ONE on India's Construction Growth

India accounts for 80% of the South Asia* region’s $4.8 trillion GDP, which was expanded 4.6 fold over the past two decades. At the center of this economic expansion is a major construction boom driving logistics activity across the entire region. This expansion offers opportunities for businesses looking to build reliable distribution networks, increase sales, and improve cross-border trade.

*Data is based on India, Pakistan, Bangladesh and Sri Lanka.

Insight 1:

What is Driving India’s Construction Growth?

While the Reserve Bank of India (RBI) maintains baseline inflation and economic stability through monetary policy, the Indian Government is aggressively driving real GDP growth through massive supply-side infrastructure development. To improve integration to the region, the Indian government launched the "PM Gati Shakti" master plan, aiming to connect transport modes through an estimated multi-year investment of 100 trillion rupees (~$1.1 trillion). Under this initiative, public spending on road and rail networks has increased substantially, holding steady at approximately $60 billion annually to build modern transport corridors.

Trend in Government Expenditure on the Road and Railway Sectors

 

Additionally, India’s population - which surpassed 1.4 billion in 2023—is driving major housing initiatives. The government’s "Housing for All" program is on track to deliver millions of homes, including an additional 10 million urban units by 2029.

Housing Construction Progress in Major State under PMAY-G

 

This increased public and private investment creates a reliable, long-term demand for building materials, machinery, and raw components. For global businesses, this provides a massive opportunity in India’s growing industrial and construction sectors.

Insight 2:

Which Emerging Commodities Have the Strongest Import Demand in India?

The scale of current infrastructure and housing projects has opened a growing market for imported building materials, specialized machinery, and home goods.
This demand has steadily increased container import volumes over the past decade. Imports of key housing materials—such as plywood, insulation, stone, and tiles—along with home furniture, have more than doubled.

India’s Import Trend of Construction and Building Related Commodities

 

Import demand is especially strong in the machinery sector. Container imports of construction machinery parts have more than doubled over the last ten years, growing faster than imports of fully assembled machinery like cranes and bulldozers. This trend highlights a market for global manufacturers of hydraulic, electronic, and mechanical parts used in regional assembly plants.

Insight 3:

Where are the Core Industrial Hubs and Corridors Developing?

Driven by global supply chain diversification strategies, global manufacturers are rapidly establishing production hubs in India, triggering a surge in industrial construction. Supported by broad government policies, this influx of high-tech manufacturing - particularly in electronics, semiconductors and pharmaceuticals - is creating massive new demands for robust logistics networks. To make trade more efficient, specialized industrial zones are designed to support manufacturing by giving international businesses direct access to domestic rail and road networks.

Gujarat State in northwestern India is a key example of this industrial growth. Hosting over 200 industrial estates and attracting the highest level of the government’s housing investment, Gujarat is home to the Dholera Special Investment Region (Dholera SIR). Positioned as India’s first "Semicon City," Dholera is the site of a new $10 billion semiconductor facility by leading companies in the semiconductor space. This development is expected to attract additional manufacturing in EV batteries, aerospace, and solar panels, driving sustained demand for construction cargo.

Gujarat's ports also offer excellent maritime connections. In the 2024 Container Port Performance Index (CPPI), Mundra Port ranked 25th and Pipavav Port ranked 32nd out of 403 ports globally, performing on par with major hubs in Southeast Asia. Pipavav Port is connected directly to the Western Dedicated Freight Corridor (WDFC) via its own rail link, allowing double-stack container trains to carry goods directly to major industrial centers.

These integrated networks enhance connectivity between ports and inland industrial hubs, supporting more efficient cargo movement across India’s industrial corridor.

Partner with ONE to Capitalize on India’s Growth

To capitalize on India’s industrial and construction boom, businesses require a strategic partner with global reach, specialized cargo expertise, and reliable transport solutions. As Your Number ONE Shipping Partner, we support the movement of construction materials, heavy machinery and industrial components through our shipping network, complemented by inland and intermodal solutions to help keep your supply chain agile, secure, and connected.

Data Sources

Insights and data presented in this article are based on information from leading global organizations, including S&P Global Market Intelligence, The World Bank, the Japan External Trade Organization (JETRO), and other publicly available sources.