Summary

India's construction industry regained growth momentum in 2018, with output expanding by 8.8% in real terms - up from 1.9% in 2017. This was driven by positive developments in economic conditions, improvement in investor confidence and investments in transport infrastructure, energy and housing projects. In the 2018-2019 budget, the government increased its expenditure towards infrastructure development by 20.9%, going from INR4.9 trillion (US$75.9 billion) in the Financial Year (FY) 2017-2018 to INR6.0 trillion (US$89.2 billion) in FY2018-2019.

The industry is expected to continue to expand over the forecast period (2019-2023), driven by the government’s efforts to develop the country’s infrastructure and improve housing sector. The government's continued investment in transport infrastructure, energy and residential projects under flagship programs such as Bharatmala scheme, Housing for All 2022, the UDAN (Ude Desh ka Aam Nagrik) scheme and the Aayushman Bharat program is expected to drive the growth of the industry over the forecast period. In January 2019, the government outlined the investments under the second phase of Bharatmala scheme, which will drive the road infrastructure developments in the country. Moreover, population growth and urbanization will also drive the need for better infrastructure facilities in the country.

The industry’s output value in real terms is expected to rise at a CAGR of 6.44% over the forecast period, compared to 4.31% during the review period (2014-2018).

GlobalData’s "Construction in India - Key Trends and Opportunities to 2023", report provides detailed market analysis, information and insights into the Indian construction industry, including -
- The Indian construction industry's growth prospects by market, project type and construction activity
- Critical insight into the impact of industry trends and issues, as well as an analysis of key risks and opportunities in the Indian construction industry
- Analysis of the mega-project pipeline, focusing on development stages and participants, in addition to listings of major projects in the pipeline.

Key Highlights

- GlobalData expects the residential construction market to retain its leading position over the forecast period, and account for 30.1% of the industry’s total value in 2023. Market expansion over the forecast period is expected to be supported by public and private sector investments in the construction of new residential buildings, in order to meet the demand for housing. In January 2019, the government allocated INR1.0 trillion (US$14.7 billion) to construct affordable houses in the country by 2022.
- Forecast-period growth in the infrastructure construction market will be supported by public and private sector investment in transport infrastructure. Under the Pradhan Mantri Gram Sadak Yojana (PMGSY), the government aims to build roads in the rural and backward areas in the country. In February 2019, the government increased the allocation under PMGSY by 22.6%, going from INR155.0 billion (US$2.2 billion) in FY2018-2019 to INR190.0 billion (US$2.8 billion) for FY2019-2020.
- GlobalData expects the energy and utilities construction market to record a forecast-period CAGR of 10.83% in nominal terms, driven by the government’s aim to increase the share of renewable energy in terms of total energy consumption and encouraging investment in renewable energy infrastructure. The government aims to increase the share of renewable energy in total installed power capacity from 10.6% in 2018 to 40.0% by 2030. Accordingly, it aims to generate 175GW of electricity through renewable sources by 2022.
- Forecast-period growth in the institutional construction market will be supported by public and private sector investment in educational and healthcare building construction projects. In the 2019 budget, the government increased its expenditure on the education sector by 10.4%, going from INR850.1 billion (US$12.3 billion) in FY2018-2019 to INR938.5 billion (US$13.7 billion) in FY2019-2020. Moreover, the government increased the expenditure on healthcare by 16.3%, going from INR528.0 billion (US$7.6 billion) in FY2018-2019 to INR614.0 billion (US$9.0 billion) in FY2019-2020.
- The total construction project pipeline in India - as tracked by GlobalData, and including all mega projects with a value above US$25 million - stands at INR82.5 trillion (US$1.2 trillion). The pipeline, which includes all projects from pre-planning to execution, is skewed towards early-stage projects, with 60.7% of the pipeline value being in projects in the pre-planning and planning stages as of February 2019.

Scope

- This report provides a comprehensive analysis of the construction industry in India.
- Historical (2014-2018) and forecast (2019-2023) valuations of the construction industry in India, featuring details of key growth drivers.
- Segmentation by sector (commercial, industrial, infrastructure, energy and utilities, institutional and residential) and by sub-sector
- Analysis of the mega-project pipeline, including breakdowns by development stage across all sectors, and projected spending on projects in the existing pipeline.
- Listings of major projects, in addition to details of leading contractors and consultants.

Reasons to buy

- Identify and evaluate market opportunities using GlobalData's standardized valuation and forecasting methodologies.
- Assess market growth potential at a micro-level with over 600 time-series data forecasts.
- Understand the latest industry and market trends.
- Formulate and validate strategy using GlobalData's critical and actionable insight.
- Assess business risks, including cost, regulatory and competitive pressures.
- Evaluate competitive risk and success factors.

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