The Gross Value Added by the Construction Sector in India is estimated to be about US$ 192 Billion in 2019-20 as compared to US$ 183.5 Bn in 2018-19.
Investments valued at US$ 965.5 Million will be required by the infrastructure sector by 2040 if growth proceeds on the current track. The Construction industry in value terms is expected to record a CAGR of 15.7% to reach $ 738.5 bn by 2022.
The construction industry contributes 55% share in the Steel industry, 15% in the Paint industry and 30% in the Glass industry in India. The Construction industry in India is expected to grow at 5.6% during 2016-20, compared to 2.9% during 2011-15. The activities that registered the highest growth include export cargo (10%), highway construction/widening (9.8%), power generation (6.6%), import cargo (5.8%) and cargo at major ports (5.3%).
Highway construction in India increased at 20.57 per cent CAGR between FY14-19. In FY19, 10,855 km of highways were constructed. NHAI will be able to generate revenue of Rs 1 lakh crore (US$ 14.31 billion) from toll and wayside amenities over the next five years owing to this new constructions.
Infrastructure sector plays a vital role in the growth and development of the Indian economy. Nearly, 9% of India’s GDP is spent on Infrastructure services. It comprises of construction of power projects, bridges, dams, roads and urban infrastructure development.
The infrastructure sector has become the biggest focus area of the Government of India in recent years. Under the Union Budget 2019-20, Rs 4,41,704.8 crore (US$ 63.20 billion) was allocated to the construction sector. As per the Union budget 2019-20, investment of Rs 5,000,000 crore (US$ 750 billion) is needed for railways infrastructure between 2018-30. In Union Budget 2020-21, the Indian government announced Rs 91.82 billion (US$ 13.14 billion) for road transport and highways development and construction.
According to the Department for Promotion of Industry and Internal Trade (DPIIT), construction development sector and infrastructure activities sector in India received FDI inflows amounting to US$ 25.37 billion and US$ 16.15 billion, respectively from April 2000 to December 2019.
India is expected to become the third largest construction market globally by 2022. The Indian construction market is expected to register a CAGR of 6% over the forecast period of 2019 – 2024.