India Construction Equipment Sales Fall 10% Amid Slowdown

India’s construction equipment (CE) industry is facing mounting pressure on the domestic front, with sales declining by 10% during the first nine months of the current financial year, reflecting the impact of slower infrastructure execution and persistent financing challenges. However, a sharp rise in exports has helped partially offset the downturn, highlighting contrasting trends within the sector.

Data released by the Indian Construction Equipment Manufacturers Association (ICEMA) shows that domestic sales fell from 89,244 units in the year-to-date period of FY 2024–25 to 81,566 units in YTD FY 2025–26 (April to December 2025). ICEMA, the sole authoritative source for construction equipment industry statistics in India, attributed the decline to muted infrastructure activity, project execution delays, financing constraints and subdued near-term demand across key equipment categories.

The slowdown extended into the third quarter of FY26, with total industry sales—including domestic sales, OEM exports and unauthorised exports—dropping 9% year-on-year to 35,891 units compared to Q3 FY25. Segment-wise data points to broad-based weakness. Earthmoving equipment, the industry’s largest segment, recorded sales of 25,715 units in Q3 FY26, down 9% year-on-year. Material handling equipment sales declined 10% to 4,306 units, while concrete equipment fell 9% to 3,335 units amid subdued residential and commercial construction activity. Road construction equipment sales dropped 7% to 1,942 units, despite India’s long-term infrastructure ambitions. Material processing equipment emerged as the most resilient category, registering a marginal 1% decline at 593 units.

While domestic demand remains under strain, exports provided a much-needed cushion. Construction equipment exports surged 28% during the nine-month period, helping limit the overall industry decline to 5%. Total sales for YTD FY26 stood at 94,035 units, compared to 98,977 units in the corresponding period last year. Industry experts note that the export performance underscores India’s growing competitiveness in global CE markets, though they caution that overseas demand alone cannot fully compensate for prolonged domestic weakness.

ICEMA also flagged the rising issue of unauthorised exports, particularly in backhoe loaders and excavators. In such cases, equipment sold domestically is exported without the knowledge of OEMs or financiers, increasing loan default risks and distorting industry data. Excluding these unauthorised exports, the actual decline in legitimate domestic activity could be steeper, the association warned.

Industry leaders have cited multiple factors behind the slowdown, including the transition to CEV Stage V emission norms, which affected asset values and purchasing decisions, slower government project awards across roads, highways and railways, land acquisition delays, and tighter financing conditions. Despite the challenges, stakeholders remain cautiously optimistic, banking on higher infrastructure capital expenditure, faster project awards and improved execution momentum to revive domestic demand in the coming quarters.