CONSTRUCTION SECTOR OVERVIEW
Statistics, news & updates: everything you need to know about the Construction Industry in India
Summary/Snapshot
Construction Industry
- The construction industry consists of real estate and infrastructure construction and contributes around 9% to India’s GDP.
- It is the second-largest employer after agriculture, employing more than 51 million people.
- Sustainable development: India plans to spend $1.4 trillion on infrastructure 2019-23.
- There are huge opportunities in railways, energy, urban infrastructure, roadways and highways under the umbrella of the National Infrastructure Pipeline (NIP) with a budget allocation of $1.4 trillion on infrastructure under the next five years.
- Indian Railways has the highest-ever planned CAPEX of $29.52 billion.
- The overall investment in Urban transformation increased by 627% between 2014-2021 (when compared to 2004-2014).
- $2.5 bn is being provided for PMAY- Urban [Pradhan Mantri Awaas Yojna (“Affordable Housing for All”)]. This will help lay the foundations for 1.56 million new houses and complete 1.8 million existing houses, creating additional 7.8 million jobs.
Growth Drivers
- 100 Smart Cities Project planned.
- Construction of 8,500 km of road by March 2022.
- 11 Industrial corridors planned.
- Population growth, urbanization, industrialization and rise in disposable income
Sub industries
- Building Equipment
- Glass & glazing products
- Highways, Street & Bridge Construction
- Mechanical, Electrical & Plumbing equipment
- Residential remodelers
- Structural steel & pre-cast steel contractors
- Roofing & Flooring products
- Engineered wood & equipment
Opportunities
- Highways: 24% of the national highway network in India is four-lane, with immense scope for improvement.
- Airports: Upgrading and constructing new airports under Regional Connectivity Scheme.
- Housing: India will need to construct 43,000 houses every day to achieve the vision of Housing for All by 2022.
- Seaports: $82 billion planned investment in 574 projects by 2035.
- There are 1291 project opportunities worth $12.89 billion in this sector.
Challenges
- High quality, high specification products cannot compete in a price-sensitive market like India.
- Foreign companies rarely want to localize their offerings.
- India has low-cost manpower, thus contractors and builders hesitate in investing in automated equipment.
How we can help you:
- Product-Pricing analysis
- Strategies for – product/service localization
- Market research to sell effectively
Key Investment Opportunities
- Construction development in residential, retail, commercial and hospitality sectors, development of townships.
- Construction of roads, bridges, hotels, resorts.
- Technologies and solutions for smart, sustainable and connected cities and integrated townships.
- Technologies for the promotion of low cost and affordable housing.
- Green building solutions.
- Sustainable and environmentally friendly building materials.
- Training and skill development of construction sector workers.
- Urban water supply, urban sewage and treatment plants.
Recent Development
- Need for Affordable Housing: By 2030, more than 40% of the Indian population is expected to live in urban India (34% today) which is likely to create a demand for 25 million additional affordable units.
- Adoption of Green Building Solutions: Growth of cities would boost energy demand for powering buildings, making measures such as the revised Energy Conservation Building Code (ECBC), extremely important. Use of green building materials, and energy efficient HVAC and lighting systems are at the forefront of the new paradigm.
- Technology/AI Shaping the Industry: Cost efficiencies, faster construction and higher quality are driving implementation of techniques such as aluminium formwork, prefabricated buildings, building information modelling (BIM), etc.
Key Players in India
National
- L&T Engineering Construction & Contracts Division (ECC)
- Larsen & Toubro Infrastructure Development Projects Limited (L&T IDPL)
- Reliance Infrastructure Limited
- Tata Projects Limited
- Macrotech Developers Pvt Ltd (Lodha Group)
- Punj Lloyd Ltd
- Sadbhav Engineering Ltd
- Shapoorji Pallonji & CO. Ltd.
- Dilip Buildcon Ltd
- Nagarjuna Construction Company Limited
- Hindustan Construction Company
- Simplex Infrastructures Ltd
International
- ACS
- Hochtief Aktiengesellschaft
- EMAAR
- Strabag
- Bouygues
- China Communications Construction Group Ltd.
- Power Construction Corp. of China
- Skanska AB
- Ferrovial
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