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Union Budget 2020-21 | Remedy fails to match malady

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As the Union Budget 2020-21 failed to enthuse different segments of investors and consumers, the question that remains is: How long to wait for economic revival?

The sum and substance of reactions to the Union Budget 2020-21 presented by the Finance Minister Nirmala Sitharaman was that it has belied the expectations that there will be some "big bang" measures to stimulate demand and investments in the sagging economy, and that this was a missed opportunity to push some major economic reforms.

This year’s budget has given thrust to agriculture, irrigation and rural development, infrastructure, skill development and the beleaguered financial sector. There were some measures to support MSME sector and affordable housing too. The idea was to touch upon every aspect that could help revive the economy, with an expectation that at least a few of them will click. However, those ideas were not backed by sufficient resources, ultimately due to existing funds crunch. Though the Finance minister claimed to have announced some personal tax concessions, they are unlikely to make big difference in their disposable incomes and overall consumer demand.

The budget has also proposed to tap global sovereign funds to finance infrastructure projects, mainly due to drying up of long term domestic sources and fiscal constraints. Taking a leaf from the US president Donald Trump, the budget has hiked customs duties to protect the domestic industry from external competition. "There is some support to growth, but nothing substantial in the short term. However, the government is still eyeing the long term and has, therefore, pushed capex (the government’s capital expenditure on infra etc.). The multiplier impact of this will be positive but lagged,"said leading rating firm Crisil, in its report on budget.

The economists and analysts argued for employing all means, including deviating from fiscal roadmap in the short term, to pump prime the economic activity, but that was not to be. Tough increasing the fiscal deficit target by 0.5 per cent to 3.5 per cent deviating from its roadmap, a recent study by former Economic Advisor to the Finance Ministry Dr Arvind Subramanian, estimates the fiscal deficit figure at 5.5 per cent, after including deals kept out of government accounting.

Recently, referring to such off-balance sheet expenses resorted to by the government, its auditor, Comptroller and Auditor General of India (CAG), advised the government to make thorough disclosure on such liabilities made by the government and public enterprises to the parliament, to impart more sanctity to its accounting practices.

The government had been in denial mode of economic slowdown for some time, the latest statistics baring the ominous state of the economy prove that it hs come to terms with the reality.

Infra push
Infrastructure push given by the budget is expected to provide support to Cement consumption, albeit not in a big way. "The demand for the commodity (cement) will pick up due to infrastructure, housing and rural development related announcements," said CARE Ratings in its report, while terming it a "Positive" impact of the budget.

Adding 100 more airports by 2024, Rs 1.7 lakh crore allocation for transport infrastructure in 2020-21, development of five new smart cities and continuation of incentives to affordable housing are some of the new proposals in the budget. In the previous budgets the government has already announced its grand infrastructure plans National Infrastructure Pipeline & Accelerated Development of Highways and increased focus on inland water ways.

However, Crisil has given "thumbs down"on the sector citing falling allocations for the sector in the coming fiscal and reduction in off-budget allocations. "For the first time in years, overall infrastructure capex has fallen to Rs 4.7 lakh crore for fiscal 2021 from Rs 5.1 lakh crore in fiscal 2020 RE (revised estimates). Moreover, a 16 per cent reduction in IEBR (Internal and Extra Budgetary Resources) implies a higher burden on budgetary support and strain on government finances. Lower spend on infrastructure would also lower chances of revival in allied sectors, particularly steel and cement."

The past implementation pace on the grand plans the government had announced in the past like National Infrastructure Pipeline and Accelerated Development of Highways, on the other hand, have nothing to boast about. The national infrastructure pipeline of Rs 103 lakh crore over fiscal 2020-25 includes investments in core and allied infrastructure sectors. Excluding allied sectors such as industrial, digital, and social infrastructure, the annual core infrastructure investment amounts to Rs 15 lakh crore, or Rs 90 lakh crore over the five-year period."Of this, Rs 4.7 lakh crore would come from the Centre and Rs 2.6 lakh crore from states, leaving ~52% to the private sector. However, considering the limited number of private players and low risk-appetite of banks, private participation is a key monitorable in achieving these targets,"Crisil added.

Allocation for railways has increased by a meagre three per cent to Rs 1.6 lakh crore. "But this falls way short of the Rs 3.8 lakh crore annual investment envisaged as part of Rs 50 lakh crore investment over fiscals 2018-30. A capex of Rs 6 lakh crore was incurred between fiscals 2016 and 2020, missing the Rs 8.5 lakh crore target set for this period," Crisil pointed out.

However, CARE Ratings billed the budget impact on railways as "positive", stating, "Stable Budget for Railways with similar capital expenditure allocation and opening up of private investment for railway infrastructure creation."Setting up large solar power capacity alongside rail track to optimise electrification cost and railway electrification of 27000 km track are also positives for the sector.

The government, in August 2014, had opened up few activities (comprising suburban corridor, high speed train project, railway electrification, passenger terminals etc.) of Indian Railway for FDI and the budget re-emphasises Government focus on same. The capital outlay allocated towards the Roads and Highway sector is Rs 0.77 lakh crore. "The allocation is not in lines with the NIP where the centre is involved in providing 25 per cent of the investment,"says CARE Ratings. The budget also proposed to monetise at least 12 lots of highway bundles of over 6,000 Km before 2024, but CARE Ratings says the timely fructification of this proposal holds the key for the sector.

Though Bullet Train project figured again in the budget, it has been a laggard in implementation. While it is envisaged to operate 15 passenger trains and re-development of four stations on PPP basis, the low rate of success in the past does not inspire confidence.

In line with the budget thrust to rural infrastructure, Prime Minister Gram Sadak Yojana (PMGSY) allocations were up 39 per cent to 19,000 crore, even as achievement ratio has fallen by 74 per cent in 2019-20 from 94 per cent in 2016-17, making the budgeted target for fiscal 2021 aggressive. Moreover, rural road construction targets over the next five years under PMGSY III are lower at 125,000 km, compared with 218,000 km constructed over the past five years.

Vimal Kejriwal, MD & CEO of KEC International says, "The budget’s infra focus is expected to provide a significant fillip to KEC. Allocation towards power and renewable energy, and transport infrastructure, upgradation of stations and developing solar in railways, setting up of 100 new airports, 5 new Smart cities and linking one lakh gram panchayats with BharatNet augurs well for our businesses."

CRISIL Research’s analysis of 106 airports already awarded under UDAN reveals that 62 of these remain non-operational due to lack of basic airport infrastructure. An estimated capex of Rs 4,500-5,000 crore is needed for their revival. Thus, plan for 100 more airports would be achieved only with a lag.

Overall, tax exemptions for sovereign funds to increase foreign investor participation across infrastructure sectors is a positive with investments already visible in roads, power and airports.

Power sector too has got some nudge in the budget. Sabyasachi Majumdar, Senior Vice President & Group Head, Corporate Ratings, ICRA Ltd., says, "Shutting down of old thermal power plants will shift generation to newer generation thermal projects and thus provide a moderate boost to their plant load factors (PLF). Abolition of dividend distribution tax and lower tax rates will encourage fresh investments in the power sector, especially renewable energy and transmission sectors."

Housing
Budgetary allocation for Pradhan Mantri Awas Yojana (PMAY) at Rs 27,500 crore is up by 9 per cent over the last fiscal’s RE. PMAY-Urban has an overall target of constructing 1.12 crore houses by 2022. Of these, 1.03 crore houses have been sanctioned as of January 2020. PMAY-Rural has an overall target of 2.95 crore, of which about 0.9 crore units stand completed as of December 2019.

From the affordable housing buyer’s point of view, the additional deduction of up to Rs 1.5 lakh for interest paid on loans taken has now been extended till March 31, 2021.

Hardik Agrawal, CEO of Radha Madhav Developers says, "This budget stimulates the supply of affordable houses a tax holiday is provided on the profits earned by developers of affordable housing project approved by 31st March, 2020. Even in order to minimize suffering in real-estate transactions and provide relief to the sector, FM proposed to increase the limit of transaction from 5% to 10% (of deviation from circle price for tax scrutiny). Overall this was a consoling budget."

Malady & remedy
What is it that made this budget special? It has come in the backdrop of growth deceleration for six consecutive quarters driven by low growth in consumption and investment. The burden of two failed budgets presented in 2019 – before and after the general elections – were also weighing on the Finance Minister. Pre-poll sops were targeted towards the poor and farmers, while the post-poll budget targeted at the companies and businesses.

A drop in private consumption growth played a big role in bringing down GDP growth to an 11-year low. Private consumption growth slowed to 5.8 per cent in fiscal 2020, from 7.2 per cent in fiscal 2019. A dent to incomes, declining household savings ratio and higher household leverage have kept the consumer’s risk aversion high.

Crisil in its analysis of demand side impact of the budget, projected that some support to rural demand was expected from higher allocation to schemes like PMGSY and PMAY, which will augment incomes. "PM Kisan spending for fiscal 2021 has been maintained at the previous fiscal’s budgetary level, but the focus should be on ensuring that part of the amount does not remain unspent," Crisil suggested. Investment growth dropped to one per cent in fiscal 2020 from 9.8 per cent in fiscal 2019. While private investments have been weak, the government’s ability to fund capex also remains constrained. The budget focus on infrastructure spending will support investment to an extent as central PSU investments are projected to decline, says Crisil. However, the rating agency did not exude the same kind of confidence in growth of private investments during in the next fiscal.

Government consumption spending, mostly on the social sector schemes, supported growth in fiscal 2020. "The government has continued to focus on social sector schemes (including those that augment rural incomes, such as PMGSY, PMAY, NREGA and PM Kisan)," Crisil added.

The budget’s support to MSMEs is a "mild positive" for exports going ahead, says Crisil. Decelerating global growth, falling trade intensity, and uncertainties from the US-China trade war are hurting India’s exports. India’s exports is estimated to fall 2 per cent in fiscal 2020, compared with a growth of 12 per cent in fiscal 2019.

However, the budget is a mixed bag for the current problem in the financial sector. While bringing some relief to the beleaguered non-banking finance companies (NBFCs) by expanding scope for recovery of their bad loans is positive, seeking to remove exemptions in personal income-tax is expected to reduce savings and insurance premiums. However, increasing the bank deposit insurance coverage from Rs one lakh to Rs 5 lakh is expected to increase the confidence of bank depositors, which touched its ebb with the recent failure of co-operative banks.

Worst is not closer than it appears
For cement industry to thrive the overall economy has to be robust. The budget has pulled some levers feebly, that may not be enough to spur the economic growth pace. When private sector is not forthcoming to make investment, it is incumbent on the government and the Reserve Bank of India (RBI) to take steps to revive the economy. Even as RBI had cut the repo rate cumulatively by 135 basis points (bps) through calendar 2019, banks have cut lending rates only by just 40-50 bps.

Crisil says, "In the absence of growth kickers, growth pick-up in fiscal 2021 is expected to be largely led by the base effect and supported by somewhat better farm income (led by a good rabi crop) and the delayed impact of monetary easing. Critical to this forecast is the assumption of a normal monsoon in calendar 2020 and benign global crude oil prices."

Kapil Gupta of Edelweiss Research says, "Overall, from a business cycle standpoint, aggregate fiscal push is missing. We think, given weak demand, consolidation could have waited. Thus, the economy, at best, will see a modest bounce aided by liquidity easing, normalisation in farm cash flows amid rising food inflation, and stabilisation in exports. But the virtuous economic cycle may still be distant."

This kind of consensus among analysts leave us with the question: How long we have to wait to see economic revival?

Infrastructure in Budget

  • 100 more airports to be developed by 2024 to support UDAAN Scheme
  • Rs 1.7 lakh crore allocated towards transport infrastructure
  • Development of 5 new smart cities
  • Further incentivising and boosting affordable housing
  • Increased focus on inland water ways
  • Allowing sovereign funds to invest in infrastructure 15 new passenger trains through PPP route

    Past announcements continued:

  • Grand plans announced in the past: National Infrastructure Pipeline (NIP) & Accelerated Development of Highways
  • Provision of Rs. 22,000 cr already provided to support the NIP, to cater to equity support to infra finance companies like IIFCL and a subsidiary of NIIF
  • Bullet train project between Mumbai and Ahmedabad
  • Taxation Measures
    For corporates/ cooperative societies

  • Concessional tax rate for cooperative societies proposed (from 30% to 22%)
  • Concessional tax rate of 15% to new domestic companies extended to electricity generation companies
  • Dividend distribution tax removed; dividend will now be taxed in the hands of individuals
  • Tax concession for sovereign wealth funds of foreign governments

  • – BS SRINIVASALU REDDY

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    Economy & Market

    Fornnax Names Lukas Baur as Authorised Service Partner to Bolster EU Operations

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    Strapline: Fornnax Technology has appointed NOBA Maschinenservice’s Lukas Baur as its authorised service partner for the European Union, strengthening its commitment to delivering fast, reliable, and localised after-sales support across the region.

    Fornnax Technology, a leading manufacturer of industrial shredding solutions, has announced the appointment of Mr. Lukas Baur of NOBA Maschinenservice as its authorised service partner for the European Union. The partnership, formalised under the authorisation of Fornnax CEO Mr. Jignesh Kundaria, reinforces the company’s commitment to providing dependable, localised service support to its expanding customer base across Europe.

    Strengthening Service Through Proven Expertise

    With over two decades of experience in servicing, maintaining, and overhauling industrial shredders, Mr. Baur brings extensive technical expertise to the partnership. His capabilities span welding, hardfacing, shaft and knife rebuilding, complex assembly, hydraulics, and complete electrical engineering services, delivered in collaboration with a trusted partner company based in Halle/Saale.

    Operating from Worbis, Germany, Mr. Baur is strategically positioned to provide emergency support across the European Union within 24 hours, covering an operational radius of approximately 1,000 kilometres.

    Supporting this capability is a well-equipped service infrastructure comprising 12 Mercedes Sprinter service vans, a team of 24 skilled technicians, specialised bearing-change tools, a fully equipped hydraulic workshop, and a 1,000-square-metre facility with a five-ton crane track. Together, these resources position his team to manage the complete spectrum of Fornnax’s European service requirements efficiently and reliably.

    Partnership Driven by Industry Insight

    Having spent years servicing Eldan, Lindner, and Vecoplan shredders across the European recycling industry, Mr. Baur’s decision to collaborate with Fornnax is rooted in his understanding of market needs and customer expectations. His experience has provided valuable insight into what recycling plant operators require—not only from their machinery but also from the service teams supporting them.

    According to Mr. Baur, Fornnax’s reputation for robust machine construction, superior wear protection, and maintenance-friendly design made the partnership a natural fit.

    The collaboration comes at a time when Europe’s tyre recycling industry is facing mounting challenges, including rising cost pressures, shrinking margins, delayed investments, and a shortage of skilled labour. Mr. Baur believes these conditions reinforce the need for technically strong service partners capable of delivering rapid, dependable support.

    Commenting on the partnership, he said, “Fornnax, with its exceptional price-performance ratio and superior quality, has the potential to become a market leader in Europe. We would like to be their service partner in this journey.”

    Comprehensive Support Across the Equipment Lifecycle

    As Fornnax’s authorised service partner, Mr. Baur will oversee the complete lifecycle support of the company’s equipment throughout the European Union. His responsibilities will include installation, commissioning, preventive maintenance, emergency repairs, and spare parts support across mechanical, hydraulic, and electrical systems.

    Looking ahead, he also plans to develop a centralised spare parts distribution hub for European customers, particularly if Fornnax establishes a warehouse facility in Worbis to facilitate faster deliveries. To further strengthen service coverage, Mr. Baur intends to expand operations by adding two to three additional service teams and vehicles each year, progressively increasing capacity across the continent.

    A Shared Commitment to Customer Excellence

    Highlighting the strategic importance of the partnership, Mr. Jignesh Kundaria, Director and CEO of Fornnax, said:

    “We strongly believe that by continuously improving our service quality and customer satisfaction index, we can build long-term relationships with our customers. Higher customer satisfaction leads to greater trust, which significantly increases repeat orders and ultimately drives sustained growth in our sales revenue.”

    This customer-first philosophy underpins Fornnax’s strategy of building a dedicated European service partner network instead of relying solely on remote support. With Mr. Baur joining this network, customers across the European Union will benefit from faster response times, expert technical assistance, and dedicated on-ground support from a partner with extensive experience in high-throughput shredding operations.

    Mr. Baur’s appointment also reflects Fornnax’s broader ambition to establish itself as the preferred shredding solutions provider for the European recycling industry, marking another important milestone in the company’s international growth strategy.

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    Concrete

    Nuvoco Vistas launches Limla cement plant, expands Gujarat footprint

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    Nuvoco Vistas opens a 2 MMTPA grinding unit at Limla, entering Gujarat and advancing its target of 35 MMTPA capacity by FY 2028.

    Surat (Gujarat)

    Nuvoco Vistas Corporation Ltd, a part of Nirma Group and one of India’s leading building materials company, has inaugurated the Limla Cement Plant in Surat (Gujarat), one of Vadraj Cement Limited’s (VCL) principal manufacturing facilities. The commissioning represents a key milestone in Nuvoco’s acquisition and restoration of VCL, while supporting the company’s expansion across the Western Indian cement market.

    Vadraj Cement Limited is a subsidiary of Nuvoco Vistas Corporation Limited and has installed cement capacity of 6 MMTPA across its assets. The Limla inauguration therefore represents the first operational step in the acquired platform’s wider revival, while the Kutch facilities provide clinker supply, mineral security and coastal logistics support for the western business.

    Nuvoco completed its acquisition of Vadraj Cement Limited, then under the Corporate Insolvency Resolution Process, after paying a consideration of Rs 1,800 crore in June 2025. VCL’s asset portfolio comprises a clinker unit at Kutch and a grinding unit at Limla in Surat. It also includes high-quality captive limestone reserves and a captive jetty at Kutch, supporting more efficient logistics. Following the takeover, Nuvoco began an extensive programme of restoration, refurbishment and expansion at both locations, leading to the commissioning of the Limla plant.

    The Limla Cement Plant is expected to support a phased increase in sales volumes across Gujarat. It will also help Nuvoco supply neighbouring markets in Western Maharashtra and release cement capacity from its northern plants, which can consequently be redirected towards markets in North India. The plant will manufacture a full portfolio comprising Ordinary Portland Cement, Portland Slag Cement, Portland Pozzolana Cement and Portland Composite Cement. It will additionally produce the complete Nuvoco Duraguard range, including the premium Nuvoco Duraguard Microfibre product. The acquisition is also expected to generate operational synergies with Nuvoco’s existing plants at Nimbol and Chittorgarh in Rajasthan, improving logistics optimisation and market reach across important regional markets.

    The grinding unit at the Limla Cement Plant was completed ahead of schedule, with 2 MMTPA of capacity now inaugurated to expand Nuvoco’s operating scale and customer reach. After Vadraj Cement’s assets become fully operational, plants in North and West India are expected to account for nearly 40 per cent of Nuvoco’s total cement capacity. This will broaden the company’s manufacturing network, strengthen access to high-growth markets and support its plan to increase consolidated cement capacity to 35 MMTPA by FY 2028, reinforcing its longer-term growth strategy.

    Commenting on the development, Jayakumar Krishnaswamy, Managing Director, Nuvoco Vistas Corp Ltd, said: “The inauguration of the Limla Grinding Unit in Surat is an important milestone in Nuvoco’s growth journey and demonstrates our commitment to disciplined, value-accretive expansion. Gujarat is strategically significant for Nuvoco, with substantial opportunities arising from infrastructure investment, industrial growth, rapid urbanisation and continuing demand from the housing and construction sectors. The facility strengthens our regional footprint, improves operational flexibility and increases our ability to serve customers across northern and western markets with greater reliability and efficiency.”

    He added: “Through the Vadraj acquisition, we have refurbished and restarted a strategically important asset, returning it to operations in record time through strong execution and collaboration between teams. The achievement demonstrates our ability to create value from acquired assets, fulfil our commitments and retain the confidence of stakeholders. It also highlights the strength of our project delivery capabilities and our continued focus on building sustainable, profitable growth over the long term.”

    Nuvoco Vistas Corporation Limited is a building materials company whose vision is to build a safer, smarter and more sustainable world. It is among the leading players in East India and has a significant presence across North and West India. Nuvoco began operations in 2014 with a greenfield cement plant at Nimbol, Rajasthan. It later acquired Lafarge India Limited, which had entered India in 1999, followed by Emami Cement Limited in 2020 and Vadraj Cement Limited in April 2025. The company has also announced an expansion in eastern India through a new grinding mill at the Arasmeta Cement Plant, supported by several debottlenecking programmes involving equipment upgrades, process improvements and internal capacity initiatives. These developments place Nuvoco on track to achieve total cement capacity of approximately 35 MMTPA. The company reported total income of Rs 11,362 crore in FY 2025-26, reflecting its continuing growth trajectory.

    Nuvoco operates a diversified portfolio across three segments: Cement, Ready-Mix Concrete and Modern Building Materials. Its cement portfolio includes Concreto, Duraguard, Double Bull, PSC, Nirmax and Infracem, covering Ordinary Portland Cement, Portland Slag Cement, Portland Pozzolana Cement and Portland Composite Cement. Its pan-India RMX business provides value-added products under Concreto for performance concrete, Artiste for decorative concrete, InstaMix for ready-to-use bagged concrete, X-Con covering M20 to M60 grades, and Ecodure for specialised green concrete. Nuvoco has supplied materials to projects including the Mumbai-Ahmedabad Bullet Train, Birsa Munda Hockey Stadium in Rourkela, Aquatic Gallery at Science City in Ahmedabad, and metro railway projects in Delhi, Jaipur, Noida and Mumbai.

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    Concrete

    Green Construction Through Cement Innovation

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    Indian Cement Review (ICR) and Fuller Technologies brought industry, policy and technology leaders together to discuss how cement innovation can drive green construction at scale, writes Rakesh Rao.

    India is building at a pace few countries can match. Highways, airports, housing, logistics parks, industrial corridors and urban infrastructure are reshaping the country’s economic geography. But beneath this growth story lies a difficult question: can India continue to build at scale without locking itself into a high-carbon future?

    That question formed the core of an online panel discussion titled “Driving Green Construction Through Cement Innovation”, organised by Indian Cement Review (ICR) in association with Fuller Technologies as the Presenting Partner on June 25, 2026. The webinar brought together experts from cement technology, R&D, global industry platforms, building performance policy and international development cooperation to examine how low-carbon cement and material innovation can accelerate India’s green construction transition.

    The discussion came at a crucial time. India has committed to achieving net-zero emissions by 2070 and reducing the carbon intensity of its economy by 45 per cent by 2030. At the same time, the country’s construction sector is expanding rapidly, driven by urbanisation, infrastructure development, housing demand and industrial growth. Cement, as one of the most widely used construction materials, sits at the heart of this transition. It is indispensable to development, but also central to the challenge of reducing embodied carbon in buildings and infrastructure.

    Moderated by Nitika Krishan, Senior Urban Infrastructure and Sustainable Policy Consultant, the panel featured:

    • Kiranmai Sanagavarapu, Director, Low Carbon Solutions, Fuller Technologies;
    • Dr Hemantkumar Aiyer, VP and Head R&D, Nuvoco Vistas Corp Ltd;
    • Devika Wattal, Innovation Lead, Global Cement and Concrete Association (GCCA);
    • Dr Sunita Purushottam, MD, GBPN India (Global Buildings Performance Network); and
    • Vaibhav Rathi, Senior Technical Advisor, GIZ (the German Agency for International Cooperation)

    Setting the tone for the discussion, Nitika Krishan underlined the scale of the challenge before the sector. “The question before us is no longer whether we build, but how we build sustainably,” she said. She pointed out that construction accounts for nearly 40 per cent of global energy-related carbon emissions when both operational and embodied carbon are considered. Cement production, she added, remains one of the hardest industrial processes to decarbonise.

    For India, this is not merely an environmental issue. It is a development issue, a competitiveness issue and increasingly, a market issue. As one of the world’s largest cement producers and among the fastest-growing construction markets, India’s material choices will influence the carbon trajectory of its built environment for decades. As Krishan observed, sustainability solutions in economies such as India must not remain limited to laboratory success. They must be scalable, commercially viable and practical at national level.

    The innovation gap: From technology to market

    Experts believe that there is a need to bridge the innovation gaps for making decarbonisation in cement and concrete scalable. Devika Wattal of GCCA, explained, “The starting point must be the core cement manufacturing process itself. The first and foremost is the heart of our process, the heart of cement manufacturing. How do we reduce clinker? That is always a topic where industry is working very intrinsically.”

    Clinker reduction remains one of the most important pathways for lowering emissions in cement. Since clinker production is energy-intensive and chemically emits carbon dioxide, reducing the clinker factor through supplementary cementitious materials (SCMs), blended cements and new chemistries can have a significant impact. Wattal also noted that carbon capture, utilisation and storage (CCUS) will have a role, though it may not be the first lever for all markets.

    However, she stressed that innovation cannot stop at technology development. A solution that works in the lab must also be adaptable to industry, scalable in production and acceptable in construction practice. “It is important for that innovation to be adaptable, to be scalable, and so that it can be executed in real time,” she said.

    Wattal also called for stronger enabling systems around innovation. These include performance-based standards, product-level embodied carbon databases and clearer frameworks for evaluating green materials. Without these, low-carbon cement products may struggle to compete with conventional materials in procurement and design.

    R&D must balance carbon, cost and performance

    Bringing in the R&D perspective into the discussion, Dr Hemantkumar Aiyer of Nuvoco Vistas emphasised that low-carbon cement development cannot be treated as a single-variable exercise. Cement must perform in real construction conditions. It must deliver strength, durability, consistency and cost competitiveness, while also reducing carbon.

    “The root of understanding and balancing all these aspects lies in materials, and knowing the materials,” he said.

    According to Dr Aiyer, R&D teams must understand the variability of raw materials such as fly ash, slag and clinker. Different sources produce different material behaviours. This makes mix optimisation, material characterisation and processing-property relationships critical. When performance is affected, cement manufacturers must understand how strength enhancers, admixtures and other performance chemicals interact with the material system.

    He also linked material science with process efficiency. Clinkerisation takes place at extremely high temperatures, around 1,400 to 1,450 degrees Celsius. Any improvement in raw mix design, process control or energy optimisation can, therefore, help reduce emissions and cost. Dr Aiyer pointed to artificial intelligence-based optimisation, Cement 4.0 tools and advanced software as important enablers for real-time process and material control.

    “The more you understand the materials, the more you can control it,” he said.

    LC3: The promise is proven, the sequencing is not

    Limestone calcined clay cement, commonly referred to as LC3, has attracted global attention because it can reduce clinker content significantly by using calcined clay and limestone while maintaining performance in many applications. Kiranmai Sanagavarapu of Fuller Technologies said the technology itself has already moved beyond proof of concept. Fuller Technologies has worked with calcined clay technology for nearly two decades and has seen plants running in France and Ghana. These plants, she said, are meeting local and national specifications, while the economics are beginning to make sense.

    “The calciner is performing, the economics is stacking up, it is making business sense to produce,” she said.

    But if the technology is viable, why has adoption not scaled faster? For Sanagavarapu, the answer lies in project sequencing. Too often, clay characterisation happens after equipment is specified. This, she warned, is a backward approach because calciner design depends on clay mineralogy, kaolinite content, iron levels, reactivity, moisture and other variables.

    “If you don’t know what your deposit looks like before you commit for the equipment, you are, in a way, going blind into designing,” she said.

    She also identified permitting and plant integration as major bottlenecks. Environmental clearances, mining permissions and local regulatory approvals must begin early. Similarly, calcined clay must be integrated into existing grinding, blending and logistics systems from the design stage, not treated as an afterthought during commissioning.

    India already has IS 18189:2023 standard for LC3, but Sanagavarapu pointed out that the standard is not yet visible enough in procurement documents. “The gap between what is technically being permitted and what the procurement is asking is the single biggest bottleneck,” she said.

    In her view, successful scale-up depends on getting the sequence right: clay characterisation first, permitting in parallel, standards aligned with construction, and integration built into plant design.

    India’s LC3 journey: Progress, but demand remains thin

    Providing details of India’s LC3 commercialisation experience, Vaibhav Rathi of GIZ noted that JK Cement carried out the first commercial production of LC3 at its Rajasthan plant, followed by JK Lakshmi Cement three months later. These initiatives were supported by the International Climate Initiative of the Government of Germany, with IIT Delhi contributing deep institutional knowledge on LC3 research and BIS certification.

    Rathi said India’s early experience has produced clear lessons. One of the biggest was the need to build capacity among regulators. While BIS certification existed, State Pollution Control Boards were unfamiliar with the technology and unsure about the approval pathway.

    “The capacity building is not just needed amongst the producer and the users of the cement, but also the regulators who are working with this technology for the first time,” he said.

    He also highlighted the need for better information on China clay deposits. Since China clay is currently classified as a minor mineral, centralised data on availability, quality and location is limited. If cement manufacturers are to adopt LC3 at scale, stronger mineral intelligence will be important.

    The third issue is demand. LC3 has already been used in projects such as Palava City in Mumbai and Noida International Airport, but these remain limited examples. “It is in a chicken and egg situation,” Rathi said. “Cement companies are saying we need more demand, and users are saying there is not enough cement available.”

    Public procurement, he suggested, could help break this cycle. If agencies such as CPWD and other public bodies begin testing, accepting and specifying LC3, it could create the market confidence needed for cement companies to invest in production and storage.

    Building codes must catch up with innovation

    Dr Sunita Purushottam of GBPN India argued that material choices will determine built environment emissions over the long term, but India’s current policy signals remain fragmented. Although LC3 has received BIS recognition, she pointed out that building codes, municipal bylaws, schedules of rates and sustainability codes do not yet provide uniform guidance on low-carbon cement.

    “The current cement regulations are largely prescriptive and favouring traditional materials,” she said. This limits the ability of alternative materials to compete on performance, durability and emissions.

    Dr Purushottam also raised the issue of taxation. Cement, including LC3, currently falls under the same GST bracket as conventional cement. A differentiated tax structure, she argued, could help accelerate market adoption. “In order for the market to demand LC3, that differentiation in the GST could go a long way,” she said.

    She noted that green building certifications such as IGBC and GRIHA are already creating demand for low-carbon materials by assigning points for embodied carbon and sustainable material use. However, she said large-scale adoption will require regulatory mandates, particularly through building codes and state-level notifications.

    She also cautioned that low-carbon cement alone does not solve the entire building performance problem. A material may reduce embodied carbon, but the operational carbon of a building depends on thermal performance, design, insulation and energy use. “The energy part has two elements,” she said. “One is the embodied carbon of the material itself, and the other is the operational carbon.”

    Collaboration is the bridge between invention and impact

    Wattal said GCCA sees innovation as a strategic priority and works through platforms that connect industry with academia and start-ups. “There is no way we will decarbonise our sector without innovation,” she said.

    However, she stressed that research must be connected to actual industry challenges. Innovations developed in isolation may fail when they encounter real-world barriers such as raw material variability, plant integration, cost, standards and finance. Start-ups, too, need industry mentorship and scale-up pathways.

    Wattal also flagged the importance of finance. Even strong technologies may struggle to attract investment if there is no common understanding of bankability. “We have always put projects into, is this a bankable project? But the definition of a bankable project has never been defined,” she said.

    For India, she saw strong potential in its academic and start-up ecosystem, but said the challenge lies in alignment and prioritisation. The country has the research base, industrial capacity and market size. What it now needs is a coordinated route from innovation to deployment.

    There is a practical concern for cement manufacturers: how can existing plants be adapted for lower emissions without compromising reliability or commercial viability?

    Kiranmai Sanagavarapu addressed, “The reliability risk in calcined clay retrofit is definitely real, but it is almost always self-inflicted. The risk arises when a new process is added to an existing circuit without properly redesigning grinding and blending configurations.”

    Existing cement plants, she explained, can take two broad routes. The first is external sourcing of calcined clay combined with mill optimisation. This requires lower capital investment and can potentially move in 12 to 18 months if other conditions are in place. It may reduce emissions by around 20 to 30 per cent. The second route is integrated calcination on site, which requires higher capital expenditure and longer lead times, but provides greater control over quality, supply and emissions reduction potential.

    For Sanagavarapu, the principle is simple: low-carbon retrofits must be designed with intent. “Design it with an intent properly from the start. Start in the market conditions where the economics are already working,” she said.

    Circularity: The overlooked advantage

    According to Vaibhav Rathi, fly ash and slag are already well established in cement and construction (C&D), but construction and demolition waste remains underutilised. “C&D waste is a growing business opportunity which not many have taken up,” he said. India’s continuous construction and demolition activity creates huge volumes of waste, much of which contributes to air pollution, land degradation and material inefficiency. With the right processing and standards, this waste can be converted into useful construction products.

    Rathi also pointed out that LC3 has a circular economy dimension that is often overlooked. It can use low-grade kaolin-rich clay left behind after high-grade clay is extracted for other applications. “LC3 is not only a low-carbon solution, but also a circular economy solution,” he said.

    At the same time, he cautioned that LC3 in India is not yet cheap because it has not reached scale. Site-specific techno-commercial feasibility studies, supported jointly by development agencies and industry, could help companies assess whether LC3 production makes technical and financial sense at a given location.

    Dr Purushottam added that India must address both low-carbon cement and construction waste together. “Both low-carbon cement and C&D waste go hand in hand. India does not have an option but to work on both,” she said.

    Dr Aiyer called for policy shifts from both government and industry, including preferential purchasing of sustainable materials, minimum supplementary cementitious material requirements in public and public-private projects, and faster regulatory implementation. “If we can fast-track the regulatory standards and their implementation on the ground, that is the way to go,” he said.

    From green ambition to green construction

    Cement innovation is no longer only about chemistry. It is about systems. Low-carbon cement will scale only when technology, standards, procurement, finance, regulation, education and construction practice move together.

    LC3 and other low-carbon technologies have shown promise. India has early commercial examples, strong research capability and growing market interest. But mainstream adoption will depend on whether demand can be created, regulators can be capacitated, standards can be embedded in procurement, and manufacturers can see a clear business case.

    For a country building at India’s scale, the opportunity is enormous. Cement will continue to be central to infrastructure and urban development. The challenge now is to ensure that the cement used in India’s growth story carries a lower carbon burden.

    • Rakesh Rao

    Participate in Cement Expo 2026 and discover how next-gen infrastructure can be built with innovations in cement.

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