Increased impetus to develop infrastructure in the country is attracting both domestic and international players. Private sector is emerging as a key player across various infrastructure segments, ranging from roads and communications to power and airports. In order to boost the construction of buildings in the country, the Government of India has decided to come up with a single window clearance facility to accord speedy approval of construction projects. In 2018, India was ranked 44th out of 167 countries in World Bank's Logistics Performance Index (LPI) 2018. India was also ranked second* in the 2018 Agility Emerging Markets Logistics Index.
The cumulative growth in the index of eight core industries was 4.7 per cent in 2017-18 and 4.3 per cent year-on-year in FY19. In the road’s sector, the government’s policy to increase private sector participation has proved to be a boon for the infrastructure industry with a large number of private players entering the business through the public-private partnership (PPP) model. India is expected to become the third largest construction market globally by 2022. India has a requirement of investment worth Rs 50 trillion (US$ 777.73 billion) in infrastructure by 2022 to have sustainable development in the country.
During Dec 2018, infrastructure sector witnessed PE/VC twelve deals worth 500 million and eight US$ 1 billion plus deals. All villages in India will be connected through a road network by 2019 under Pradhan Mantri Gram Sadak Yojana (PMGSY). Road building in India has become the second cheapest in Asia. In August 2017, a new Metro Rail Policy was announced to boost private investment in the sector. The Government is also working on improving energy infrastructure in the country and investment opportunities worth US$ 300 billion will be available in the sector in the coming 10 years.
The infrastructure sector has become the biggest focus area of the Government of India. Under Union Budget 2019-20, US$ 63.20 billion was allocated to the sector.
According to Department for Promotion of Industry and Internal Trade (DPIIT), Construction Development sector and Infrastructure Activities sector received FDI inflows amounting to US$ 25.05 billion and US$ 14.81 billion, respectively from April 2000 to March 2019.
Note: * prepared by Agility for ranking emerging countries in terms of their logistics performance