India market intelligence: a sustained recovery despite growing challenges
Ashish Jain
Country Manager
Asia
While India’s construction market performance remains at pre-pandemic levels, two years of sustained recovery and strong revival during Q4 reflects a positive outlook, and we foresee this momentum continuing.
Our latest India market intelligence report contains insights into the major cost drivers affecting construction and key material prices and provides analysis of price movement over the last 18 months.
Economic overview
India’s economic recovery is continuing, despite the increasing risk of global supply chain spill-overs and rising geopolitical challenges. Strong growth in exports in recent years has made the economy more resilient, and has resulted in India being among the nations who have achieved the highest increase in their World Competitive Index rankings. Foreign investment has been robust since the start of 2021, with this trend likely to continue.
This outlook is bolstered by the Indian Government’s initiatives to improve infrastructure and utilities, develop affordable housing, and invest further in public-private partnerships, education, transport and manufacturing. OECD has forecast India’s economy to expand by 9.4 percent in 2021-2022, before reverting to 8.1 percent in 2022-2023.
With the Indian Government committed to achieving net zero targets and non-fossil energy capacity of 500GW by 2030, and 50 percent of its energy requirements from renewables by 2030. This will require massive capital spending on projects by the private and public sector, and our team are taking a lead in supporting clients to take advantage of these opportunities.
Regional trends
The report details how the Mumbai construction industry is benefitting from an increase in the construction of data centres. Meanwhile, construction in Delhi has maintained stable growth with the execution of large-scale office projects. Towards the end of 2021 this resulted in an additional 1.3m sq/ft of new supply to the capital’s Grade A inventory.
Bangalore has witnessed consistent growth in the completion of corporate space projects, and further growth is anticipated as the Indian Government begins new infrastructure projects.With the relaxing of COVID-19 restrictions, Hyderabad has witnessed an increase in new residential projects along with corporate offices, warehousing and data centres. Recent land auctions by Telangana Government have not only fetched record revenues but also opened many new opportunities.
For all the analysis and insights on the Indian construction market, download the full report by completing this short form.