Despite being a general election year, Indian cement demand growth unexpectedly stagnated for most of 2019. Furthermore, the ongoing COVID-19 crisis further restricted demand in the opening quarters of 2020. Going forward, considerable uncertainty remains and hope rests on an economic recovery led by a large-scale stimulus package.
Hopes of India’s cement market attaining an eight per cent growth rate continued to remain distant in 2019. After settling down from the cascading impact of the government’s 2016 demonetisation move, the growth rate plunged to 3.4 per cent last year.
Despite being a general election year, as well as elections in several states, cement demand remained suppressed for nearly three quarters of 2019. Typically, election years tend to see increased demand as governments rush to finish numerous promised infrastructure projects. However, only in the first three months of 2019 did cement demand manage a double-digit growth rate (+11.7 per cent). In the subsequent three quarters (ie, April–December 2019), the average growth unexpectedly stagnated below a percentage point.
