India is laying the groundwork for a major shift in its construction equipment sector, aiming to reduce reliance on imports and supercharge domestic manufacturing. Union Heavy Industries Minister H.D. Kumaraswamy unveiled the vision for the newly announced Construction and Infrastructure Equipment (CIE) scheme, highlighting its potential to fortify local supply chains and empower small businesses.

Key facts

  • Scheme announced in Union Budget 2026-27 with initial estimated cost of ₹200 crore
  • Media reports suggest broader program with ₹11,500 crore outlay over seven years
  • India is world's third-largest construction equipment market after China and U.S.
  • Industry valued at ₹97,500 crore in 2024-25, employs ~10 lakh people directly
  • Projected to reach ₹2.28 lakh crore by 2029-30

Building from the Ground Up

The CIE scheme, while still awaiting finalized modalities, represents a strategic push to create what Kumaraswamy calls a "globally competitive OEM ecosystem." Speaking at the Indian Construction Equipment Manufacturers’ Association conference in New Delhi on September 1, 2026, the minister stressed that such an ecosystem depends entirely on a "strong and capable supplier base." This puts micro, small and medium enterprises (MSMEs) squarely at the center of the plan, signaling a commitment to inclusive industrial growth.

“A globally competitive OEM ecosystem can only be built on the foundation of a strong and capable supplier base,” Mr. Kumaraswamy said.

Technology as the Next Growth Engine

Beyond scale, the minister pointed to innovation as the critical driver for the sector's future. He pledged continued government support for technology adoption and capacity building, specifically calling for accelerated development of fuel-efficient, low-emission, and digitally-enabled machinery. The ambition is clear: Indian manufacturers should produce not just for the domestic market, but for the world.

A Sector Poised for Expansion

The push comes as the Indian construction equipment industry stands on the cusp of significant growth. Already a major global player, the sector is projected to more than double in value within five years. The CIE scheme is designed to capture this momentum, turning national ambition into manufacturing reality and ensuring that the benefits of growth are widely shared across the supply chain.