India’s construction sector is forecast to grow at 7-8 percent each year over the next decade following the election of a new government, according to a news report by an international consultancy giant.
The country will see increased economic growth, and the removal of barriers to foreign investment will “spur demand for construction” over the coming 12 to 18 months, says PricewaterhouseCoopers India report.
The report has been prepared for The Big 5 Construct India exhibition in September and offers a snapshot of the US$157 billion Indian construction sector following the May elections.
“With a new government having been formed at the Centre, with a strong mandate to stimulate economic growth, the outlook for the sector appears positive,” it says.
An estimated US$1 trillion is being spent on infrastructure over the five years to 2017 and there is increased investment in industrial projects by the government. But it is the private housing sector that the PwC report highlights as a key growth area.
It says, “Demand for real estate has been one of the drivers of construction sector growth over the last 10 year. Improvement in economic conditions has the potential to drive demand for real estate, as housing continues to be a favoured investment asset among Indian households.”
The report’s positive forecast is reflected in a strong increase in interest for this year’s Big 5 Construct India show in Mumbai, said Muhammed Kazi, Senior Project Manager of The Big 5 Construct India, which runs from September 11 to 13 at the Bombay Exhibition Centre in Mumbai.
He said, “The country of 1.2 billion people is set to undergo a boost in the construction sector and this new report gives a snapshot of where the country is heading.
“The Big 5 Construct India is organised by the Federation of Indian Chambers of Commerce and Industry (FICCI), Ministry of Urban Development, in association with dmg events, will bring together suppliers and contractors for three days. Alongside the products, there will be the opportunity to examine a range of key industry issues, from sustainability and equipment to building regulations and alternative technologies, through workshops and seminars.”
The total construction market in India for FY2014 was US$157 billion, an increase of US$4 billion over FY2013. Infrastructure accounts for 49 percent, housing and real estate 42 percent and industrial projects 9 percent.