A Chinese construction equipment manufacturer with operations in India has put itself on “watch” mode before going for expansion to get a clear picture on the emission norms that is set to hit the country in 2020.

LiuGong India, a 100 per cent subsidiary of Guangxi LiuGong, which operates 20 plants globally has earmarked an investment of around Rs 250 crore to expand capacity in India to cater to the rising demand for construction and mining equipment. But the firm is awaiting clarity on the applicability of Bharat Stage emission norms with BS-VI norms set to kick in from April 1, 2020. For construction equipment, the equivalent emission norm will be BS-IV.

“In 2020, India has to go for a major change in terms of the emission norms. We are watching that, whether we have to go for BS-IV excavators. There is indication that there will be BS-IV and in that case, it would be easier for us because in China and Europe we are already supplying BS-IV equivalent equipment,” said Nischal Mehrotra, director, sales and marketing, LiuGong India.

The company’s current portfolio includes wheel loaders, motor graders, compactors, bulldozers and excavators with manufacturing base located at Pithampur, Indore.

The company expects a turnover of Rs 600 crore in 2018, up from Rs 400 crore in the previous year. It is bullish on the excavator segment and is eying a market share of around 5 per cent by 2020 before the new norms come in. The company expects equipment prices to go up after the new norms come into effect.

“The Indian market offers bigger opportunity for all construction equipment companies. We are positive about the growth prospects and ready to take on a bigger challenge,” said Wu Song, managing director of LiuGong India. The company will also explore opportunities in West Asia and Africa for export from India.

However, the move to a newer emission norm may not be as easy with the industry demanding at least 2-3 years for making the transition.

Industry association Indian Construction Equipment Manufacturers’ Association has written to the department of heavy

industries seeking additional time, said Anand Sundaresan, past president of ICEMA. Availability of compliant diesel engines, fuel and homologation could be the major challenges for the industry.