According to ICRA, the mining and construction equipment (MCE) industry is expected to witness a decline in volumes this fiscal owing to slow pace of infrastructural investments and various regulatory hurdles. The rating agency said the MCE industry will witness a volume fall of 12-15 per cent to around 60,000-63,000 units in FY13.
Deferment in private projects and slow pace of infrastructural investments were among the key reasons hurting construction equipment volumes, while curb on mining in several geographies has impacted demand for mining equipment, ICRA said in its report.
However, construction activity in the private sector may revive during the latter half of FY14, supported by a relatively benign policy environment. Also, the prevailing large demand-supply gap in the domestic power sector and the need for basic infrastructure is expected to support requirement for mining and consequently mining equipment over the longer term.