Trade Analytics
Road
The Government of India aims to complete 200,000 km national highways by 2022.

Road and Infrastructure Industry Analysis

Latest update: December, 2019

Growth

 

 

Last Updated: December, 2019

India has second largest road networks in the world, spanning a total of 5.5 million kilometres (kms).

The private sector has emerged as a key player in the development of road infrastructure in India. Increased industrial activities, along with increasing number of two and four wheelers have supported the growth in the road transport infrastructure projects. The government’s policy to increase private sector participation has proved to be a boon for the infrastructure industry with many private players entering the business through the public-private partnership (PPP) model.

With the Government permitting 100 per cent foreign direct investment (FDI) in the road sector, several foreign companies have formed partnerships with Indian players to capitalise on the sector's growth. Cumulative FDI in construction development^ since April 2000 stood at US$ 25.31 billion as of September 2019. MAIF 2 became the first largest foreign investment in Indian roads sector under TOT mode worth Rs 9,681.5 crore (US$ 1.50 billion). The government’s move to cut GST rates on construction equipment from 28 per cent to 18 per cent is supposed to give boost to the industry.

Transfer to National Investment Fund (NIF) is estimated at Rs 6,070 crore (US$ 868.51 million) for 2019-20. The Ministry of Road Transport & Highways is expected to award road projects with a total length of around 4,500 km worth Rs 50,000 crore (US$ 7.15 billion) in 2020.

The Ministry of Road Transport and Highways has fixed a target for construction of 12,000 km national highways in FY20. The length of national highways constructed reached 1,31,326 kms. The Government of India aims to construct 65,000 km of national highways at the cost of Rs 5.35 lakh crore (US$ 741.51 billion) by 2022. In the coming years, NHAI’s increased delegation autonomy along with Bharatmala Pariyojana initiative is expected to enable growth in awarding momentum. ^ NHs under the Bharatmala Pariyojana programme which aims to optimise the productivity of freight and passenger movement by filling the critical infrastructure gaps also sight to increase the number of districts with national highway linkages from 300 to 550.

The Ministry has allocated Rs 3,150 crore (US$ 450.71 million) for maintenance of roads and highways in FY20, also allocated Rs 280 crore (US$ 40 million) towards road transport and safety. The Government of India has set a target to complete one road projects every two days as a part of 100-day plan. Government plans to invest Rs 15 lakh crore (US$ 214.62 billion) in the next five years.

As per Union Budget 2019-20, Pradhan Mantri Gram Sadak Yojana (PMGSY) has brought many socio-economic gains in the rural areas. Under the Union Budget 2019-20, the Government of India allocated Rs 19,000 crore (US$ 2.63 billion) for the Pradhan Mantri Gram Sadak Yojana (PMGSY). As pe Union Budget 2019-20, 30,000 kms of PMGSY roads have been built using Green Technology, Waste Plastic and Cold Mix Technology, thereby reducing carbon footprint.  PMGSY-III is envisaged to upgrade 1,25,000 kms of road length over the next five years, with an estimated cost of Rs 80,250 crore (US$ 11.48 billion). To widen and revamp 1.25-lakh km of roads, Government of India has approved the launch of Phase-III of its rural road programme Pradhan Mantri Gram Sadak Yojana (PMGSY).

As per the Union Budget 2019-20, Government proposed to permit investments made by FIIs/FPIs in debt securities issued by Infrastructure Debt Fund – Non-Bank Finance Companies (IDF-NBFCs) to be transferred/sold to any domestic investor within the specified lock-in period.

Note: TOT - toll operate transfer, * - investments include Budgetary support, IEBR refers to Internal and Extra Budgetary Resources and constitutes the resources raised by the public sector units through profits, loans and equity and Private sector investments; according to Ministry of Road Transport and Highways, ^ - Crisil Research

Indian Road Industry Report (December, 2019)
Download PDF Download PDF  (Size: 604.42 KB )

Click to access the Road Industry Archived Report

Posters

Brand India Pharma

ROADS INDIA

+ More >

Brand India Pharma

IBEF Publications

IBEF Publication

Agri Export Policy - Towards smoother trade, wider global presence

English

+ More Publications >

IBEF Publication

IBEF Blog - INDIA ADDA – PERSPECTIVES ON INDIA More

author_logo-ibef1.jpg SUSTAINABLE AGRICULTURE - TURNING TO ORGANIC AND NATURAL FARMING
IBEF, Knowledge Centre

Agriculture and its allied sector are crucial for the development of a country, especially for India where it is the largest source of livelihood. The sector plays a majo...

author_logo-ibef1.jpg Digital India: Power To Empower
IBEF, Knowledge Centre

The global economy is presently going through the fourth Industrial Revolution, also known as the Digital Revolution. This revolution is changing not only the way we inte...

author_logo-ibef1.jpg India's leapfrog strategy from BS-IV to BS-VI
IBEF, Knowledge Centre

The Ministry of Road Transport and Highways (MoRTH) issued a draft notification of Bharat Stage (BS) VI emission standards in 2016 for all major on-road vehicle categorie...

author_logo-ibef1.jpg Television Industry in India
IBEF, Knowledge Centre

Television was first introduced in India on September 15, 1959 with the help of UNESCO. Since then the television industry has witnessed transformation with advancement i...

author_logo-ibef1.jpg Indian Tourism Industry: An Insight
IBEF, Knowledge Centre

During the celebration of 73rd Independence Day, Prime Minister Mr Narendra Modi addressed the nation from the Red Fort and underlined that India ‘has mu...

author_alok_kirloskar1.jpg From smart water pumps to drones: Technology is changing Indian farms!
Alok Kirloskar, Executive Director, Kirloskar Brothers Limited

Disruptive technologies and innovations in application engineering are fast changing farming practices in India. From preparing the land to sowing, to reaping and mentori...

ideas More

Ideas

Zomato: Top Of The Food Chain
Zomato, an Indian start-up is in the business of online food ordering. It initially launched Foodiebay.com in Gurugram in 2008, a website that scanned menus and provided ratings and recommendations on....

JOIN IBEF.org

Join IBEF.org now. Enjoy FREE subscriptions downloads, updates and more.

Error

Already a member?
Login / Retrieve Password