Dublin, March 02, 2023 (GLOBE NEWSWIRE) -- The "India Construction Industry Databook Series - Market Size & Forecast by Value and Volume across 40+ Market Segments in Residential, Commercial, Industrial, Institutional, Infrastructure Construction and City Level Construction by Value - Q1 2023 Update" report has been added to ResearchAndMarkets.com's offering.
Construction industry in India is expected to grow by 12.0% to reach INR 45,907 billion in 2023.
Despite near-term challenges in certain construction sectors, medium to long term growth story in India remains intact. The construction industry in India is expected to grow steadily over the next four quarters. The growth momentum is expected to continue over the forecast period, recording a CAGR of 9.9% during 2023-2027. The construction output in the country is expected to reach INR 66,954.8 billion by 2027.
Despite the surge in construction costs, government spending on infrastructure projects has remained strong in 2022, and the trend is projected to further continue in 2023. This along with the spending on commercial projects, including the construction of new data centers across the country, will keep supporting the growth of the construction industry over the next three to four years.
Furthermore, the demand for residential units is also driving the residential construction market in India. Despite the surge in construction costs and rate hikes announced by the Reserve Bank of India, the growing residential sales volume has led to a recovery in the real estate market.
The growth has been led by mid-range, premium, and luxury segments in 2022. However, the trend might slow down in 2023, owing to recessionary fears and a further increase in rate hikes projected to be announced by the Reserve Bank.
Increasing spending by the government on infrastructure projects to support industry growth in India
The government has announced a strong pipeline of infrastructure projects across different sectors. The spending on these projects is projected to keep assisting the growth of the overall construction industry in India over the next three to four years. To fund the infrastructure construction projects, the government has also entered into loan agreements with the Asia Development Bank.
In January 2023, the Finance Ministry announced that the Indian government entered into a loan agreement worth US$1.2 billion for funding infrastructure development in India. The loan agreement is expected to cover the development activities of highways in the Northeastern state of Assam and Tripura, among other projects.
The government plans to use US$300 million for the upgrade of 300 kilometers of state highways and district roads in Assam. Furthermore, US$350 million will be deployed to improve the connectivity of the metro rail system in Chennai. In Maharashtra, the government plans to deploy US$350 million to improve connectivity with key economic areas in the region.
As the national government continues to prioritize the development of infrastructure, the government is projected to enter into more such agreements over the next three to four years. This will keep driving investment in the sector, thereby supporting the growth of the construction industry in India.
Investment in data center construction projects is expected to grow significantly in India
The demand for data centers has surged amid the ongoing digitalization in India and overseas. To support the growing demand, many domestic and foreign firms have announced investments toward the development of new data center facilities across the country.
In January 2023, Digital Edge, the Singapore-based data center firm, announced that it is expanding its footprint in the Indian market. Across India, the firm is planning to launch several hyper-scale data centers, and therefore, has entered into a partnership with National Investment and Infrastructure Fund and AGP DC InvestCo Pte. Ltd. The firm announced that its first project of 300MW hyper-scale facility will be built in Navi Mumbai and the construction activities are slated to commence in 2023.
In December 2022, CapitaLand India Trust Management Pte. Ltd. also announced that the firm had acquired 5 acres of land in Chennai to construct a 55MW data center. The first phase of the data center is expected to go live by the end of 2025. Along with Chennai, the firm is also actively seeking to launch data center projects in Mumbai, Bengaluru, Noida, and Hyderabad.
Big tech giants such as Amazon and Microsoft are also planning to launch data center facilities in India over the next three to four years. The investment from these tech giants in data center facilities will keep supporting the growth of commercial construction projects from the short to medium-term perspective in India.
Further rate hikes by the Reserve Bank of India might affect housing sales in 2023
The Reserve Bank of India announced five rate hikes in 2022 to bring down inflation. The cumulative rate hikes announced by the central bank stand at 225 basis points in the last eight months, leading to December 2022.
While the initial rate hikes have done little to bring down the demand for residential units in India, further increases are projected to have an impact on the sales of housing units in 2023. Notably, the Reserve Bank of India is expected to continue with its rate hikes in H1 2023.
This will have an impact on the monthly installments paid by homebuyers, and thereby consumer affordability is projected to get affected significantly. Consequently, the publisher expects the demand for housing to drop in 2023, amid the consistent increase in rate hikes by the Reserve Bank.
Scope
India Economic Indicators
India Top Cities Construction Data
India Residential Building Construction Coverage: 10-year market size & forecast in value and volume (area and units) terms by
- Housing type (multi family, single family)
- Key cities (Tier - 1, Tier - 2, Tier - 3 segmentation)
- Price point / income level (luxury, mid-tier, affordable)
- Construction stage (new construction, re-development & maintenance)
India Residential Green Building Construction Coverage: 10-year market size & forecast in value and volume (area and units) terms by
- Green building by Housing type (multi family, single family)
- Green building by Key cities (Tier - 1, Tier - 2, Tier - 3 segmentation)
- Green building by Price point / income level (luxury, mid-tier, affordable)
India Commercial Building Construction Coverage: 10-year market size & forecast in value and volume (area and units) terms by
- Office (further broken down by Grade A, Grade B, and Grade C)
- Retail (further broken down by Grade A, Grade B, and Grade C)
- Hospitality (further broken down by Grade A, Grade B, and Grade C)
- Restaurant (further broken down by Grade A, Grade B, and Grade C)
- Entertainment
- Sports facility
- Construction stage (new construction, re-development & maintenance)
India Commercial Green Building Construction Coverage: 10-year market size & forecast in value and volume (area and units) terms by
- Office green building construction
- Retail green building construction
- Hospitality green building construction
- Restaurant green building construction
- Entertainment green building construction
- Sports facility green building construction
- Other commercial green building construction
- India Industrial Green Building Construction Coverage: 10-year market size & forecast in value and volume (area and units)
India Institutional Building Construction Coverage: 10-year market size & forecast in value and volume (area and units) terms by
- Healthcare construction
- Educational construction
- Public sector
- Construction stage (new construction, re-development & maintenance)
India Institutional Green Building Construction Coverage: 10-year market size & forecast in value and volume (area and units) terms by
- Healthcare green building construction
- Educational green building construction
India Infrastructure Construction Sectors: 10- year market size & forecast in value terms by
- Marine and inland water infrastructure
- Utility system construction (oil and gas infrastructure, communication infrastructure, power infrastructure, water and sewer infrastructure)
- Transportation infrastructure (highway, street and bridge construction, railway construction, airport construction, and tunnel construction)
- Construction stage (new construction, re-development & maintenance)
India Green Infrastructure Construction: 10- year market size & forecast in value terms
For more information about this report visit https://www.researchandmarkets.com/r/9wrlkt
About ResearchAndMarkets.com
ResearchAndMarkets.com is the world's leading source for international market research reports and market data. We provide you with the latest data on international and regional markets, key industries, the top companies, new products and the latest trends.
