Madhumitha Jaganmohan
Research expert covering climate and environmental sustainability
Cement is a versatile and essential building material used in any modern construction. It is a durable binder for structures that holds coarse aggregates like sand, gravel, and steel. While other building materials have been invented, cement remains an irreplaceable and critical part of construction due to its high strength and durability. With the world's first or second-largest population, India is also the second-largest cement producer globally.
The Indian cement industry has attracted huge investments from local and foreign investors, owing to attractive profit margins and growing demand. Between 2000 and 2021, the construction sector received five percent of total foreign direct investments in India.
The rural housing and urban housing sectors accounted for a combined 54 percent of cement consumption in India as of 2021, while low-cost housing accounted for a further 12 percent of consumption. Accordingly, it is evident that higher government spending on housing is a key growth driver for this industry. Infrastructure development initiatives such as 'Housing for all by 2022' and 'Smart Cities Mission' are heavily dependent on the cement industry's growth. There is a lot of potential for developing infrastructure and construction projects in India; additionally, the local availability of raw materials for cement production like limestone and coal aids the cement sector.
India's cement production capacity
In 2022, India's cement production amounted to an estimated 370 million metric tons, which accounted for a nine percent share of global cement production that year. Private companies dominate the Indian cement industry; Ultratech Cement Limited is one of the leading Indian cement producers recognized globally. As of 2022, the company had an installed capacity of over 93.3 metric tons per year.The Indian cement industry has attracted huge investments from local and foreign investors, owing to attractive profit margins and growing demand. Between 2000 and 2021, the construction sector received five percent of total foreign direct investments in India.
Cement consumption in India
Cement manufacturing is a highly energy-intensive process, and coal has traditionally been the fuel of choice for cement industries due to its abundance and availability. Because of this and difficulties in transportation over long distances, cement is a highly regional commodity in most parts of India.The rural housing and urban housing sectors accounted for a combined 54 percent of cement consumption in India as of 2021, while low-cost housing accounted for a further 12 percent of consumption. Accordingly, it is evident that higher government spending on housing is a key growth driver for this industry. Infrastructure development initiatives such as 'Housing for all by 2022' and 'Smart Cities Mission' are heavily dependent on the cement industry's growth. There is a lot of potential for developing infrastructure and construction projects in India; additionally, the local availability of raw materials for cement production like limestone and coal aids the cement sector.
