-anticipated (though lower) cash flows to builders. The builder will be able to execute projects faster and transparently, implying better cement demand.
Exemption of capital gains tax where land is being pooled for the creation of Andhra Pradesh’s capital city if the person was holding the land as on 2 June, 2014, implies more transparent and faster execution of the capital city and quicker-than-anticipated cement demand. India Cements will be the key gainer followed by Dalmia Bharat, Ramco and other southern cement companies.
Reduction in holding period for considering capital gains tax to two years from three years and change of base year for indexation to 2001 from 1981 reduces the capital gains tax liability. This will mean quicker decisions in the real-estate markets to buy/sell (as the holding period comes down) and will also prompt builders for faster execution of projects, implying more sustained demand for cement from the real estate sector.
The increase in disposable income by a marginal reduction in tax rates in the Rs 2,50,000-Rs 5,00,000 tax bracket to 5 per cent from 10 per cent is a sentiment booster for those within this bracket, aspiring to buy new houses.
In short, the Budget’s overall impact on the cement sector is positive. All cement companies are winners, especially India Cements, Dalmia Bharat, JK Cement, JK Lakshmi Cement and UltraTech Cement.
Sameer Nagpal, CEO – Refractories, Dalmia Bharat Group
For refractories, which are the backbone for core manufacturing sectors like steel and cement, increase in expenditure allocation, particularly in railways, highways and housing should help build demand. I was expecting more for the manufacturing sector in terms of reforms and some specific measures to safeguard domestic manufacturing from cheaper, unreliable imports and that has not happened. Overall, it is a mixed Budget.
Crisil Research
The Budget has had a positive impact on the cement sector with infrastructure investments and affordable housing to drive demand.
Here are the key Budget proposals:
Pradhan Mantri Awas Yojana (PMAY) allo?cation increased by 39 per cent to Rs 290 billion;
Allocation from Ministry of Rural Development increased by 10 per cent to Rs 1.05 trillion in FY18;
Investments in cement-intensive infrastructure segments (excluding power) are up 9.8 per cent to Rs 4.2 trillion. The total outlay towards National Highways is at Rs 1.24 trillion, up 11.1 per cent over the previous fiscal’s revised estimates;
Affordable housing to be accorded infrastructure status.
Crisil’s view:
The increased government spending on PMAY will provide an impetus to the housing segment, which has been fairly muted over the last few years. Further, grant of infrastructure status to affordable housing would facilitate easier access to low-cost finance and thereby support demand.
A 9.1 per cent increase in allocation to rural development and 44 per cent rise in PMAY-Gramin is likely to catalyse growth in cement demand from rural housing, which typically constitutes 35 per cent of cement demand.
Further, increased government spending on infrastructure, especially cement-intensive sectors such as National Highways (up by 11.1 per cent), metros (15 per cent ), and other schemes (e.g., Swachh Bharat up by 27 per cent ), will augment cement sales.
Sundeep Kumar, Executive Director – Corporate Affairs & Communications, Dalmia Bharat Group
It is a positive and decisive Budget coming especially against the backdrop of the Government’s boldest measure of demonetisation. The Finance Minister has spelled out a forward-looking regimen for the infrastructure sector with a total allocation of up to Rs 3.96 trillion. Giving industry status will greatly ease financing for affordable housing. With the Metro rail emerging in cities and railway lines of 3,500 km to be commissioned next, along with tier-II city airports, there is a greater scope for public- partnership to thrive, which will aid construction activity and lead to a boom in demand for cement as well.
Further, enhancing expenditure on National Highways will give the much needed fillip to the cement industry. Overall, with a focus on rural and agricultural development, housing, clean energy, elimination of poverty, providing basic necessities to the farmers, waivers for senior citizens in government schemes and a promise of aiding the Skill India and Digital India campaigns, the government has presented an all-inclusive Budget this time around. On tax reforms, there has been no relief or relaxation on corporate tax for larger corporates, which is disappointing.
Shishir Baijal, Chairman & Managing Director, Knight Frank India
This has been one of the path-breaking bud?gets with far-reaching changes, especially for the real estate sector. It is positive that the real estate sector has come in the central spectrum of the Union Budget. This has come at a time when the beleaguered sector has been looking at measures to boost the sentiments. The real estate sector, which was the hardest hit by demonetisation move, will be one of the major beneficiaries of this Budget.
Prudence in fiscal discipline is welcome and will encourage the RBI to look at a lower interest rate regime that will provide the much-needed fillip to this stressed sector. Increased focus on infrastructure, especially construction of new roads, improvement of existing roads and coastal connectivity, will go a long way to benefit the real estate sector.
Increase in allocation of funds under PMAY (Pradhan Mantri Awas Yojana) shows the focus of the government towards making ‘Housing for All’ a reality by 2020. Providing infrastructure status to affordable housing, a long-standing demand of the real estate industry, will not only bring the cost of financing down, but will also open up additional avenues for developers to raise funds. We believe that the shift in eligibility criteria for affordable housing from built-up area to carpet area will increase the unit size by 20-30 per cent and will offer home buyers the benefit of owning larger units. This will also encourage leading real estate players to enter the affordable housing segment.
The move to reduce the tenure of the Long Term Capital Gains Tax from three years to two years is extremely welcome and will help the marketability of real estate as an asset class. Changes in the taxation aspect of JDAs (Joint Development Agreements) will greatly encourage more land owners to partner with developers that will benefit the real estate developers, and in turn is likely to benefit the end consumers.
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Economy & Market
SEW-EURODRIVE India Opens Drive Technology Centre in Chennai
Published
2 weeks agoon
March 25, 2026By
admin
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.
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
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.
- Kanika Mathur
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