Access India

Equity Insights

November 2024

India Infrastructure -
Revolutionising Productivity
Access India
Equity Insights
November 2024

India Infrastructure - Revolutionising Productivity

Developing India's physical infrastructure has been crucial for achieving long-term development goals, as
it underpins economic growth, trade, and regional integration. Investments in this sector have risen signifi-
cantly, from USD 85 billion in FY14 to USD 159 billion in FY24, growing at a robust 10% CAGR (in INR). This
strong investment trajectory is set to drive further expansion, with key sectors such as railways, roads,
energy, and urban infrastructure expected to grow rapidly, reflecting the government's continued focus on
strengthening the nation’s physical infrastructure.

Government’s lead role

Over the past decade, the government

has taken a leading role in driving (INR Trillion)
infrastructure development, significantly
boosting investments. Infrastructure
spending has surged from USD 18 billioni 11.1

in 2014 to USD 134 billionii in 2023, th

row
9x g 10.0
representing an almost 800% rise (in
7.3
INR). This sharp increase underscores
6.0
the government's strong commitment
to bolstering the country’s physical 3.1 3.0 3.5 4.4

infrastructure. As a share of GDP, 1.1 1.2 1.4 1.5

investment in this sector has expanded FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 FY23 FY24 FY25F
from 1% in 2014 to 3.5% (in INR) today, Central Govt Capex (GBS)
reflecting its growing priority in the
national development agenda.

Additionally, the central government's proactive approach to driving infrastructure growth is evident from
the substantial rise in budget allocations for key infrastructure ministries. Over the past decade, budgeted
expenditures for sectors such as roads, railways, and urban development have increased nearly tenfold,
with other sectors also experiencing significant growth in funding.

(USD bn) 32.40

28.90 FY14i FY24ii
th
8x Growth

7x Growth

1.5x Grow

19.16
8x Growth

4x Growth

12.80
12.87 9.16

4.15 4.17 3.13

1.21

Roads Railways Rural Development Urban Development Others

Source: India Budget, CRISIL Research MI&A.

Note: Others include Civil Aviation, Power, Shipping and Department of Atomic Energy.
GBS – Gross Budgetary Support.

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Government schemes and initiatives

2014 2018 2019 2020 2021 2024

Pradhan Bharatmala National National National National
Mantri Awas Pariyojana Infrastructure Monetisation Logistics Policy Electricity
Yojana (PMAY) (India’s Garland of Pipeline (NIP) Pipeline (NMP) & Gati Shakti Plan (NEP)
Roads Project)
The Prime NIP features a live Physical Unified logistics Strategic
Minister’s Housing Phase-1 target dashboard to infrastructure programme to framework aimed
Scheme aims to of constructing monitor assets enable integration at developing and
provide affordable 84,000 km of infrastructure monetization between ministries optimizing India’s
housing to the national highway projects across key blueprint put into and states with a electricity
urban poor with a network at an sectors. Currently, plan with focus on generation,
target of building investment of investments are monetization technology. transmission and
20 mn houses. USD 127 bnii. being tracked potential of distribution over a
across 27 sectors USD 72 bnii Aims to lend more 10-year period.
As of Oct 2024, with total envisaged over speed (Gati) and Focusing on
8.7 mn houses investment coming years. power (Shakti) by reliable, affordable
have already been opportunity of connecting all and sustainable
completed and USD 1.75 tnii as of concerned power.
delivered. Oct 2024. departments on
one platform.

Key sector performance

SECTOR PARAMETER UNITS 2014 2024

National highway length km 91,287 146,145

National highway project awards km 3,620 8,581
ROADS
National highway project construction km 4,377 12,349
Wait time at toll plaza mins/seconds 12.23 mins 47 secs

Track laying kms/day 4 15

RAILWAYS
Electrification % 33% 95%

Number of airports numbers 74 149

AIRPORTS Passenger traffic million 169 376

Air freight 000' tons 2,279 3,363

Number of ports numbers 212 229

PORTS Capacity MT 1,400 2,710
Cargo handled MT 970 1,540

INLAND Number of operational waterways numbers 3 26

WATERWAYS Cargo handled MT 18 133

Conventional installed capacity GW 173 251

POWER
Renewable installed capacity GW 76 191
Source: CRISIL Research MI&A

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Emerging infrastructure sectors

India’s emerging infrastructure sectors are playing a crucial role in the country’s economic advancement.
These sectors are fostering sustainable development, improving logistical efficiency, and enhancing
technological capabilities. Their growth is aligned with the government’s vision of modernizing infrastruc-
ture, reducing carbon footprints, and strengthening digital and physical connectivity. These advancements
are also attracting significant investments, contributing to the overall competitiveness and resilience of the
Indian economy.

DATA CENTERS WAREHOUSING INLAND WATERWAYS

The data centre market in India On the back of healthy India has over 14,500 km of
is expected to expand rapidly, economic growth, demand for navigable waterways, with
with capital expenditure in the warehousing space is expected 111 national waterways
sector projected to reach USD to increase as well, at 20.6% identified for development.
5.35 bnii by fiscal 2025. CAGR between fiscals 2021 Cargo movement on national
Also, data centre capacity is and 2025. Total warehousing waterways has significantly
anticipated to double to space in the top eight cities is risen from 18 million tonnes in
~1,460 MW by fiscal 2025. projected to reach 417 million 2014 to 133 million tonnes in
The country’s low real estate sq ft by fiscal 2025. In fiscal 2024 and expected to reach
prices and ample availability of 2024, 60-65% of the net 200 million tonnes by 2030.
skilled manpower make it a demand was for grade A The government plans to
cost-effective destination for warehouses due to modern invest USD 180 mnii to
setting up data centres. amenities and advanced develop inland waterways
logistics systems. by fiscal 2030.

Source: CRISIL MI&A

Foundations of a developed India

Over the past decade, India has made remarkable progress in strengthening its physical infrastructure,
laying a robust foundation for future economic growth. With the construction of nearly 55,000 kilometers of
National Highways under initiatives like the Bharatmala Pariyojana (India’s garland of road; running across
east to west) and Golden Quadrilateral, India’s road infrastructure has seen unprecedented expansion.
This network connects critical industrial, agricultural, and cultural hubs with major metropolitan centers,
accelerating trade and mobility. A further 50,000 kilometers of highways are set to be built in the coming
years, reflecting continued momentum in this space.

Similarly, Indian Railways, now the fourth largest in the world and third in passenger traffic, has achieved 95%
electrification, positioning it as a global leader in sustainable rail transport. The introduction of dedicated
freight corridors (DFCs) has greatly enhanced the efficiency of cargo transport by connecting key ports and
industrial regions. Future corridors focused on energy, minerals, cement, and high-traffic routes (~44,000
Km) will further reinforce rail’s central role in India’s industrial and logistics ecosystem. Airports and ports
have also seen significant upgrades, with increased capacity and operational efficiency, while the energy
sector is poised for continued growth, with an emphasis on renewable energy integration for a balanced
energy transition.

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These advancements have elevated India’s global standing, as evidenced by its improved Logistics Perfor-
mance Index (LPI) ranking from 54 in 2014 to 38 in 2023. Moreover, the government's focus on reducing
logistics costs from the current 13-14% of GDP to 8% will boost overall economic productivity. Looking ahead,
sustained progress in infrastructure development will be pivotal to realizing the government’s vision of a
"Viksit Bharat" or "Developed India" by 2047. The continued expansion of transportation networks,
enhanced connectivity, and improvements in energy infrastructure will not only foster economic growth but
also enable India to compete more effectively on the global stage.

i Exchange rate USD to INR is 62.33 for fiscal 2014.

ii Exchange rate for USD to INR is 83.47 for fiscal 2024.

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