Investment in renewables to go up in FY25 and FY26: CRISIL

Investments in India’s core infrastructure sectors, renewable energy, roads, and real estate, are expected to surge by 38% in FY25 and FY26, reaching US$ 179.86 billion (Rs. 15 lakh crore), as projected by CRISIL Ratings. This growth is driven by supportive policy measures and improved credit profiles across these industries.

Senior director and chief rating officer at CRISIL Ratings, Mr. Krishnan Sitaraman, emphasized the country’s focus on sustainable infrastructure, including expanding green energy capacity and enhancing road networks. The renewables sector is set to capitalize on a strong pipeline generated from record auctions totalling 35 GW in FY24, with plans to add 50 GW over the next two fiscal years. Meanwhile, the roads sector anticipates significant growth, with an expected 11% rise in highway construction to 12,500 km annually.

In real estate, commercial office space demand is projected to grow by 8-10%, while the residential segment remains robust with expected growth of 8-12%. CRISIL Ratings highlighted the role of infrastructure investment trusts (InvITs) and real estate investment trusts (REITs) in attracting over US$ 23.98 billion (Rs. 2 lakh crore) in equity capital over the past two fiscal years, reinforcing the financial strength of private sector players. However, potential delays in commissioning renewables capacity, budgetary constraints in road development, and challenges in managing real estate inventory levels warrant careful monitoring to sustain growth momentum.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.