Connect with us

Concrete

Budget 2024: Strategies for Sustainable Growth

Published

on

Shares

The unveiling of Union Budget 2024 marked a pivotal moment for India’s economic trajectory, blending ambitious growth targets with pragmatic fiscal policies. ICR gets key stakeholders from the cement sector to voice their views about the Budget.

In the Interim Budget 2024-25, the honourable Finance and Corporate Affairs Minister, Nirmala Sitharaman, had declared an 11.1 per cent increase in capital expenditure for infrastructure, raising the outlay from `10 lakh crore to Rs.11.11 crore, or 3.4 per cent of GDP. Based on these revelations, the cement industry was optimistic about significant investments in highways, roads, bridges and urban development projects to be declared in the Union Budget 2024. The industry was not disappointed. Ambitious initiatives such as Bharatmala and Sagarmala are now offering immense growth potential for the sector, provided they receive adequate funding.
The Indian cement industry was eagerly anticipating a considerable boost in budget allocations for housing and infrastructure projects, as together these sectors constitute over 80 per cent of cement demand in the country. Following are the highlights of Union Budget 2024 with regards to these expectations.

Urban development

  • Formulation of Transit Oriented Development plans and strategies to implement and finance 14 large cities above 30 lakh population.

Urban housing

  • Investment of Rs.10 lakh crore, including the central assistance of Rs.2.2 lakh crore in the next 5 years, under PM Awas Yojana Urban 2.0 proposed to address the housing needs of 1 crore urban poor and middle-class families.
    Infrastructure
  • Rs.11,11,111 crore (3.4 per cent of GDP) to be provided for capital expenditure.
    Infrastructure investment by state governments
  • Provision of Rs.1.5 lakh crore for long-term interest free loans to support states in infrastructure investment.
    Pradhan Mantri Gram Sadak Yojana (PMGSY)
  • Launch of phase IV of PMGSY to provide all-weather connectivity to 25,000 rural habitations.
    We bring you reactions to the Union Budget 2024 by industry experts:

“The Union Budget 2024-25 presents a compelling roadmap for India’s infrastructure and economic growth. Its focus on productivity, job creation, and urban development aligns with our vision for a resilient India. The substantial capital expenditure allocation of Rs.11.11 lakh crore demonstrates the government’s commitment to nation-building, benefiting the construction materials sector, including cement. We commend the `1.48 lakh crore investment in education, employment, and skill development, which will enhance workforce capabilities. The emphasis on sustainability and clean energy, along with the PM Surya Ghar Muft Bijli Yojana, resonates with JK Lakshmi Cement’s green initiatives. As a leading cement manufacturer, we’re prepared to contribute significantly to India’s infrastructure development, leveraging these policies to build a stronger, more sustainable future.”
– Arun Shukla, President and Director, JK Lakshmi Cement

“We welcome the Government’s consistent approach towards Fiscal consolidation, supporting Capex in Infrastructure by reconfirming the allocation of Rs.11.11 lakh crore in the budget as also additional allocations towards improving Urban and Rural Infrastructure. We also welcome the government’s focus on employment generation, skilling, Woman empowerment, MSMEs and climate change mitigation as well as their encouragement to the States to carry out land and labour reforms and improve Ease of doing Business further. We believe this Budget paves the way for the next generation of reforms which we are confident will lead India to its deserved place of being Viksit Bharat.”
– Sunil Mathur, Managing Director and Chief Executive Officer, Siemens

“We welcome the government’s strong commitment to inclusive development in this year’s budget with the vision of a ‘Viksit Bharat’. The focus on nine priority areas and employment will entail sustained efforts to generate ample opportunities for all. The government’s decision to maintain the interim capital expenditure target of Rs.11.11 lakh crore — the highest allocation ever at 3.4 per cent of GDP — reflects the sustained reliance on infrastructure development to drive economic growth. Additionally, the allocation of Rs.2.66 lakh crore for rural development, including rural infrastructure projects, will play a remarkable role in transforming the rural economy. The women-first initiatives for enhancing women’s participation in the labour force are also a welcome move. This focus on innovation, infrastructure, and inclusive development will ensure sustainable progress across the nation and also ensure that the impact reaches the common man.”
– Akshat Seth, Managing Director and CEO, HIL (a CK Birla group unit)

“Investments in infrastructure, urban planning, and digitization of land records are crucial steps towards enhancing the real estate sector in Hyderabad. We believe that these measures will not only boost the sector’s contribution to the economy but also address the housing needs of millions, driving inclusive growth and development.”
– V Rajashekhar Reddy, President,CREDAI Hyderabad

“The 2024 Budget’s emphasis on revising the personal income tax structure and increasing the standard deduction for salaried individuals from Rs.50,000 to Rs.75,000 is a welcome move. This initiative, coupled with the encouragement to states to lower stamp duty and the proposal for reduced stamp duty for women purchasing property, will make home ownership, particularly for first-time buyers, more accessible and financially viable. Additionally, the focus on affordable housing, with a substantial `10 lakh crore investment under the PM Awas Yojana-Urban, aims to address the housing needs of 1 crore urban poor, signalling robust support for residential real estate. The emphasis on industrial parks and infrastructure development will further bolster economic growth, paving the way for a dynamic real estate market.”
– Vishal Raheja, Founder and Managing Director, InvestoXpert

“The Union Budget 2024 was built on the foundation of Viksit Bharat. A strong focus was put on solar energy. The remarkable achievement of PM Surya Ghar Muft Bijli Yojana with 1.28 crore registrations and 14 lakh applications reflected the growing public awareness and alignment with the government’s vision of a solar-powered India. As a leading solar panel manufacturer, this motivates us to make solar energy more adoptable, affordable, and
accessible nationwide.
The exemption of customs duty on lithium, a crucial mineral used in the renewable energy sector, will reduce costs, making lithium-based technologies more affordable. The pumped storage policy which includes pumped storage projects for electricity storage will facilitate the smooth integration of the growing share of renewable energy into the overall energy mix, paving the way for a sustainable energy future. Imposing customs duty on the import of solar glass for solar cell and module production will promote domestic manufacturing and boost the economy. The increase of BCD on non-biodegradable PVC flex banners from 10 to 25 per cent is a commendable step towards environmental conservation. Power projects including setting up of a new 2400 MW power plant at Pirpainti, Bihar will add Bihar in the category of solar powered states, overall enhance the power quotient, add to the existing power capacity and create jobs. Overall, the budget highlighted the remarkable changes that will contribute to the development of a nation we all envisioned.”
– Raman Bhatia, Founder and Managing Director, Servotech Power Systems

“The removal of angel tax is a welcome move for India’s startup ecosystem. This, coupled with the establishment of a Rs.1,000 crore VC fund for the space economy, will foster innovation. The budget’s focus on manufacturing, with the introduction of plug-and-play industrial parks, is progressive. MSMEs will benefit significantly from the credit guarantee scheme, new assessment models by PSU banks and increased Mudra loan limits. The substantial allocation of `11 lakh crore for infrastructure, especially nature resilient is crucial for building a Viksit Bharat. The strategic shift towards nuclear energy as a major power source is visionary. Finally, the emphasis on cultural heritage through the development of the Vishnupad, Mahabodhi temple corridors, Rajgir and Nalanda is a welcome addition.”
– Rahul Garg, CEO and Founder, Moglix

“The recent budget has been highly favourable for the energy sector, with the government setting an ambitious goal of achieving 500 GW of renewable power by 2030. A key component of this plan is encouraging homeowners to adopt solar energy, facilitating a swift transition to solar power. To support this, the government has allocated Rs.70,000 crores in subsidies for homes that switch to solar energy. This is a crucial and forward-thinking initiative for the country’s future, and we express our gratitude to the government for taking this significant step.”
– Saurabh Marda, Co-founder and Managing Director, Freyr Energy

“I would like to congratulate the Government for presenting a visionary Budget that focuses on sustainable and inclusive economic growth. I particularly welcome several announcements that reflect the Government’s continued support for the renewable energy sector. The impetus on PM Surya Ghar Muft Bijli Yojana will help fast track nationwide adoption of rooftop solar, helping expand our overall RE capacity. The proposed investment in Pumped Storage programmes is a much-needed step that will ensure smoother integration of growing RE, leading to more reliable supply of green power and grid stability. The focus on transitioning hard to abate industries to greener alternatives will catalyse the C&I sector’s journey towards net zero. Introduction of a taxonomy for climate finance will help attract much needed capital for boosting climate resilience. Finally, the expanded duty exemptions will also help propel the RE sector ahead. This is a positive budget for the sector that should help continue the momentum of India’s energy transition and Hero Future Energies remains committed to partnering with the Government in enabling this mission.”
– Srivatsan Iyer, Global CEO, Hero Future Energies

Concrete

Lokesh Lays Stone For Rs 31 Billion Cement Unit In Kadapa

Line-2 expansion to make Kadapa a major cement hub

Published

on

By

Shares

Andhra Pradesh Education and IT Minister Nara Lokesh on Wednesday laid the foundation stone for the Line-2 expansion of Dalmia Bharat Cement at Chinnakomerla village in Mylavaram Mandal in Kadapa district. The project carries an investment of Rs 31 billion (bn) and is slated for completion by the third quarter of the financial year 2028. The expansion is intended to boost industrial growth and employment generation across the Rayalaseema region.

Once commissioned, the Kadapa facility will become Dalmia Bharat’s largest integrated cement manufacturing ecosystem in southern India, creating over 1,000 direct and indirect jobs and opening new business avenues for regional micro, small and medium enterprises and transport operators. Lokesh said the expansion signalled growing corporate confidence in the state and reflected the practical ease of doing business that secured repeat investment.

He placed the project within the government’s wider economic targets and recalled the Yuvagalam padayatra commitment to generate two million (mn) jobs within five years, noting that the state would cultivate talent while industry created opportunities. Lokesh highlighted Andhra Pradesh’s competitive pursuit of major manufacturing accounts, mentioning past successes and a personal initiative to engage global investors when persuading them to anchor expansion in the state.

The plant will leverage Kadapa’s abundant limestone reserves to scale production and sustainability. Clinker capacity is planned to rise from two point five million tonnes per annum (mn tpa) to six point one mn tpa, while overall cement output will increase from three point six mn tpa to nine point six mn tpa. The unit is designed to operate on over eighty per cent renewable energy and deploy waste heat recovery, zero liquid discharge, water recycling and advanced AI systems to optimise efficiency. Industries Minister TG Bharat, BC Welfare Minister S. Savitha and Jammalamadugu MLA C. Adinarayana Reddy attended the ceremony.

Continue Reading

Concrete

Cement Prices to Stay Flat in Q2 FY27 as Costs Squeeze Margins

HDFC Securities warns monsoon slowdown and higher fuel costs

Published

on

By

Shares

HDFC Securities has said the cement industry is unlikely to register a sequential increase in prices in Q2 FY27 as monsoon-related demand moderation coincides with rising fuel and packaging costs that will squeeze margins. The brokerage observed that price gains remained modest, with increases of two to three per cent quarter-on-quarter across regions, and noted subdued offtake in May with improvement in June as a delayed monsoon supported construction activity. The brokerage added that modest pricing gains so far have been insufficient to offset the input cost escalation.

The report stated that input cost pressures intensified in Q1 FY27 owing to the West Asia conflict, which pushed up coal and pet coke prices and is expected to keep fuel costs elevated, with a likely peak in Q2 FY27. It assessed that total variable costs, including packing, could rise by around Rs 150 per t quarter-on-quarter and that lower offtake and seasonal operating deleverage could further raise operating expenditure by about Rs 50 per t quarter-on-quarter.

Overall, cement prices were estimated to remain flat in Q2 FY27 as monsoon-led demand weakness offsets limited upside in realisation, and rising fuel costs alongside seasonal deleverage were expected to compress industry margins by over Rs 100 per t quarter-on-quarter to below Rs 880 per t. The brokerage indicated that the combined impact of energy inflation and higher packing expenditure would be the principal drivers of margin contraction in the near term. HDFC Securities projected a recovery in margins in H2 FY27 should the West Asia turmoil subside and energy and packing costs cool off.

The brokerage expressed optimism on long-term demand fundamentals and said improving realisation together with an anticipated cost cool-off should support a margin rebound from H2 FY27 onward, underpinning favourable industry prospects over the medium term. Its outlook rests on monsoon normalisation and a decline in imported fuel prices in the second half of the fiscal year.

Continue Reading

Concrete

Dalmia Bharat Begins Rs 31 Bn Green Cement Unit in Kadapa

New Andhra Pradesh plant to add 9.6 MTPA cement capacity by FY28

Published

on

By

Shares
Dalmia Bharat Limited recently laid the foundation stone for its second manufacturing unit at Kadapa in Andhra Pradesh. The company will invest Rs 31 billion in developing the next-generation integrated cement manufacturing facility.
The foundation-laying ceremony was attended by Nara Lokesh, Andhra Pradesh Minister for Information Technology, Electronics and Communications, Real-Time Governance and Human Resources Development, along with Puneet Dalmia, Managing Director and Chief Executive Officer, Dalmia Bharat, senior government officials and company representatives.
Scheduled to be commissioned by the third quarter of FY28, the Kadapa unit will become Dalmia Bharat’s largest integrated manufacturing facility in southern India. It will have a clinker production capacity of 6.1 million tonnes per annum and a cement manufacturing capacity of 9.6 million tonnes per annum.
The facility is designed to produce what the company describes as one of the world’s greenest cements. It is also expected to generate approximately 1,000 direct and indirect employment opportunities while supporting local MSMEs, transporters, contractors and service providers.
Lokesh said the investment reflected Dalmia Bharat’s confidence in Andhra Pradesh and aligned with the state’s objective of promoting sustainable industrialisation, job creation and technology-led economic growth.
Puneet Dalmia said the project represented the company’s long-term vision of developing low-carbon cement manufacturing assets. He added that the facility would establish new benchmarks in operational efficiency and sustainability while supporting India’s infrastructure and environmental goals.
Dalmia Bharat will also expand its regional community development programmes in education, healthcare, skill development and welfare through its DIKSHa and Gram Parivartan initiatives.
The company currently has an installed cement manufacturing capacity of 54.7 million tonnes across 19 manufacturing units in 12 states. It is also the first cement company globally to commit to the RE100, EP100 and EV100 initiatives.

Continue Reading

Video Thumbnail

    SIGN-UP FOR OUR GENERAL NEWSLETTER


    Trending News

    SUBSCRIBE TO THE NEWSLETTER

     

    Don't miss out on valuable insights and opportunities to connect with like minded professionals.

     


      This will close in 0 seconds