In the Union Budget 2025-26, capital investment outlay for infrastructure has been increased to Rs. 11.21 lakh crore (US$ 128.64 billion), which would be 3.1% of GDP. The Infrastructure Finance Secretariat is established to enhance opportunities for private investment in infrastructure that will assist all stakeholders in more private investment in infrastructure.
The Indian government has introduced various formats to attract private investments, especially in roads and highways, airports, industrial parks and higher education and skill development sectors. The Second Asset Monetization Plan aims to reinvest Rs. 10 lakh crore (US$ 115.34 billion) in capital for new projects over the period 2025-30 to recycle capital and attract private sector participation.
Cement demand in India is projected to remain robust in the coming years, with a Compound Annual Growth Rate (CAGR) of 7-8% over FY25E-27E, according to a report by JM Financial.
Union Minister of Finance Ms. Nirmala Sitharaman announced plans to connect 120 new airports over the next 10 years, benefiting four crore additional passengers.
As per ICRA, India is expected to maintain current road construction momentum, adding up to 13,000 kilometres in the 12 months through March 2025, an annual increase of 5-8%.
India has the second largest road network in the world and its National Highways expanded from 65,569 km in 2004 to a total length of 1,46,145 km in 2024, forming the primary arterial network of the country.
The Government of India has undertaken several initiatives to enhance and strengthen the National Highways network through flagship programmes such as the Bharatmala Pariyojana which includes the subsumed National Highway Development Project (NHDP), the Special Accelerated Road Development Programme for the North-East Region (SARDP-NE), and many more ongoing projects.
India’s logistics market is estimated to be US$ 317.26 billion in 2024 and is expected to reach US$ 484.43 billion by 2029, growing at a CAGR of 8.8%. The Ministry of Commerce and Industry, states that the logistics sector accounts for 5% of India's GDP and provides jobs for nearly 2.2 crore Indians.
FDI in construction development (townships, housing, built-up infrastructure and construction development projects) and construction (infrastructure) activity sectors stood at Rs. 1,32,601 crore (US$ 26.76 billion) and Rs. 2,50,628 crore (US$ 35.24 billion), respectively, between April 2000-September 2024.
The production of Coal, Electricity, Steel, Cement, Fertilizers, Refinery Products and Natural Gas increased in January 2024.
The combined Index of Eight Core Industries (ICI) increased by 6.2% (provisional) YoY in April 2024 compared to April 2023.
The combined Index of Eight Core Industries (ICI) increased by 4.4% (provisional) YoY in April-January 2025 compared to April-January 2023.
In January 2025, the overall index of eight core industries stood at 161.9 driven by the production of coal, refinery products, fertilizers, steel, electricity and cement industries.
On March 12, 2024, Prime Minister flagged off 10 new Vande Bharat trains.
In February 2024, NTPC Limited and National Aluminium Company Limited (NALCO), a Navaratna company, inked a non-binding memorandum of understanding (MoU) to investigate ways to provide at least 1200 MW of continuous power supply around the clock to meet NALCO's needs for expanding the capacity of its smelter plant in Odisha.
In August 2022, the Prime Minister of India inaugurated the nation's first second-generation (2G) ethanol project in Panipat, built at an estimated cost of over Rs. 900 crore (US$ 108.7 million) by Indian Oil Corporation Ltd. (IOCL).
The ‘Green Energy Project’ is an initiative to make Indian Railways environment-friendly by focusing on renewable sources of energy.
Indian Railways aims to more than double its net earnings to Rs. 3,041.3 crore (US$ 348.01 million) in FY26, driven by higher passenger and freight revenue. The budget includes manufacturing 100 new Amrit Bharat, 50 Namo Bharat, and 200 Vande Bharat trains. Revenue receipts are projected to exceed Rs. 3,00,000 crore (US$ 34.33 billion) for the first time.
Under the Union Budget 2025-26, the government has allocated record CAPEX of Rs. 2,65,200 crore (US$ 31.43 billion) for Railways.
As of November 2024, the Indian Railways has transported 1,038 Million Tonnes (MT) of freight, which is a 2.1% increase from the previous year.
In April 2023, the Network Planning Group (NPG) under the PM GatiShakti initiative approved four railway projects related to the doubling of lines between Aurangabad and Ankai in Maharashtra.
In February 2023, the Network Planning Group (NPG) under the PM GatiShakti initiative approved three railway projects related to the doubling of lines between Aurangabad and Ankai in Maharashtra.
In FY24, cement production increased by 9% driven by the government’s push for infrastructure development and increased real estate activity.
As of March 2022, the Ministry-wise progress of projects is as follows:
- Ministry of Road Transport and Highways has completed 1,41,190 km of National Highways out of the set target of 2,00,000 km for 2024-25.
- Department of Telecommunication has created the OFC (Optical Fibre Cable) network of 33,00,997 km against the set target of 50,00,000 km for 2024-25.
- Ministry of Petroleum has completed the laying of a gas pipeline of 20,000 km out of 34,500 km targeted for the same period.
- Ministry of Power has surpassed its target for laying the transmission network of 4,54,200 km.
As of January 2025, India’s total installed electricity generation capacity stood at 466 MW.
As of January 2025, India’s installed renewable energy capacity has increased to 212.17 Giga Watts (including large Hydro).
As of January 2025, the installed solar, wind and other renewable energy capacity stands at 165.20 GW.
Total FDI inflows in the power sector reached Rs. 1,67,700 crore (US$ 19.59 billion) between April 2000-September 2024, accounting for 2.76% of the total FDI inflow in India.
In a recent evaluation under the PM GatiShakti initiative, five significant infrastructure projects including a road and an airport were reviewed for their integration with the National Master Plan. These projects aim to enhance logistical efficiency, minimize travel times, and provide substantial socio-economic benefits across various regions.
India has the second largest road network in the world and its National Highways expanded from 65,569 km in 2004 to a total length of 1,46,145 km in 2024, forming the primary arterial network of the country. The Government of India has undertaken several initiatives to enhance and strengthen the National Highways network through flagship programmes such as the Bharatmala Pariyojana which includes the subsumed National Highway Development Project (NHDP), the Special Accelerated Road Development Programme for the North-East Region (SARDP-NE), and many more ongoing projects.
Telangana Chief Minister Mr. Revanth Reddy instructed the State Finance department officials to release Rs 1,000 crore for the construction of rural roads.
Union Minister of Road Transport & Highways, Mr. Nitin Gadkari stressed infrastructure's role in India's development, highlighting Rs. 50,000 crore (US$ 5.77 billion) projects in J&K, including four major corridors for better transport and communication.
National Highways play a very important role in the economic and social development of the country by enabling efficient movement of freight and passengers and improving market access. MoRTH and its implementing agencies have implemented multiple initiatives in the last 8 years to augment the capacity of the National Highway infrastructure in India.
In the Union Budget 2025-26, the government has decided to allocate Rs. 2.87 lakh crore (US$ 32.94 billion) towards the Ministry of Road with a target of Rs. 35,000 crore (US$ 4.02 billion) in private sector investment.
The Indian government raised the Union Housing and Urban Affairs Ministry's budget by 18% to Rs. 96,777 crore (US$ 11.07 billion) for FY26, with major allocations for urban development, housing, and street vendor support.
Union Minister of Road Transport & Highways, Mr. Nitin Gadkari announced that road projects worth Rs. 3,00,000 crore (US$ 392.21 million) will be completed in Kerala during his tenure, including Rs. 50,000 crore (US$ 5.74 billion) worth of upcoming projects.
The Indian government raised the Union Housing and Urban Affairs Ministry's budget by 18% to Rs. 96,777 crore (US$ 11.07 billion) for FY26, with major allocations for urban development, housing, and street vendor support.
A network of 35 Multimodal Logistics Parks is planned to be developed as part of Bharatmala Pariyojana, with a total investment of about Rs. 46,000 crore (US$ 5.5 billion), which once operational, shall be able to handle around 700 million metric tonnes of cargo. Of this, MMLPs at 15 prioritized locations will be developed with a total investment of about Rs. 22,000 crore (US$ 2.6 billion).
The government is working towards the development of a national highway network of 2 lakh kilometres by 2025.
During FY24, Total revenue of Indian Railways stands at US$ 28.89 billion (Rs 2.40 Lakh crore) as on 15th March. Last year on 15th March, total Revenue was US$ 26.84 billion (Rs 2.23 Lakh crore).
Under the Union Budget 2025-26, the government has allocated record CAPEX of Rs. 2,65,200 crore (US$ 31.43 billion) for Railways.
As of November 2024, the Indian Railways has transported 1,038 million tonnes (mt) of freight, which is a 2.1% increase from the previous year.
For 2023-24:
- Total revenue from traffic is estimated to be Rs. 2,64,600 crore (US$ 32.17 billion), an increase of 9% over the previous year.
- Freight revenue is estimated to be Rs. 1,79,500 crore (US$ 21.82 billion), an increase of 9% over the previous year.
- The passenger revenue is estimated to be Rs. 70,000 crore (US$ 8.51 billion), an increase of 9% over the previous year.
- Vision 2024 has been envisaged to achieve targets of 2024 MT freight loading by 2024.
Indian Railways has planned to install 1000 MW of solar power plants and about 200 MW of wind plants by 2022-23. Out of this, about 204.82 MW (101.42 MW solar and 103.4MW wind power) renewable power has already been set up.
Indian Railways Coach production units have ramped up LHB coach production by manufacturing 4,175 LHB coaches in 2022-2023, till 31st January, to ensure convenient and faster mobility.
Indian Railways will achieve 100% electrification by FY26, with over 97% already completed, and is rapidly adopting renewable energy, says Union Minister of Railways Mr. Ashwini Vaishnaw.
Indian Railways aims to more than double its net earnings to Rs. 3,041.3 crore (US$ 348.01 million) in FY26, driven by higher passenger and freight revenue. The budget includes manufacturing 100 new Amrit Bharat, 50 Namo Bharat, and 200 Vande Bharat trains. Revenue receipts are projected to exceed Rs. 3,00,000 crore (US$ 34.33 billion) for the first time.
As of January 2025, India’s total installed electricity generation capacity stood at 466 MW.
For FY26, the total budgetary allocation towards the Ministry of Power stood at Rs. 21,847 crore (US$ 2.51 billion).
In the fiscal year 2022-23, India expected to commission 10 thermal power units of an aggregate 7,010 MW capacity.
Cumulatively 39 thermal power plants with a capacity of 27,550 MW are under construction and will likely take another four years to complete.
India's power consumption grew by 13.31% on an annual basis to 127.39 billion units (BU) in September 2022 and 11.65% in H1 FY23.
Thermal power plant load factor or capacity utilization will improve to 63% in FY24, fueled by strong demand growth along with subdued capacity addition in the sector.
As part of the Union Budget 2025-26, the government allocated Rs. 24,224 crore (US$ 2.78 billion) for solar energy, including Rs. 1,500 crore (US$ 172.14 million) for solar power (grid), Rs. 2,600 crore (US$ 298.37 million) for KUSUM, and Rs. 20,000 crore (US$ 2.30 billion) for PM Surya Ghar Muft Bijli Yojana.
In February 2024, as part of the Pradhan Mantri Suryodaya Yojana, the government announced of installing rooftop solar panels in 1 crore households to gain upto 300 units of free electricity each month.
India road logistics industry will grow at 3-6% in FY25 as per ICRA.
India’s logistics market is estimated to be US$ 317.26 billion in 2024 and is expected to reach US$ 484.43 billion by 2029, growing at a CAGR of 8.8%.
India intends to raise its ranking in the Logistics Performance Index to 25 and bring down the logistics cost from 14% to 8% of GDP, leading to a reduction of approximately 40%, within the next five years.
The logistics sector has attracted investments of Rs. 8,257 crore (US$ 997.4 million) since the beginning of the year 2022.
The growth of third-party logistics is the second-largest incentive causing the rise in demand for warehouses.
The warehousing market in India is expected to grow to Rs. 2243.79 billion (US$ 27 trillion) by 2026, expanding at a CAGR of 10.90%, as per the Warehousing Market in India 2022 Report.
Real estate PE investments registered an increase of 28% in Q1 FY23 as compared to Q1 FY22 driven by improved market sentiments, widespread vaccine coverage, and the lifting of lockdown restrictions helped this revival.
In addition, with India’s significant policy changes, the interest of foreign investors to increase their footprint in the country by way of investments in the warehousing and logistics sectors has witnessed an uptick.
In January 2023, the Construction arm of Larsen & Toubro secured orders for its power transmission & distribution and buildings & factories businesses to establish a 112.5MW Solar Power Plant in West Bengal and to construct a 600-bed super speciality hospital in Mumbai, respectively.
Larsen & Toubro (L&T) to form L&T Green Energy Council, a think-tank comprising eminent thought leaders, in a significant step towards building a global green energy business.
In August 2023, Bharat Heavy Electricals Ltd. (BHEL) and Greenstat Hydrogen India Pvt. Ltd. (GHIPL) signed an MoU for ‘Potential Collaboration Opportunities in Green Hydrogen and Derivatives in the Hydrogen Value Chain’. This MoU will help in contributing towards the country's 'National Hydrogen Mission' aimed at making India 'AatmaNirbhar' in this area.
In December 2022, BHEL formed a consortium with Titagarh Wagons and is among five entities which have bid for the mega Rs. 58,000 crore (US$ 7 billion) contract to manufacture 200 Vande Bharat trains and maintain them for the next 35 years.
In December 2022, Mr. Nitin Gadkari, Minister of Road Transport and Highways inaugurated and laid the foundation stone of 8 National Highway projects of 226 km length worth Rs. 1800 crore (US$ 217.4 million) at Igatpuri, Nashik, Maharashtra.
In December 2022, Mr. Nitin Gadkari, Minister of Road Transport and Highways inaugurated 7 National Highway projects worth Rs. 2,444 crore (US$ 295 million) with a total length of 204 km in Rewa, Madhya Pradesh.
In November 2022, the Prime Ministry of India laid the foundation stone of various road projects worth over Rs. 2200 crore (US$ 2.6 billion), namely the Medak-Siddipet-Elkathurthy section of NH-765DG; Bodhan-Basar-Bhainsa section of NH-161BB; Sironcha to Mahadevpur Section of NH-353C in Telangana.
In October 2022, the Prime Ministry of India laid the foundation of road and ropeway projects worth more than Rs. 3,400 crore (US$ 410 million) in Mana, Uttarakhand.
In October 2022, National Highways Infra Trust (NHAI InvIT), the infrastructure investment trust sponsored by the National Highway Authority of India (NHAI) to support the Government of India's National Monetization Pipeline, raised a sum of Rs. 1,430 crore (US$ 172.6 million) from domestic and international investors through placement of its units, for part funding its acquisition of three additional road projects from NHAI.
As many as 52 critical infrastructure gap projects identified by MoPSW for connecting maritime ports and IWTs (Inland Waterway Terminals) to be taken up under PM Gati Shakti National Master Plan. Currently, the DPR of a total of 56 projects (including 11 IWT projects) under this category with a total of 1215 km length are under the bidding stage for the feasibility assessment of these projects, which is being carried out by NHAI.
With a 10.1% increase in the current fiscal year, capital expenditures (capex) are on the rise, which bolsters ongoing infrastructure development and fits with Vision 2027 goals for India's economic growth to become a US$ 5 trillion economy. In order to anticipate private sector investment and to address employment and consumption in rural India, the budget places a strong emphasis on the development of roads, shipping, and railways.
India's ambitious plan calls for spending US$ 1.723 trillion (approximately Rs. 143 trillion) on infrastructure between FY24 and FY30, with a particular emphasis on power, roads, and developing industries like renewable energy and electric vehicles.
Prime Minister Mr. Narendra Modi emphasized that India is committed to attaining net-zero carbon emissions by 2070, and that the country's ambitious goal of 500 gigawatts (GW) of renewable capacity by 2030 should be met. In order to make this possible, he unveiled a plan to raise the proportion of gas in India's energy mix to 15% by 2030, which will involve spending roughly US$ 67 billion over the course of the following five to six years.
In the Union Budget 2025-26 the Department of Telecommunications and IT was allocated Rs. 81,005.24 crore (US$ 9.27 billion).
Three significant economic railway corridor initiatives—energy, port connectivity, mineral and cement, and high traffic density—will be carried out by the railway industry. Additionally, in order to improve passenger safety, convenience, and comfort, forty thousand standard rail bogies will be converted to Vande Bharat standards.
As part of the PM Awas Yojana (Grameen), two crores more houses to be taken up in the next five years. Despite COVID challenges, the target of three crore houses under PM Awas Yojana (Grameen) will be achieved soon.
