ICE Connect Magazine - May 2014 - Preview

iceconnect.eletsonline.com VOLUME 01 n ISSUE 02 n May 2014

The inside Special Focus

Cement & Concrete

Smart Cities

Metro Rail Technology

Ports & Technology Evolving Industry Trends

N N Kumar

Chairman Jawaharlal Nehru Port Trust (JNPT)

Deepak Shrivastava Chief Vigilance Officer Mahanadi Coalfields Limited

Rajiv Agarwal MD & CEO Essar Ports

V B Gadgil Managing Director L&T Metro Rail Hyderabad

Anil Banchorr Chief Executive Concrete Business ACC Ltd

Organisers

presents

The Green Cities Forum 2014 by Elets Technomedia

GREEN

aims to track the evolving pace of Green Construction Revolution being witnessed in India. The platform

CITIES FORUM

aims to engage distinct array of experts involved in the Green Building Movement who are reforming the construction outlook of our country.

20 June 2014, Pune, Maharashtra

Key Focus Emerging Trends in Green Construction

Renewable Energy for Sustainable Constructions

GRIHA Ratings & LEED Certification

Indoor Quality for Sustainable Green Structures – HVAC

Need for Development of a Green Policy

Redevelopment and transformation of existing structures to Green Buildings

Architecture & Aesthetics for Green Construction

Affordability and Prospects Ahead for Green Buildings

Eco-friendly Building Materials

Sector Beneficiaries Architects, Builders & Developers, Corporate, Government Representatives, Educational Institutions, Engineers, Energy Modelers, Electrical Consultants, Green Building Facilitators, Contractors, Green Product / Equipment Manufacturers, HVAC Consultants, Landscape Consultants, Plumbing Consultants, Town Planners etc

For General enquiry Rachita Jha Mobile: +91-9819641110, rachita@elets.in For programme details Veena Kurup Mobile: +91-7506365758, veena@elets.co.in For sponsorship & exhibition details Sudeep P. Gaonkar, Mobile: +91-9833719329 sudeep@elets.in

iceconnect.eletsonline.com

I C E CO ECT

May 2014

Connecting Technologies,Trends & Business

issue 2 n volume 01

Contents Infrastructure Construction Engineering

Cover Story – Ports

26 Special Focus –

Cement & Concrete

Realty Sector Driving RMC Industry in India

34 Equipment Finance

Evolving Trends in CE Financing

43 Hydro Power

Nimoo Bazgo Hydroelectric Project, Leh – Empowering Ladakh

46 Commercial Vehicles

8

I-SHIFT – Leveraging Efficiency, Safety & Performance

Mechanization Imperative to Meet Global Demands 12 In-Person

NN Kumar Chairman, Jawaharlal Nehru Port Trust

42 Smart Cities VB Gadgil Chief Executive & Managing Director, L&T Metro Rail (Hyderabad)

54 mining 16 Expert Speak

Rajiv Agarwal Managing Director & CEO, Essar Ports

28 Expert Speak

Manoj Kumar Managing Director, HESS Concrete Machinery India

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ICE Connect / iceconnect.eletsonline.com / May 2014

22 Smart Construction

Positive Contributions of Vigilance in Mining

Nanotechnology Paves New Wave of Sustainable Roads

further reading Editorial 5 Ventures & Business

49

Realty Updates

50

Steel & Cement

51

Port Updates

52

Energy Updates

56

Products Line

58

editorial

Transforming

Transport Networks

I

ndia is witnessing rapid pace of expansion of its towns and cities. Though the last fiscal was a hard-hit on our country’s infrastructure, wherein numerous transport projects were delayed or cancelled, the governing authorities have always considered effective transport networks as one among its prime development agenda. It is predicted that by 2030, a population of 40 percent will be living in urban ecosystems. This population pressure has a direct impact on the transport infrastructure of a city. Futuristic and efficient transport networks leverage its scope as a favorable economic investment destination.

To meet the increasing population load and their travel needs, city planners have to think out-ofthe-box and much ahead of times. The advancement in construction technologies and innovations has transformed the outlook of transport networks and assisted in utilizing multi-modal models to develop connectivity networks. Metro Rail as Mass Rapid Transport System (MRTS) is redefining the perception of people towards public transport – as these are smarter, faster and convenient. We explore some of the upcoming metro projects in this edition.

Moving from roads to sea, the country today is on a transformational mode in developing and equipping world-class international deepwater ports. Ports is one such sector which has been forging ahead as one of the main drivers of our economy despite the down slide in economy and market dynamics. The country has a long coastline of 7,517 kms with its 13 major and about 200 non-major ports. These play a critical role in the maritime transport and international trade activities. The robust opportunities offered by the sector have made Public-Private Partnership approach a favorite in project execution models. A proactive approach is also being witnessed by the governing bodies in our country, with the ambitious Maritime Agenda, National Maritime Policy etc. This sector enjoys 100 percent FDI permission for port development and 100 percent income tax exemption for a period of 10 years. With an objective to secure value for public money and provide efficient cost-effective services, the Planning Commission now wants rates at the ports owned by the states to be regulated. This move has attracted mixed responses from the stakeholders and major ports involved in the sector have welcomed this move as a proactive approach. The edition traverses across major port projects in India to feel the pulse of this sector.

Furthermore, the reforming pace of innovative technologies in fast-tracking and reforming the operational approach in roads, cement & concrete, railways, commercial vehicles and developing eco-friendly constructions are being explored. ICE Connect presents to its dedicated readers the distinct technological transformations, industry trends and evolving innovations transforming the pace of infrastructure sector in India.

ravi guptA Editor-in-Chief Ravi.Gupta@elets.in

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I C E CO ECT Connecting Technologies,Trends & Business

may 2014 volume 01 | issue 02

Infrastructure Construction Engineering

President: Dr M P Narayanan Editor-in-Chief: Dr Ravi Gupta

upcoming events

Editorial Team ICE CONNECT & GOVERNANCE Assistant editor: Rachita Jha Sr Correspondent: Kartik Sharma, Nayana Singh Souvik Goswami & Mohd. Ujaley Sr Copy Editor: Rajesh Sharma Correspondent: Veena Kurup Research Associate: Sunil Kumar EDUCATION Sr. Correspondent: Ankush Kumar Correspondent: Seema Gupta HEALTH Sr. Assistant Editor: Shahid Akhter Correspondent: Ekta Srivastava

GREEN CITIES FORUM

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20 June 2014 Pune, Maharashtra

egov.eletsonline.com | education.eletsonline.com | ehealth.eletsonline.com Write in your reactions to ICE CONNECT news, interviews, features and articles. You can either comment on the individual webpage of a story, or drop us a mail: editorial@elets.in EDITORIAL & MARKETING CORRESPONDENCE egov – Elets Technomedia Pvt Ltd Stellar IT Park, Office No: 7A/7B, 5th Floor, Annexe Tower, C-25, Sector 62, Noida, Uttar Pradesh - 201309, Phone: +91-120-4812600, Fax: +91-120-4812660, Email: info@egovonline.net egov is published by Elets Technomedia Pvt. Ltd in technical collaboration with Centre for Science, Development and Media Studies (CSDMS).

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Partner publications

Cover Cover story story -- ports ports

Mechanization Imperative to Meet Global Demands One of the country’s vital economic drivers, India’s port sector forges ahead to achieve the target of 3130 million tonnes in capacity by 2020 by adopting efficient technologies and enhancing the scope for private participation. Veena Kurup, Elets News Network (ENN) finds out…

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Cover story - ports

I

ndia is one among the most attractive economic investment destinations and has emerged as preferred hub for global trade activities. With a coastline of more than 7,517 kms with more than 200 ports, the country’s maritime activities play a vital role in leveraging the economic growth index. The country presently has 12 major ports and about 200 non-major ports across its vast coastline. The favorable location and availability of a long coastline has India’s standing as a prime destination for executing maritime economic activities. The increasing importance attached to maritime economic activities has further led to the development of many container terminals in the country.

However, the constantly increasing volume of global trade and the inflow of economic activities towards India have reinforced the need for advanced and efficient infrastructure facilities at the country’s ports. Aiming to meet the challenge of globally expanding maritime trade activities, modernization of ports is being upheld as an aspect of vital importance by the governing bodies as well as private port operators.

The push to equip the ports with advanced technologies and equipments to achieve operational efficiency has opened the doors for private players in the country’s port sector. Exploring these opportunities, the government also widely promotes the concept of public-private partnership (PPP) models for the development and operation of ports and container terminals in India. The sector has today opened doors for private port equipment manufacturers, technology providers and also private port developers and operators on a positive scale. A robust participation is also witnessed from the international port equipment players in exploring the opportunities put forth by the modernization of ports and container terminals. According to the sector analysts, non-major ports are expected to benefit on a larger scale as against the public majors due to the strong growth in India’s external trade.

Performance Index According to the recent ICRA data, the cargo throughput registered at major Indian ports could achieve only a modest growth of six percent in volumes in the second quarter of FY2014 as against the correspond-

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Cover story - ports

ing period a year ago. The reported volumes for the first half of the current fiscal posted a marginal improvement of 2.2 percent over the same period last year, registering 276 million tonnes against 270 million tonnes (MT).

The growth in the throughput at major ports, on consolidated basis, was dominated by Ennore, Paradip and New Mangalore Ports, respectively recording a year-on-year (y-o-y) growth of 59 percent, 33 percent and 16 percent respectively. The country’s largest port, Jawaharlal Nehru Port Trust (JNPT), however showed a decline in the container volumes with the index showing a five percent fall in TEU (twenty-foot equivalent unit) volumes during the second quarter of FY2014. According to the Ministry of Shipping, the capacity at major ports has increased to 800 million tonnes (December 2013) from the 575 million tonnes recorded in 2009. The ministry also disclosed that in the last four years, 88 new projects have been approved with an investment of Rs 42,953 crore, which is expected to make an additional capacity of 558 million tonnes per annum.

Non-major ports on the other hand reported a robust increase in throughput, wherein Adani Ports and Special Economic Zone, Essar Ports and Gujarat Pipavav Port led the growth index. Adani’s flagship Mundra Port’s growth momentum was driven mainly by the robust inflow of liquid cargo and dry bulk volumes; whereas Essar port terminals benefited from the new volumes of iron-ore terminal at Paradip, capacity expansion at Vadinar and Hazira during the quarter period on y-o-y basis. The growth reported at Pipavav Port stood at 30 percent in its volumes on y-o-y basis and 14 percent growth on a quarter-onquarter (q-o-q) basis on the back of increased container volumes.

Coal Cargo - Raising Bars The ban on mining activities has resulted in a considerable fall in the import and export of iron ore cargo. “The lull witnessed in the sector’s growth pace is mainly due to the reduction in the exports of iron ore cargo. However, a positive trend being witnessed is due to the increase in the inflow of coal and petroleum cargo,” opines Rajiv Agarwal, Managing Director and CEO, Essar Ports.

According to the Indian Ports Association, India’s major ports handled 17 percent more imported coal this fiscal, ended March. The major upswing in the coal imports is due to the escalation in the rush to add power capacity after years of under-investment. Coal and petroleum products are expected to remain as significant contributors to the cargo growth at major ports. As per the government records, while the revival of container volumes is dependent on overall manufacturing activities, iron ore exports could be favorably supported by the resumption of mining in certain areas.

The total coal cargo handled by the India’s 12 major ports escalated to 104.7 million tonnes in FY13-14 from 86.7 million tonnes in the corresponding period a year ago, states the Indian Ports Association.

PPP to Leverage Standards A major concern hovering on the sector is the need to develop and maintain deep sea ports and deeper drafts. “Today, the lack of deeper drafts has diversified the inflow of containerized trade, being transshipped to Indian ports to the neighboring regions of Colombo and

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I nterview

“India is facing a severe port infrastructure deficit” Says Ravin Wadhawan, Director – Port Solutions India, Terex India

P

ort operators are often tied with faster delivery of cargos and in minimizing the turnaround time. How equipped is Terex Port Solutions in meeting these demands?

With more pressure on construction companies, profitability, timing, and projects getting increasingly complex, jobsite logistics are getting more important.

Type of material to be lifted, timing, number of lifts, height, potential hazards or jobsite constraints, building architecture and shape, materials used etc are vital to be understood in the Planning Phase. On the basis of these multiple variables, a detailed analysis is made (Terex offers this to assist in the purchase) and respective solutions are offered. Terex Port

Cover story - ports

Solutions provides reliable solutions for rapid, safe, environmentally friendly, efficient container handling, bulk and general cargo with low downtimes and offers excellent return on investment.

What is the importance of energy efficiency in port solutions offered by Terex?

Terex Port Solutions offers a comprehensive portfolio of state-of-the-art cargo handling equipment, port management software and logistics solutions. Our Terex and Terex Gottwald machinery moves cargo quickly, safely and efficiently thanks to innovative features like our economical and environmentally compatible drive systems. We have diesel-electric drive technology, which is referred to as the hybrid drive. In this type of drive, excess energy recovered during braking and lowering motions is stored in transient storage media (consisting of high-performance capacitors, or ultra-caps) and then used for the next straddle carrier work cycle. In this technology the load surges on the primary energy source, being usually a diesel-generator set, which can be mitigated while allowing it to run in a smoother, energy efficient manner. According to operators, they see an immediate benefit with up to 20 percent less fuel consumed by Terex straddle carriers with hybrid drives compared to conventional, economical diesel-electric drives, depending on terminal and operating conditions. Hybrid operators have also reported reduced exhaust gas and noise emissions in the terminal.

Share with us your outlook upon the technical capabilities of the country’s majors involved in the port sector.

India is facing a severe port infrastructure deficit.

Despite a number of initiatives by the government, the port is still a major concern on the transportation front.

There are multiple problems hounding the Indian ports.

Inadequate capacity, long turnaround time, inadequate handling capacity, excessive documentation, storage space constraint are some of the major cause of concern for the sector. Some of the newer and private ports are better equipped. However in terms of technology used in port equipment we as a country are lagging. Modern technology and automation are still not being seriously considered. We believe alongside creation of small or large ports one should also invest in port management techniques and equipment that will enable huge leaps in efficiency. Terex Port Solutions, can provide a view into the latest technology available and being executed by us at international ports.

Singapore on a larger scale,” echoes a sector analyst. India’s location is also a hindrance in setting-up deep-water ports. As per the country’s geographic condition, Mumbai and few islands on the east and west coasts are the only regions that offer favorable locations for development of deep-water ports.

The situation has today escalated the requirement for effective dredging, to catch up the rapidly growing foreign trade activities. Dredging however, more than a process, is a detailed study and requires a planned approach for effective operations. According to industry experts, effective dredging can be achieved only through a detailed study on the wave flows, current behavior, weather conditions and systematic geographical data analysis. In addition, the use of costly machines and technologies makes this process even more expensive.

Participation of private players, in such situations, can effectively contribute in enhancing the port operations and technical efficiencies.

Private participation has been expanding in the port sector over the years, and public private partnership models (PPP) have emerged as the most technically apt developmental solution. “PPP models help in developing port operations and technologies in a planned manner, wherein the participation from private players can assist government bodies in enhancing the operational efficiencies by enabling access to globally advanced technologies,” adds Agarwal.

The Ministry of Shipping considers PPP as the best mode of development, wherein the tariff reforms has further enhanced the growth of the sector. Presently, 36 PPP terminals are operational at the major ports, while 34 are under construction. Exploring the positive approach from the private players into port operation and development activities, the government also outlined and initiated numerous initiatives favoring the participation of multinational and global players.

Future Prospective Raising total port capacity is outlined by the Ministry of Shipping as a need of the hour for meeting the dynamic growth in the maritime economic activities. By considering the prevalent scenario of economic activities, the Ministry has now set a target of achieving more than 3130 million tonnes of total port capacity by 2020. Apart from meeting the growing demand for import and export activities, the enhancement in port capacity can also enhance in the potential in accommodating large sized cargos and container volumes. Furthermore, about Rs 21,000 crore have been invested in 30 projects during the current financial year in achieving the target outlined by the Prime Minister’s Office for the Port sector. The government has also allowed foreign direct investment (FDI) of up to 100 per cent under the automatic route for projects related to the construction and maintenance of ports and harbours and a 10-year tax holiday for enterprises engaged in port.

The proactive approach and investment planning though outlines a positive sketch for India’s port sector, the ability for quick adoption of infrastructural facilities, need for developing world-class terminals with deep drafts and mechanization of port terminals prevails as a crucial and immediate requirement. Players involved in the sector though varies in reviewing the approach over government policies, uniformly upholds mechanization as an able and only solution to enhance the India’s port sector on a globally accredited level.

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In Person

Ports-A Critical Infrastructure for Indian Economy NN Kumar, Chairman, Jawaharlal Nehru

Port Trust, in an exclusive conversation with Veena Kurup, Elets News Network (ENN) shares his outlooks over the prevalent scenario of Indian ports, need for efficient port infrastructure and opinions on recent governing policies on port sector

Jawaharlal Nehru Port Trust is considered as a major player in the port sector. As a sector leader in this space, please throw light on the port sector in India?

Port sector in general and major ports in particular are in a rapid growth phase. Overall 23 projects out of the targeted 30 projects for FY13-14 involving a total capacity addition of 116 million tonnes (MT) were awarded in all major ports up to mid-February. The largest project in the port sector in India, i.e. Jawaharlal Nehru Port Trust’s (JNPT) fourth container terminal, has been awarded to PSA. Through this project the container handling capacity of JN Port will be more than double the present capacity. The overall traffic at Indian ports, including major and non-major, grew by a modest 2.2 percent year-on-year in FY13. Shipments of crude oil and petroleum products, containerized goods and coal which together accounted for 71.8 percent of the traffic at major Indian ports grew by 5.1 percent in FY13. This was particularly driven by an increase in shipments of crude oil and petroleum products due to the growth of India’s refining output and increase in inbound coal shipments for electricity generation and industrial activities. Container traffic (in TEUs – twenty-foot equivalent units) at major Indian ports remained subdued in FY13 and grew by a mere 0.8%. The situation was hurt by weak external demand for Indian goods as well as poor import demand due to slowdown in domestic economy.

However, the tentative demand recovery in Europe and the US can drive up global container trade as well as outbound container shipment volumes from Indian ports in 2014. In addition,

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In Person

a sustained growth in international trade led by increasing demand from Europe and the US along with containerization of existing cargo could lead to an improvement in container volumes, as the pace of cargo containerization in India is only 22 percent as against the 85 percent index in the developed nations.

Port is a critical infrastructure for our country and for the development of our economy. However, the importance of the ports is often not directly understood by the masses. The impacts on daily livelihood and inflation due to lack of required port capacity and inefficiency of equipment qualitative infrastructural facilities at the ports are often not clearly understood. The situation hence demands for a proactive approach from the stakeholders involved in the sector to create such awareness among the masses about the importance and need for efficient ports and port facilities for the development of our economy.

Recently, a drop was witnessed in the total cargo handled at JNPT, falling to 62.35 MT as against 64.49 MT in the previous year. What could be the possible reasons behind this fall in the cargo handled?

The containerized cargo handled by major ports was 7.47 million TEUs, marginally lower by 3.10 percent than the 7.70 million TEUs handled in the last year. Of this total index, JN Port handled 4.16 million TEUs which is 55.74 percent of the container traffic handled by the major ports. This year also JNPT retained its first position in container handling among major ports.

Cargo volumes fell in the last fiscal, mainly due to the labour troubles and cut in the output by one of our private terminals. Our own terminal registered a growth of 8.66 percent in volume, but our two private terminals reported lower volumes. While both these terminals were hit by a strike and go-slow action by employees, NSICT fearing revenue loss, reduced the volume after the tariff regulator cut its rate in 2012. This ultimately resulted in a fall in the cargo volumes handled during the period.

With the increasing private participation and development of ports in the neighboring state of Gujarat, do you see a shift in the cargo inflow from JNPT? The report of cargo shifting from JNPT to private port is untrue.

We have been handling four million plus TEUs of cargo for the last four years. What has shifted is the growth in the cargo volume. After 2006, we did not add any capacity. Cargo growth of last five years, i.e. 15 percent growth in the first three years and eight percent in the last two years (about three million TEUs) has moved to the other ports. Our port has always functioned at 100 percent capacity levels.

Essentially, the cargo that we could not handle moved to the neighbouring ports.

With the increasing maritime trade and economic activities, the need for deep-draft ports has been constantly on a rise. Can you detail

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In Person

us about the development of dredging activities being executed at JNPT? JNPT shares about 22 km long main harbor channel with the Mumbai Port. The Mumbai harbor channel is presently maintained to a depth of 10.7 – 11m below Chart Datum. JNPT has a navigational channel of 7.2 km in length, which is maintained to a depth of 11m below Chart Datum. Presently, large size vessels having a draught up to 12.5m navigate through Mumbai harbor main channel and JNPT channel, making use of the tidal window. The Port is deepening and widening the existing channel to accommodate up to 14m draught vessels (+6000 TEU vessels) by using the tidal window. The dredging component of the work was completed on 15 February 2014 and foundation work of the leading lights is in progress. Tata Consulting Engineers is the Engineer for this project.

Furthermore, under the Phase-II dredging project is in the planning stage, wherein the focus is to deepen the channels from 14m – 15m. The feasibility report for the Phase-II capital dredging project has been already submitted. The estimated project cost is Rs2,774 crore. The proposal for granting permission to carry out detailed proj-

ect report (DPR) with additional studies required for the completion of DPR has been already put forth before the Ministry of Shipping. We have also requested the Ministry to grant 75 percent cost of the project or budgetary support for this project.

Is development of facilities like World Class Terminals a need of the hour to accommodate large sized vessels and increasing water commutation networks?

The Ultra Large Container Carriers (ULCCs) have been deployed by Maersk and other big shipping lines in port overseas. Deployment of

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such vessels depends not merely on the fact that the port infrastructure supports such vessels or not. For such development, one needs to assess if the economy and the commercial activity of the region supports such volumes of trade and requires such vessels. In India, JNPT need to be a transshipment hub for such big ships to be able to call at our Port.

The Planning Commission now wants rates at ports owned by the states to be regulated.

Share with us your views on this policy. Can this be considered as a favorable measure?

New ports that receive viability-gap grants from the Indian government for construction to boost their financial viability will need to have a pre-determined tariff as a pre-requisite for availing the grant, as per the India’s apex planning body. The Commission says that that the plan is to have tariff caps, which is essential to prevent projects from being used for speculative gains. Such rate ceilings do not exist now at any of the ports owned by the States.

The Union Shipping Ministry, through its Maritime Agenda, has taken several steps to achieve a market-linked rate regime for the major ports to put them on par with the non-major counterparts. It is at this juncture that the Planning Commission has prescribed regulating rates. The Ministry had earlier tried to regulate ports owned by the States by drafting port regulatory authority legislation in 2001, but the plant was abandoned after the States and other stakeholders, including the Planning Commission objected the move.

However, this time, the chances of the plan sailing through are bright as it is linked with the viability-gap funding. All new ports to be constructed with such funding will have to follow a model concession agreement, which in turn, prescribes a tariff cap. The objective, according to the Commission is to secure value for public money and provide efficient and cost-effective services to the users. Financially-stressed States are unlikely to say no because it would eliminate the possibility of getting this fund from the Indian government to build new ports.

Even if no VGF is involved, the States may still be forced to follow the model document as the lenders may insist on adopting such standard frameworks approved by the Commission and would be comfortable on lending in the basis to protect their interests.

Moreover, the Commission also states that a tariff cap is necessary as the States are giving monopoly rights for the projects; this move guarantees and compensates the port operators from construction of competing ports within a 50km radius for 15 years.

Hence, irrespective of VGF received or not, the model document, instead of acting as a guiding principle for the State authorities, will ensure continued government control on rates, operations, cargo, customer composition, productivity and performance standards.

special focus - Cement & Concrete

Realty Sector Driving RMC Industry in India The market for ready-mix concrete is advancing at a slow pace in India as against the developed markets. Pushp Raj Singh, Executive Director Sales and Marketing, Dalmia Cement Bharat Limited – South anticipates the demand for eco-friendly products and structures to drive the sector

Pushp Raj Singh, Executive Director Sales and Marketing, Dalmia Cement Bharat Limited – South

T

he evolution of ready-mix concrete (RMC) has been a major growth driver for the infrastructure and construction industries. Though India’s RMC consumption is low compared to western and developed countries, the RMC industry is progressing.. While RMC consumption in western countries is nearly 60 percent of the cement production, in India it is just 6-7 percent.

Snail paced Growth Labour costs are a major cause behind the low demand for RMC in India. The cost of labour

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in western countries is very high, so minimal labour involvement and cost effective construction processes are preferred. This makes RMC a favorable option in such markets.

Though India also has high labour costs, however, the cost of labour has not outgrown the option of RMC. States like Kerala are moving towards RMC products, and contractors too are demanding RMC. But overall, the demand for RMC in India remains flat, mainly due to the shortages. The RMC market normally follows the cement market; with the cement market remaining on a flat index, a sluggish growth is being witnessed in the RMC sector.

special focus - Cement & Concrete

Dalmia Cements focuses on maintaining and developing its manufacturing plants and products by considering the requirement of energy efficiency. Eco-friendliness is maintained in the products from the source itself.

Focus is also emphasized on the utilization of power resources, coal and lignite consumption, wherein Dalmia Cements focuses to remain on the Green Path.

Benefits of Recycled Concrete

We have grown about 7-8 percent in the fiscal last year in the RMC sector.

Eco-friendly Technologies The rising concern over carbon emissions and adoption of eco-friendly technologies in the construction process has driven the demand of light weight products, ensuring dust prevention. We have also seen the industry move towards higher grade concrete products. Many large infrastructure investors now prefer such products. These products are particularly gaining prominence in the construction of large of infrastructure projects. However, the overall demand for such products is still at a nascent stage, driven by the cost efficiencies.

Dalmia Cements is currently upgrading our cement, which will be utilized for highend specifications and will be launching similar products in the future. This product will be used in large infrastructure projects, including high-rise structures. Dalmia Cement products are already being supplied to the Chennai and Kochi metro projects.

The infra-construction sectors are evolving constantly, and we anticipate a situation where the companies will opt for recycled concrete and eco-friendly products. RMC is pre-mixed, can be produced directly on-site and offers much higher consistency across projects. Many developers are moving to RMC products due to the time and cost benefits.

Tier-II and tier-III cities in semi-urban and rural regions are expected to be the major demand regions for RMC products in the future. We see a 5-6 percent growth from such regions. Dalmia Cement is already receiving requests and enquiries from these regions for developing RMC manufacturing units. Exploring this potential Dalmia Cement is in the process of developing an additional unit in Belgaum, Karnataka. The plant will manufacture cement which will be supplied to RMC and will have a 2.5 million tonnes capacity. The manufacturing unit is expected to commence its production by July or August this year.

Demand Drivers The real RMC demand in India is driven by the real estate sector, which contributes 76 percent of the total RMC consumption. After this are the infrastructure and industrial sectors, that contribute about 20 percent of the total RMC consumption.

In addition, the growth of power projects, especially hydro power projects, has positively impacted the RMC market in India.

Projects involving dam construction that require huge amounts of cement prefer RMC. Infrastructure and real estate plays a crucial role in driving the demand for Dalmia Cement products, wherein 25 percent is raised from the infra projects and the

balance is driven by the realty sector.

Combating Hurdles The RMC sector in India, due to the flat demand in cement consumption, has been progressing at a sluggish rate. Availability of credit remains as a major hurdle for the RMC manufacturers in India. The delayed execution of projects, lack of fund availability and shortage of aggregates further add pressure on the RMC market in India. The ease in availability and inflow of credit facilities can contribute to accelerate the demand and supply of the RMC market in India.

A stable government, policy initiatives and a more proactive approach to fast track infrastructure projects can surely fast track the demand and supply of RMC in the future.

West Bengal, Bihar and Gujarat were the major growth areas for the industry in last fiscal. Opportunities from the North-Eastern regions, due to the large infrastructure projects being executed, have also brightened the RMC market.

Expansion Plans Dalmia Cement has set up a plant in the north-eastern and enjoys a strong presence there. Its production capacity there is about 2 million tonnes and Dalmia Cement will soon develop a plant there. In the south, the Dalmia Cement plant has about 9 million tonnes of production capacity, and with the start of Belgaum unit, it will rise to 11.5 million tonnes. Dalmia Cement adds a new product after surveying the market. Once the Belgaum plant starts, a new product will be added in Dalmia Cement’s portfolio.

Dalmia Cement recently re-launched the Ultra with HALC technology in August 2013 and is receiving positive response from the market. In addition, two other products are streamlined to be soon launched. Dalmia is among the few manufacturers who offer oil-well cement, supplies cement for railway sleepers. The cement for railway sleepers is based upon a green initiative and replaces the need for wood as the construction material.

India is a developing country, the growth in GDP supplemented with new initiatives and investments on the infra projects and loosening of credit will accelerate the growth pace of RMC in the future.

May 2014 / iceconnect.eletsonline.com / ICE Connect

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