China tightens export curbs on construction machines, raising concerns for India

China is tightening export controls on specialised construction equipment, including tunnel-boring machines, in a move that could affect India's infrastructure projects and expose its dependence on Chinese machinery.

The new restrictions cover equipment used to build tunnels for roads, railways and metro networks, as well as machines that spray concrete at high altitudes.

Beijing has cited their potential military and civilian applications, warning that exports to "sensitive countries and regions with disputes with China" will face stricter rules, Bloomberg reported.

The curbs are significant for India, which relies on Chinese tunnel-boring equipment for infrastructure expansion, including projects along the disputed Himalayan border. The restrictions, due to take effect later this month, also cover components and spare parts, potentially complicating maintenance of machinery already in use.

China accounts for around 70 per cent of the global tunnel-boring machine market, according to figures cited by Bloomberg. India has previously faced procurement delays. In 2024, China delayed efforts by German manufacturer Herrenknecht AG to supply machines for projects including the Ahmedabad-Mumbai bullet train and the Delhi Metro.

Ajay Srivastava, founder of the Global Trade Research Initiative, warned that restrictions on components could create problems for existing equipment. "When there is heavy wear and tear in these machines we require regular supply of parts," he said.

India is seeking to reduce its dependence on imported machinery. The government is considering a $1.2-billion incentive scheme to promote domestic manufacturing of equipment such as tunnel-boring machines, firefighting systems and elevators. The proposed programme is expected to attract $1.8 billion in fresh investment over seven years.

Road Transport and Highways Minister Nitin Gadkari has said India aims to invest up to $9.6 billion in tunnelling over the next five years and has urged domestic manufacturers to develop tunnel-boring machines.

Larsen & Toubro is working on a prototype machine. R Shankar Raman, the company's president, said domestic production could eventually serve its own projects and other buyers. However, he cautioned that Indian manufacturers would face a cost disadvantage against Chinese companies benefiting from large-scale production.

While the restrictions could delay some infrastructure projects, they may also accelerate India's efforts to build domestic manufacturing capacity and attract alternative suppliers from countries such as Germany, the US and Japan.