NEW DELHI: Cement manufacturers welcomed the Budget proposal to create a dedicated railway corridor for the cement sector, saying this will improve logistics efficiencies and boost multimodal connectivity. Finance Minister Nirmala Sitharaman in the interim Budget announced a thrust on infrastructure and an 11 per cent hike in outlay for the sector.
Sitharaman, while presenting the interim Budget 2024-25 on Thursday announced three major economic railway corridor programmes, which will improve the efficiency of logistic services and reduce cost.
“Three major economic railway corridor programmes will be implemented. These are energy, mineral and cement corridors, port connectivity corridors, and high-traffic density corridors,” Sitharaman said.
Cement Manufacturers’ Association (CMA) has applauded the Budget and said it will lend stability with growth to the country.
“The Cement Manufacturers’ Association welcomes the announcement for Cement corridors under the railways that would help improve logistics efficiencies and boost multimodal connectivity. We reiterate our commitment to being partners in progress in the nation’s evolving growth story,” said CMA President Neeraj Akhoury.
The cement industry also lauded the government’s plan to build 2 crore more homes for the rural poor in the next five years under the continuing PM Awas Yojana (Grameen).
CMA Vice President Parth Jindal said, “The allocation to key sectors such as housing is a step in the right direction, as it will foster growth with employment. The cement sector applauds the Finance Minister for providing a clear direction for the country’s future growth.”
JK Lakshmi Cement President and Director Arun Shukla said being a key player in the cement sector, it is eager to contribute meaningfully to the strategic railway corridor programmes.
“This, coupled with initiatives like the bio-manufacturing scheme, and multi-modal connectivity projects, creates a favourable environment for sustained economic growth and job creation. As we navigate the next five years of unprecedented development, JK Lakshmi Cement remains steadfast in its commitment to supporting the government’s vision of a Vikisit Bharat by 2047 and contributing to the nation’s journey,” said Shukla.
Nuvoco Vistas Corp Managing Director Jayakumar Krishnaswamy said the government’s efforts to improve port connectivity, decongest high-traffic rail corridors, and transform metro rail services are positive developments for the ready-mix concrete industry.
“As part of the PM Gati Shakti programme to foster strong multimodal connectivity, three proposed major economic railway corridors focusing on energy, minerals, and cement will improve logistics efficiency and reduce costs. This will benefit both the industry and the economy,” he said.
The initiative to construct two crore houses under the PM Awas Yojana and the progress of the Pradhan Mantri Awas Yojana (Grameen), with an additional two crore homes planned to be built over the next five years, is particularly noteworthy, Krishnaswamy added.
Rating agency Ind-Ra after the Budget said construction of economic corridors for cement under the PM Gati Shakti could improve logistics efficiency and reduce costs in the medium-term.
It believes that “cement demand is likely to be supported by the 17 per cent growth in budgeted capex over the Revised Estimate (RE) for FY24, as the infrastructure segment accounts about one-fourth of the cement demand”.
However, it also added that the pace of cement demand growth from infrastructure could moderate in FY25, in line with the moderation in the capex growth rate.
“The announcement of 20 million additional houses under affordable housing over the next five years will help to sustain the medium-term demand momentum,” it said.