India's Infrastructure and Realty Boom: Rs 15 Lakh Crore Investments by 2026
Investments in India's key infrastructure sectors and real estate are expected to surge 38% by 2026, driven by strong demand and policy interventions.
IndiaInfrastructureRealtyInvestmentsCrisil RatingsReal Estate MumbaiJun 18, 2024
The report highlights that investments in the energy sector will focus on adding more green power to the country's energy mix, while road investments will aim to create denser networks. Realty investments will focus on residential and commercial projects. Strong demand drivers in these three sectors, coupled with regular policy interventions, are expected to fuel investor interest.
The government's targets on renewable energy have led to more auctions of projects, creating a strong pipeline for players. In the road sector, the need for improved physical connectivity for broader economic growth will drive investments. In the real estate industry, the net leasing of commercial office space will see demand growth of 8-10% this fiscal and the next, driven by global capability centres eyeing India's large talent pool and competitive rentals.
Policy interventions will play a crucial role in infrastructure and real estate creation. For renewables, higher import duties have helped the domestic ecosystem for module production, while production-linked incentive schemes for battery and solar cells will set a more sustainable growth path. In the road sector, private sector confidence has been boosted through the hybrid annuity model (HAM) and improvement in concession agreements. The regulatory setup in the real estate sector and recent amendments in the Special Economic Zones (SEZ) Act have also helped.
Crisil Ratings' chief rating officer, Krishnan Sitaraman, said that the underlying demand drivers in these three sectors remain strong, with regular policy interventions fuelling investor interest. The agency's deputy chief ratings officer, Manish Gupta, added that cumulatively Rs 2 lakh crore of equity capital has been deployed in these sectors over the past two fiscals driven by strong investor participation.
Information
Crisil Ratings is a leading credit rating agency in India, providing ratings and research across various sectors, including infrastructure and real estate.
Crisil Ratings is a domestic rating agency that provides ratings and research across various sectors, including infrastructure and real estate.
Frequently Asked Questions
How much investments are expected in India's infrastructure and realty sectors by 2026?
Rs 15 lakh crore
What is driving investments in India's infrastructure and realty sectors?
Strong demand drivers and regular policy interventions
What is the focus of investments in the energy sector?
Adding more green power to the country's energy mix
What is driving demand growth in the real estate industry?
Global capability centres eyeing India's large talent pool and competitive rentals, and demand from domestic sectors
How much equity capital has been deployed in these sectors over the past two fiscals?
Rs 2 lakh crore
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