Economy & Market

The core sector in focus: Mean reversion

Published

6 years ago

January 8, 2020

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Indian economy has shown striking resilience to revert to the mean, although it is early days to make any long term projection. But in the short term, the months of May, June and July have shown results that demonstrate the ability to make an economic recovery despite the headwinds that stem from the propagation of the Coronavirus in almost all corners of India.

It would be prudent to first see the state of the core sector. Monthly Core sector Index (which tracks monthly growth) has moved positively starting from a contraction of 37 per cent in April 2020, to 22 per cent in May and 15 per cent in June. So as we read June numbers it is in fact a recovery of 22 per cent over the steep drop in April, when the core sector Index fell to the crevice in absence of working days for production or sales.

Among the core sector, cement index showed the maximum rebound, from a sharp drop of 85.3 per cent in April 2020 (virtually the entire month the production stopped), May rebounded to 21.4 (negative) and June came back to 6.9 per cent (negative). Negative 6.9 per cent compares with negative 1.9 per cent in June 2019. Among the core sectors, only fertilizer (+4.2 per cent) and crude oil (-6 per cent) has fared better for the month of June.

To see some of the complementary sectors, coal, steel and electricity show some very mixed results. Coal is showing a very steady negative growth hovering around 15 per cent throughout these three months, while steel made a recovery from a steep fall of contraction of 78.7 per cent in April to negative 33.8 per cent in June. Electricity seems to be mode steady in its modest recovery from a contraction of 23 per cent in April to 11 per cent in June.

Core sector production growth has several components to be looked at, including other drivers for example in fertilizer, which due to the onset of the Kharif season coupled with higher distribution with easing of lockdown measures have aided output.

The Oil and natural gas sector have many other issues to contend with like ageing of assets, high prices of end use fuel dampening demand or the structural factors in Natural Gas, where the contraction is a 15 month consecutive phenomenon due to restricted gas off-take by consumers.

Minus the coronavirus, the core sector was showing an upward trend till march, barring a few, although the trend showed dampening due to some structural factors, some of which are related to also demand side of the story.

To project anything forward from this June series would be fraught with risks as we now move to the monsoon season and some sectors will have natural dampening of demand thus taming output, while the virus moves to an unknown trajectory. Some risks are multiplicative, while some are additive, how the economy wades through it will depend on how the economy tackles the virus as part of the economic rebound, not treating it as an exclusion (the treatment cannot be either or).

Construction and infrastructure hold the center piece of the discourse on core sector and this would mean solving the supply side, where labor remains the biggest influence for things to take shape. But actually the solution seems plausible that if those who could be vulnerable to contracting could be segregated and the rest could insulate themselves with a mandatory mask and strict regimen, the activities actually could be brought back to normal, albeit at a slightly reduced level. If the former, segregation through contact tracing and testing, is not well orchestrated among the various constituencies, while the latter, those who should protect themselves do not follow the rules, the combined result will continue to lead to the current trajectory of the virus.

The core sector also must have the solutions to the migrant labor problem, where the activities must reach a threshold to create the reverse movement of skilled labor in larger numbers. This remains a crucial result to watch, could the core sector create its own solutions, this is where some are doing better than the others, which includes solutions for distribution and logistics as well.

ABOUT THE AUTHOR:
Procyon Mukherjee works as Chief Procurement Officer at LafargeHolcim India. The ideas presented are his personal and have no connection to the beliefs of the company where he works.

Economy & Market

TSR Will Define Which Cement Companies Win India’s Net-Zero Race

Published

5 days ago

April 27, 2026

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Jignesh Kundaria, Director and CEO, Fornnax Technology

India is simultaneously grappling with two crises: a mounting waste emergency and an urgent need to decarbonise its most carbon-intensive industries. The cement sector, the second-largest in the world and the backbone of the nation’s infrastructure ambitions, sits at the centre of both. It consumes enormous quantities of fossil fuel, and it has the technical capacity to consume something else entirely: the waste our cities cannot get rid of.

According to CPCB and NITI Aayog projections, India generates approximately 62.4 million tonnes of municipal solid waste annually, with that figure expected to reach 165 million tonnes by 2030. Much of this waste is energy-rich and non-recyclable. At the same time, cement kilns operate at material temperatures of approximately 1,450 degrees Celsius, with gas temperatures reaching 2,000 degrees. This high-temperature environment is ideal for co-processing, ensuring the complete thermal destruction of organic compounds without generating toxic residues. The physics are in our favour. The infrastructure is not.

Pre-processing is not the support act for co-processing. It is the main event. Get the particle size wrong, get the moisture wrong, get the calorific value wrong and your kiln thermal stability will suffer the consequences.

The Regulatory Push Is Real

The Solid Waste Management (SWM) Rules 2026 mandate that cement plants progressively replace solid fossil fuels with Refuse-Derived Fuel (RDF), starting at a 5 per cent baseline and scaling to 15 per cent within six years. NITI Aayog’s 2026 Roadmap for Cement Sector Decarbonisation targets 20 to 25 per cent Thermal Substitution Rate (TSR) by 2030. Beyond compliance, every tonne of coal replaced by RDF generates measurable carbon reductions which is monetisable under India’s emerging Carbon Credit Trading Scheme (CCTS). TSR is no longer a sustainability metric. It is a financial lever.

Yet our own field assessments across multiple Indian cement plants reveal a sobering reality: the primary barrier to scaling AFR adoption is not waste availability. It is the fragmented and under-engineered pre-processing ecosystem that sits between the waste and the kiln.

Why Indian Waste Is a Different Engineering Problem

Indian municipal solid waste is not the material that imported shredding equipment was designed for. Our waste streams frequently exceed 40 per cent to 50 per cent moisture content, particularly during monsoon cycles, saturated with abrasive inerts including sand, glass, and stone. Plants relying on imported OEM equipment face months of downtime awaiting proprietary spare parts. Machines built for segregated, low-moisture waste fail quickly and disrupt the entire pre-processing operation in Indian conditions.

The two most common failures we observe are what I call the biting teeth problem and the chewing teeth problem. Plants relying solely on a primary shredder reduce bulk waste to large fractions, but the output remains too coarse for stable kiln combustion. Others attempt to use a secondary shredder as a standalone unit without a primary stage to pre-size the feed, leading to catastrophic mechanical failure. When both stages are present but mismatched in throughput capacity, the system becomes a bottleneck. Achieving the 40 to 70 tonnes per hour required for meaningful coal displacement demands a precisely coordinated two-stage process.

Engineering a Made-in-India Answer

At Fornnax, our response to these challenges is grounded in one principle: Indian waste demands Indian engineering. Our systems are built around feedstock homogeneity, the holy grail of kiln stability. Consistent particle size and predictable calorific value are the foundation of stable kiln combustion. Without them, no TSR target is achievable at scale.

Our SR-MAX2500 Dual Shaft Primary Shredder (Hydraulic Drive) processes raw, baled, or loosely mixed MSW, C&I waste, bulky waste, and plastics, reducing them to approximately 150 mm fractions at throughputs of up to 40 tonnes per hour. The R-MAX 3300 Single Shaft Secondary Shredder (Hydraulic Drive), introduced in 2025, takes that primary output and produces RDF fractions in the 30 to 80 mm range at up to 30 tonnes per hour, specifically optimised for consistent kiln feeding. We have also introduced electric drive configurations under the SR-100 HD series, with capacities between 5 and 40 tonnes per hour, already operational at a leading Indian waste-processing facility.

Looking ahead, Fornnax is expanding its portfolio with the upcoming SR-MAX3600 Hydraulic Drive primary shredder at up to 70 tonnes per hour and the R-MAX2100 Hydraulic drive secondary shredder at up to 20 tonnes per hour, designed specifically for the large-scale throughput that higher TSR ambitions require.

The Investment Case Is Now

The 2070 Net-Zero target is not a distant goal for India’s cement sector. It starts today, with decisions being made on the plant floor.

The SWM Rules 2026 are already in effect, requiring cement plants to replace coal with RDF. Carbon credit markets are opening up, and coal prices are not going to get cheaper. Every tonne of coal a cement plant replaces with waste-derived fuel saves money on one side and generates carbon credit revenue on the other. Pre-processing infrastructure is no longer just a compliance requirement. It is a business investment with a measurable return.

The good news is that nothing is missing. The technology works. The waste is available in every Indian city. The government has provided the policy direction. The only thing standing between where the industry is today and where it needs to be is the commitment to build the right infrastructure.

The cement companies that move now will not just meet the regulations. They will be ahead of every competitor that waits.

About The Author

Jignesh Kundaria is the Director and CEO of Fornnax Technology. Over an experience spanning more than two decades in the recycling industry, he has established himself as one of India’s foremost voices on waste-to-fuel technology and alternative fuel infrastructure.

Concrete

WCA Welcomes SiloConnect as associate corporate member

Published

3 weeks ago

April 13, 2026

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The World Cement Association (WCA) has announced SiloConnect as its newest associate corporate member, expanding its network of technology providers supporting digitalisation in the cement industry. SiloConnect offers smart sensor technology that provides real-time visibility of cement inventory levels at customer silos, enabling producers to monitor stock remotely and plan deliveries more efficiently. The solution helps companies move from reactive to proactive logistics, improving delivery planning, operational efficiency and safety by reducing manual inspections. The technology is already used by major cement producers such as Holcim, Cemex and Heidelberg Materials and is deployed across more than 30 countries worldwide.

Concrete

TotalEnergies and Holcim Launch Floating Solar Plant in Belgium

Published

3 weeks ago

April 13, 2026

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TotalEnergies and Holcim have commissioned a floating solar power plant in Obourg, Belgium, built on a rehabilitated former chalk quarry that has been converted into a lake. The project has a generation capacity of 31 MW and produces around 30 GWh of renewable electricity annually, which will be used to power Holcim’s nearby industrial operations. The project is currently the largest floating solar installation in Europe dedicated entirely to industrial self-consumption. To ensure minimal impact on the surrounding landscape, more than 700 metres of horizontal directional drilling were used to connect the solar installation to the electrical substation. The project reflects ongoing collaboration between the two companies to support industrial decarbonisation through renewable energy solutions and innovative infrastructure development.