The growth in coal production declined to a six-month low of 15.5 per cent in April 2020 compared with growth of 4 per cent in March 2020.
In view of the nationwide lockdown due to Covid-19 pandemic and the substantial production loss experienced by a number of industries, the core sector production in April 2020 contracted at its fastest pace in the last eight years. The production in the eight-core industries contracted by 38.1 per cent in April 2020 compared with 5.2 per cent in the corresponding month a year ago. All the eight industries of the core sector have experienced negative growth in April 2020. The contraction in March 2020 has been revised lower to 9 per cent from the earlier 6.5 per cent largely on account of downward revision in steel output. The de-growth of much sharper level was seen in July 2012 when the negative growth was 67.5 per cent. The core sector growth for FY20 has been consequently revised lower from 0.6 per cent to 0.4 per cent.
Highlights
The growth in coal production declined to a six-month low of 15.5 per cent in April 2020 compared with growth of 4 per cent in March 2020. Lower production can largely be attributed to lower power demand and build-up of inventories in the coal mines and power plants.
Production of crude oil continued to witness a contraction for 29th consecutive month. Crude oil production contracted by 6.4 per cent in April 2020 largely on account of closure of some oil wells and restriction in labour movements for field operations.
Natural gas and refineries both recorded double digit contraction of 19.9 per cent and 24.2 per cent respectively in April 2020. Steep decline in the fuel consumption in April 2020 and lower offtake of natural gas by consumers dragged production lower in April. The contraction in both has been the highest since the start of the 2011-12 series.
The contraction in cement and steel production was the sharpest and the fall was more than 80 per cent in both industries. Halt in production of user industries like auto and construction led to contraction in steel production. Nation-wide lockdown and reverse labour migration had an impact on construction activities owing to which production of both cement and steel declined. Both the industries recorded the steepest fall since the start of the new series.
Fertilizer production contracted by 4.5 per cent in April 2020 compared with 12 per cent recorded a month ago. Shortage in raw material availability and labour constraints owing to the pandemic impacted fertilizer production.
Electricity production also contracted at its fastest pace since the start of the new series at 22.8 per cent in April 2020 owing to the fall in electricity demand from commercial and industrial sector, which accounts for 50 per cent of the demand.
CARE Ratings’ View The nation-wide lockdown and the reverse labour migration have had an adverse impact on the production activity in the month of April 2020. The continuation of the lockdown in May 2020, albeit some relaxations means that the negative growth in core sector production will continue but could be marginally better than April 2020. One can expect a noteworthy decline in IIP growth for April 2020 given that core sector accounts for almost 40 per cent of the total IIP basket.
Courtesy: CARE Ratings
ABOUT THE AUTHORS: The article is authored by Sushant Hede, Associate Economist at CARE Ratings. He can be contacted at: sushant.hede@careratings.com | 91-22-68374348..
Disclaimer: This report is prepared by CARE Ratings Ltd. CARE Ratings has taken utmost care to ensure accuracy and objectivity while developing this report based on information available in public domain. However, neither the accuracy nor completeness of information contained in this report is guaranteed. CARE Ratings is not responsible for any errors or omissions in analysis/inferences/views or for results obtained from the use of information contained in this report and especially states that CARE Ratings has no financial liability whatsoever to the user of this report.
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.
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