India’s budget boosts construction

By Andy Brown05 February 2021

A road in India – infrastructure investment is being used by the government to boost economic growth

India’s annual budget has given a boost to the country’s construction industry, with overall infrastructure spending set to increase by over 30% and the establishment of a new Development Finance Institution (DFI).

The new institution has a starting capital of approximately US$2.7 billion and will be used to help fund large-scale infrastructure projects.

The Indian government also announced another 19,500km of road and highways construction projects to be awarded by March 2022, aiming to build road connectivity and boost the economy.

With the government focusing on infrastructure to drive the economic growth, the construction industry is expected to rebound by 14.5% in 2021, according to GlobalData.

Apart from the planned federal capital expenditure, the government has also committed to provide US$27 billion to the states and autonomous bodies for capital expenditure in their respective areas. Reflecting how seriously the government wants to give the economy a jumpstart to recover from the Covid-19 crisis, capital expenditure will be at a decade-high of 15.9% of the overall budget.

Another important step is the launch of a national ‘Asset Monetization Pipeline’, which will monetize the assets and boost financing for the infrastructural segment through the sale of toll roads, oil and gas pipelines and power transmission lines.

Dhananjay Sharma, construction analyst at GlobalData, said, “As a result of the planned capital expenditure, the construction industry is expected to help the economy come out from the Covid-19-induced slowdown and lead India onto a new growth trajectory and facilitate the government’s goal of turning India into a US$5 trillion economy.”

Delivered directly to your inbox, World Construction Week Newsletter features the pick of the breaking news stories, product launches, show reports and more from KHL's world-class editorial team.
Longer Reads
Online exclusive: Epiroc R&D experts on alternative power, testing, and more
The R&D team at Epiroc talk about what projects they are working on, the testing process and what’s next for the construction industry 
Versatile compact loaders
International Construction looks at innovation in compact loaders
How is construction becoming more sustainable?
Sustainable practices in construction are on the up, and the industry is adopting new technologies to reduce emissions
Andy Brown Editor, International Construction Tel: +44 (0) 1892 786 224 E-mail:
Simon Kelly Sales Manager Tel: +44 (0) 1892 786 223 E-mail: