Kinjal Group: India’s Construction Sector Poised For $1.4 Trillion by 2025
As the construction industry races towards the $1.4 trillion milestone by 2025, it is crucial to develop infrastructure that withstands natural and man-made forces.
Divyesh Doshi - Director, Kinjal Group
India stands on the brink of a construction revolution. Amid a booming housing market and a robust infrastructure push by the government, the country is on track to become the third-largest construction market in the world by 2025, trailing after China and the United States.
As noted by the Housing and Urban Affairs Minister, this vibrant sector contributes 9% to India's GDP and employs around 71 million people, making it the second-largest employer in the nation. The industry's value is projected to soar to $1.4 trillion by 2025, with a staggering 13.3% growth recorded in the July-September quarter compared to the previous year, the highest in five quarters. This growth, surpassing expectations with a 9.6% real-time increase in 2023, underscores the sector's dynamism.
In today’s fast-evolving construction landscape, EPC (Engineering, Procurement, and Construction) firms are keys in shaping India's infrastructural future. These firms are increasingly leveraging innovative construction materials and methods, revolutionizing project design and execution. Prefabrication and modular construction, where components are manufactured off-site in controlled environments, are gaining traction. These techniques significantly shorten project timelines and eliminate common execution delays, challenging traditional construction practices.
Despite its potential, the construction sector faces significant challenges. Cost overruns and project delays, often due to fluctuating material prices and unforeseen site conditions, are common hurdles. The industry is also burdened by a complex web of regulations and processes. Additionally, a shortage of technically proficient workers affects both project quality and productivity. Integrating innovative technology is crucial to overcoming these challenges, making construction more sustainable and profitable.
In the current era, every economic action is evaluated for its carbon footprint. The construction industry, being power-intensive, significantly impacts the environment. This has driven the adoption of sustainable practices and products. The transition towards digitization and sustainable techniques is helping tackle critical issues. Energy-efficient products like rooftop solar panels, advanced HVAC systems, and energy-efficient lighting are becoming commonplace. The construction of green buildings and the use of steel structures are revolutionizing the industry, paving the way for a sustainable future.
The 21st century has witnessed unprecedented migration from rural areas to developed cities. A study projects India’s population to reach 1.64 billion by 2047, with an estimated 51% living in urban areas. To manage this urban influx, India’s construction industry must develop efficient, sustainable, and smart urban spaces. The government’s 'smart cities' initiative aims to address these needs, focusing on quality of life, economic opportunities, and a sustainable environment.
For the industry to thrive, adequate government intervention is essential to strengthen standards and support sector growth. Public-Private Partnerships (PPPs) have proven mutually beneficial, facilitating better project financing and management. Additionally, international partnerships can help the Indian construction sector leverage global advancements, accelerating progress.
As the construction industry races towards the $1.4 trillion milestone by 2025, it is crucial to develop infrastructure that withstands natural and man-made forces. Civil engineers, architects, and urban planners are focusing on resilient infrastructure—systems that absorb shocks, adapt to changing conditions, and quickly return to normal function. The use of high-strength, durable materials like fiberglass-reinforced concrete and steel alloys is on the rise, creating stronger structures. Real-time monitoring systems with sensors and data analytics are being integrated to assess structural health, enabling preventive measures to control potential disasters.
NBM&CW - July 2024
