The Indian government recently published the Economic Survey for 2024-25, highlighting the cement industry’s robust performance in the last financial year. India is the second-largest cement producer in the world, following China.

The Indian cement industry comprises 159 integrated large cement plants, 128 grinding units, five clinkerisation units and 62 mini cement plants. Its annual installed capacity is approximately 639Mta, with a production of around 427Mta in FY23-24. Most of the cement plants in India are strategically located near sources of raw materials.

The survey indicates that approximately 87 per cent of the cement industry is concentrated in the states of Rajasthan, Andhra Pradesh, Telangana, Karnataka, Madhya Pradesh, Gujarat, Tamil Nadu, Maharashtra, Uttar Pradesh, Chhattisgarh, Odisha, Meghalaya, and West Bengal. The industry has sufficient capacity to meet domestic cement demand. 

Domestic cement consumption is about 290kg per capita, compared to a global average of 540kg per capita. The government’s focus on large-scale projects, such as highways, railways, and housing schemes, along with rural development and industrial growth, is expected to drive demand for cement significantly.

However, the cement industry does have an environmental impact. Efforts are underway to reduce carbon emissions from cement production by 2070.

Cement industry shares in FDI
From a sector perspective, the services sector remains the largest recipient of foreign direct investment (FDI), accounting for 19.1 per cent of total equity inflows in the 1HFY24-25. Other sectors attracting significant foreign investment include computer software and hardware (14.1 per cent), trading (9.1 per cent), non-conventional energy (seven per cent), and cement and gypsum products (6.1 per cent). Despite short-term volatility in global markets caused by inflationary pressures, rising interest rates in developed economies, and geopolitical tensions, the long-term outlook for FDI in India remains positive.

India’s strong economic fundamentals, ongoing structural reforms and expanding consumer market position make it a key destination for foreign investments across all sectors, including cement.

by Abdul Rab Siddiqqi, Pakistan