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Roads

Last Updated: January 2010
 

Sector Structure/Market Size

India has the world's second largest road network, aggregating over 3.34 million kilometers (km).

According to the Planning Commission, the road freight industry will be growing at a compound annual growth rate (CAGR) of 9.9 per cent from 2007-08 to 2007-12. A target of 1,231 billion tonne km (BTK) has been put on road freight volumes for 2011-12.

According to Crisil Research estimates, Indian roadways is among the eight infrastructure sectors expected to draw more than US$ 337.49 billion investment in India between 2007-12. The report further forecasts that during the specified period, Indian roadways is likely to grow at an amazing 100 per cent.

According to industry sources, the road sector in the country would require an investment of US$ 80 billion in the next 3-4 years of which US$ 45 billion is anticipated from the private sector.

Growth Potential

The Indian government has launched the ambitious National Highway Development Programme (NHDP) involving a total investment of US$ 54.1 billion up to 2012.

In 2008-09 itself, the NHAI has infused US$ 4 billion in the NHDP.

It has also started the Bharat Nirman Programme that aims to cover every village having a population of over 1,000 or over 500 in hilly and tribal areas, with all-weather roads.

For the roads and bridges sector, the Eleventh Five Year Plan envisages a total investment of approximately US$ 78.5 billion over the five-year period starting from 2007-08.

As part of a larger plan to improve the country's infrastructure, the government has given the nod to 10 road projects which will be built in public-private partnership at an estimated cost of US$ 2.48 billion. The projects are aimed at four-laning of national highways in eight states.

According to the Press Information Bureau, in the third week of December 2009, the government approved four-laning 384 km of highways with an investment of US$ 673.88 million.

Moreover, in January 2010, the government approved road projects worth US$ 1.33 billion in five states for upgrading nearly 562 km of four-lane highways into six lanes, according to the Press Information Bureau.

The World Bank has agreed to provide a US$ 3 billion loan for developing national highways. The World Bank assistance will be utilised for converting 6,372 km of one-lane highways to two-lane, out of the total of 19,702 km of single lane highways in the country.

Private Sector Investments

  • The Anil Dhirubhai Ambani (ADA) Group-promoted Reliance Infrastructure is aiming at a near five-fold increase in its roads portfolio to US$ 4.54 billion by 2012 from the US$ 950.78 million currently.
  • GMR Highways, the road construction division of Bangalore-based infrastructure major GMR Infrastructure Ltd, is looking at an investment of US$ 423.12 million in the next two-three years to develop various road projects in the country.
  • IVRCL Infrastructure & Projects Ltd has received a road project in Madhya Pradesh worth US$ 335.71 million from the National Highways Authority of India.

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Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.
 
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Related Websites
The National Highways Authority of India
Road Traffic Technology
Public Private Partnerships in India
The Mumbai-Pune Expressway Project


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