Investments In India's Infrastructure Sectors To Surge 38% To Rs 15 Lakh Crore By FY26, Says Crisil
The growth is driven by the country's push for sustainable infrastructure, improved physical connectivity, and rising demand for residential and commercial properties.
Investments in India's infrastructure sectors—renewable energy, roads, and real estate—are projected to rise by 38% to Rs 15 lakh crore by fiscal 2026, according to Crisil. The growth is driven by the country's push for sustainable infrastructure, improved physical connectivity, and rising demand for residential and commercial properties.
"The underlying demand in these sectors remains strong, supported by regular policy interventions," said Krishnan Sitaraman, senior director and chief ratings officer at Crisil Ratings.
In renewable energy, the government aims to achieve 450 gigawatt of installed solar and wind capacity by 2030. Auctions in fiscal 2024 totalled 35 GW, the highest in a single year, with a pipeline of 75 GW and plans to implement 50 GW over the next two fiscal years.
The roads sector is expected to see 11% growth in highway construction, or 12,500 km annually over the next two fiscal years, driven by robust awarding and strong order books.
Private sector confidence in roads has been boosted by models like the hybrid annuity model (HAM) and improved concession agreements, which share risks more equitably between developers and concessionaires.
In real estate, commercial office space demand is set to grow by 8-10% in the current and upcoming fiscal years, while residential real estate demand will sustain at 8-12%, according to Crisil.
Recent amendments allowing demarcation of SEZ areas into non-SEZ areas are expected to spur growth in commercial real estate by attracting a wider base of tenants.
The Real Estate (Regulation and Development) Act, 2016, has improved transparency and facilitated timely project completion, enhancing stakeholder confidence in the residential real estate sector.
Crisil's report also identifies risks. In renewables, around 7 GW of storage-linked capacities are yet to secure buyers out of nearly 9 GW commissioned. Risks in roads include moderation in government budget allocations and lender willingness to fund the build-operate-transfer toll model. Discipline in new launches and managing inventory levels remain crucial for real estate stability going forward.
