BRINGING BACK OPTIMISM

As we enter another year of hopes and opportunities, how will be the year 2023 for Indian infrastructure and construction sector? What could be the trends to look for in the year ahead? What could be the key challenges and what will drive the growth? Construction Times explores the market trends with views from industry stakeholders.

The year 2022 was a period of total revival from the impacts of Covid as industry activities have almost returned to normal with meetings and industry exhibitions coming back to physical mode. There were challenges also in the form of growing fuel and raw material prices impacting the industry and the Russia-Ukraine war taking a toll on the global economy. At the same time, there were many forward-looking infrastructure creation plans being launched in 2022 which has created opportunities to the industry stakeholders. These opportunities are going to have a positive impact in 2023 and ahead as well. Here's a brief overview of the various infrastructure segments.

Roads & Highways

Road network is the prime mode of transport in India, both in terms of traffic share and contribution to the national economy. Apart from facilitating the movement of goods and passengers, road transport plays a key role in promoting equitable socio-economic development across regions of the country.

The second-largest globally, India has about 63.73 lakh km of road network. This includes 144,634 km of national highways; 186,908 km of state highways; and 59,02,539 km of other roads.

According to provisional figures from the Ministry, MoRTH constructed 5,337 km of National Highways and awarded 6,318 km of National Highways till December 29, 2022. The execution of highways under Bharatmala Pariyojana saw a decline in 2021-22, which has slightly improved in 2022-23. However, the slower execution of projects in the past couple of years has delayed the projects by at least three years. Going ahead, the execution is expected to pick up in 2023-24 and there could be a revival in the speed of highway construction in the next couple of years.

Ports & Logistics

The port infrastructure is an important part of India's logistics network for cargo transportation and exim trade. The development of port infrastructure is so critical for sustaining the country's economic growth. India has a total of 226 ports which comprise 12 Major ports. Post Covid, the port operations are back on track, much fitter and robust. Growth of the Indian economy and geo-political developments across globe is helping India to increase footprints much faster than expected. It helps the ports sector, which remain sound and good for the foreseeable future. With several key initiatives and policies such as PM GatiShakti and National Logistics Policy introduced, the Indian logistics sector would accelerate its journey towards becoming more efficient, productive, and globally competitive.

Airports

India has approximately 464 airports/airstrips, of which 125 airports are owned and controlled by Airports Authority of India (AAI). AAI-managed airports deal with close to 78% of the total domestic passenger traffic and 22% of international passenger traffic. To accelerate the development of airport infrastructure in the country, the government plans to invest US$ 1.83 billion. The Civil Aviation Ministry is also pushing hard to remove inefficiencies in the delivery of services and to improve passenger experience. Plans are afoot to privatize 30-35 airports over the next five years.

To expand airport capacity at existing airports, NABH (NextGen Airports for Bharat) Nirman initiative has been introduced by the Ministry of Civil Aviation. Under this initiative, the government plans to work towards a five-fold expansion in airport capacity to handle a billion trips a year, in the next 10-15 years.

Railways & Metros

The Indian Railways moves 8.1 billion passengers and 1.2 billion ton of freight across the country on an annual basis. Indian railway network is amongst the largest rail networks in the world carrying around 1,418 million tonne of cargo in FY2022. Considering its importance, the government has launched and accelerated rail infrastructure initiatives to revamp the sector. Further, the Indian Railways' National Rail Plan - 2030 is a planned and integrated roadmap to building a future-ready rail system, focusing on capacity augmentation, creating world- class passenger facilities/infrastructure, increasing safety and efficiency, and reducing its carbon footprint.

Indian Railway has made station development as the main focus area to enhance customer satisfaction. Three stations viz. Rani Kamalapati station of West Central Railway, Gandhinagar Capital station of Western Railway and Sir M. Visveswaraya Terminal Station of South Western Railway have been developed and commissioned. Work on 48 railway stations is in progress; 19 railway stations are under different stages of tendering and planning.

In India, 15 cities have an operational Metro network of about 746 km (many of which are undertaking network expansion), while another seven cities of about 640 km have under-implementation Metro projects. This apart, 1,400 km of Metro Rail projects worth Rs. 2 trillion are in the approval/proposal stage of which a 352-km new Metro network has been approved, with the balance being in the proposal stage. The Metro Rail network is likely to witness 2.7 times expansion in the next five years.

Water & Wastewater

The Government of India in partnership with states is implementing Jal Jeevan Mission (JJM) to make provision of tap water supply to every rural household by 2024. As on 21 December 2022, more than 10.76 crore (55.62%) of rural households are being provided with tap water connection in adequate quantity, of prescribed quality on regular basis. Indian water and wastewater industry will continue to thrive as a result of the government's aggressive implementation of the Jal Jeevan Mission and AMRUT 2.0 programme, which will lead to an increase in private investments and participation of new players in the segment.

Renewable Energy

Indian renewable energy sector has made significant progress this year with acquiring major deals and getting good investments from across the globe. In line with Prime Minister's announcement at COP26, the Ministry of New and Renewable Energy is working towards achieving 500 GW of installed electricity capacity from non-fossil sources by 2030. So far, a total of 172.72 GW of capacity from non-fossil fuel sources has been installed in the country as on 31 October 2022. This includes 119.09 GW RE, 46.85 GW large hydro and 6.78 GW nuclear power capacity. This has a share of 42.26% of total installed generation capacity in the country, i.e. 408.71 GW as on 31 October 2022. Capacity additions in solar, wind, storage and hybrid systems are the biggest opportunities for meeting the net zero carbon emissions targets.

Going ahead, the government's emphasis on developing world-class infrastructure in the country promises continued growth in the coming years.

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