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Second largest road
network
• India has the second largest road network in the world, spanning a total of 4.7 million
kilometres. This is used to transport over 60 per cent of all goods in the country and 85 per
cent of total passenger traffic
Rising investments in
road sector • The Planning Commission of India aims to spend nearly 20 per cent of the total
investment of USD1 trillion during the 12th Five Year Plan (2012–17) to develop roads
Growing private sector
involvement • The private sector is emerging as a key player in the development of road infrastructure in
India
Rapid growth in national
highways • National highways are expected to reach 85,000 kilometres by the end of the 12th Five
Year Plan from 79,116 kilometres in FY 2013
Source: MoRTH Annual Report 2012-13,
Planning Commission, Aranca Research
Growing demand
Source: NHAI, MoRTH, Planning Commission, Business Monitor International, Aranca Research
Notes: NHAI - National Highways Authority of India, MoRTH - Ministry of Road Transport and Highways, E - Estimate
Robust demand
• Greater connectivity between different cities, towns and villages has led to increased road traffic over the years
• Growth in automobiles and freight movement commands a better road network in India
Attractive opportunities
• Roads and bridge infrastructure industry to be worth USD19.2 billion by FY17
• During FY14, around 8,270 km of the National Highways are to be improved along with construction/rehabilitation of 100 bridges and 4 bypasses
Policy support
• Road infrastructure is a key government priority; the sector has received strong budgetary support over the years
• Financial institutions have received government approval to raise money through tax-free bonds
Increasing investments
• USD1 trillion worth of expenditure on infrastructure is estimated over FY13–17
• Government of India aims to develop a total of 66,117 kilometres of roads
• Growing participation of private sector through Public-Private Partnership (PPP)
2009
Roads &
bridges
infrastructure
value:
USD6.9
billion
FY17E
Roads &
bridges
infrastructure
value:
USD19.2
billion
Advantage
India
Source: Ministry of Road, Transport and Highways
(MoRTH) – Annual Report 2012-13, Aranca Research
Roads
(Total length: 4.7 million Kms)
State Highways National Highways District and Rural Roads
Total Length: 155,716
kilometres
Share: 3.3 per cent of
the total roads in India
Total Length: 79,116
kilometres
Share: 1.7 per cent of
the total roads in India
Total Length: 44,55,010
kilometres
Share: 95.0 per cent of
the total roads in India
India has the second largest road network in the world (4.7 million kilometres)
Roads bear about 85 per cent of the country’s passenger traffic and 60 per cent of freight traffic
Length of national
highways (kilometres)
Passenger vehicle sales
(Million)
NHDP toll collection
(USD million)
Highway projects
awarded (kilometres) by
NHAI
Share of infrastructure in
total bank funding (%) 2.3
677
64.5
0.71
58,112
14.7
1,116
743.3*
2.7
79,116
FY03
FY13
Source: National Highway Authority of India (NHAI), National Highway Builders Foundation, ICRA Ltd, Reserve Bank of India (RBI)
Notes: FY - Indian Financial Year (April-March), NHDP - National Highway Development Project, Aranca Research; * - Data is target figure for toll
collection in 2012-2013
Roads/bridges infrastructure value in India
(USD billion)
The value of total roads and bridges infrastructure in India is
expected to grow at a CAGR of 17.4 per cent over FY12-17
to reach USD19 billion
Currently, the Government of India aims to develop a total
of 66,117 kilometres of roads under various programmes
such as NHDP, SARDP-NE and LWE
Of the total roads, 20,945 kilometres have been developed,
while a major share of the remaining is estimated to be
completed by the end of the 12th Five Year Plan
Source: Business Monitor International (BMI), Aranca Research
Notes: CAGR - Compounded Annual Growth Rate,
FY - Indian Financial Year (April - March), F - Stands for forecast,
NHDP - National Highway Development Project,
SARDP-NE: Special Accelerated Road Development Programme for
the North Eastern Region and LWE - Left Wing Extremism
Programme
6.9 6.8 8.3 8.6 8.6
11.0
13.4
16.1
19.2
FY09 FY10 FY11 FY12F FY13F FY14F FY15F FY16F FY17F
CAGR: 13.6%
Lane composition of national highways (FY13) National highways account for 1.7 per cent of the total road
network in India
Under the 12th Five Year Plan (FY13–17), the government
plans to develop 20 kilometres of national highways per
day, which implies a total development of 7,300 kilometres
per year
Double-lane highways constitute the largest share of
highways in India (40,658 kilometres)
Double-lane highways are followed by single/intermediate-
lane (19,330 kilometres) and four/six/eight-lane (19,128
kilometres) highways
National highways are expected to reach 85,000 kilometres
by the end of the 12th Five Year Plan from 79,116 kilometers
in FY13 Source: MoRTH, Aranca Research
24.4%
51.4%
24.2%
Single lane
Double lane
Four/ Six/ Eight Lane
The National Highway Authority of India (NHAI) is a government agency responsible for construction, maintenance and
development of highways
The Government of India has formulated a seven-phase programme known as ‘National Highway Development Project
(NHDP)’, vested with NHAI, for the development of national highways in the country
Porbandar
Mumbai
Kanyakumari
Chennai
Kolkata
Silchar
Delhi
Srinagar
North South –
East West
Corridor
Golden Quadrilateral
NHAI
Golden Quadrilateral (GQ): It is the highway network that connects four major
metropolises
North South & East West Corridor (NS – EW NHDP Phase I and II): It connects the
country’s extreme ends
NHDP Phase III to VII: Construction and improvement of roads in the remaining
urban and suburban regions
Source: NHAI, Aranca Research
NHDP phase Project description Total length
(Kms) Cost Development model
Phase I
Development of Golden Quadrilateral, North
South & East West (NS-EW) corridor, port
connectivity and other national highway 7,522 USD7.0 billion
EPC (Engineering-
Procurement and
Construction)
Phase II Development of North South & East West
(NS-EW) corridor and other national highway 6,647 USD7.2 billion EPC
Phase III Development of four lane national highways 12,109 USD18.5 billion PPP (Build-Operate-
Transfer)
Phase IV Upgradation of single lane to two-lane 20,000 - PPP
Source: NHAI, Aranca Research
Note: PPP - Public Private Partnership
NHDP phase Project description Total length
(Kms) Cost Development model
Phase V Upgradation of four-lane highways to
six-lane and port connectivity 6,500 USD9.3 billion PPP
Phase VI Development of expressway 1,000 USD3.8 billion PPP-(Design-Build-
Finance-Operate)
Phase VII Development of ring roads, bypasses and
flyovers 700 USD4.2 billion
PPP (Build-Operate-
Transfer)
Source: NHAI, Aranca Research
Note: PPP - Public Private Partnership
The Special Accelerated Road Development Programme for the North Eastern region (SARDP-NE) is aimed at developing
road connectivity between remote areas in the North Eastern region with state capitals and district headquarters
SARDP-NE is vested with the development of double-/four-lane national highways of about 4,798 kilometres and double-
laning/improving about 5,343 kilometres of state roads
Implementation of the road development programme will facilitate connectivity of 88 district headquarters in North Eastern
states to the nearest national highways
The project will be undertaken in three phases:
Phase Project description Total length
(Kms) Date of completion
A Improvement of national highways 2,041
March 2015 Improvement of state roads 2,058
B
Development of double-lane of national highways 1,285
Not Disclosed
Double-laning and improvement of state roads 2,438
Arunachal Pradesh package
of roads and highways Development of roads 2,319 March 2017
Source: NHAI, MoRTH, PPPinIndia, Aranca Research
Total length (Kms) Total cost (USD billion)
Approved 5,477 USD1.6
Awarded 5,049 USD1.5
Completed (By December 2012) 1,960 USD0.5
The government has approved a Road Requirement Plan (RRP) for the development of 1,126 kilometres of national highways
and 4,351 kilometres of state roads in Left Wing Extremism (LWE) affected districts
The project has been implemented in the states of Andhra Pradesh, Bihar, Chhattisgarh, Jharkhand, Madhya Pradesh,
Maharashtra, Odisha and Uttar Pradesh for a total value of USD1.6 billion
The project will be vested with the Ministry of Road Transport and Highways (MoRTH) and is scheduled to be completed by
FY15
Source: NHAI, MoRTH, PPPinIndia, Aranca Research
As on 31 March 2012, India had 2,409 PPP projects across the infrastructure sector, of which 874 are dedicated towards
roads and highways
The BOT model’s share in total highway projects has increased sharply over the years; it rose to 31 per cent in FY10 from
10 per cent in FY05
Total PPP projects in India (March 2012) Composition of total highway projects awarded
8% 13% 15% 19% 22% 23%
9% 12% 12% 20% 20%
27%
4% 7% 9% 9% 17%
53%
FY05 FY06 FY07 FY08 FY09 FY10
BOT SPV Public Funded
Source: MoRTH, Aranca Research
36.3%
63.7%
Roads/NationalHighways
Others
369
464 470 877
2,677
6,144 6,067
1,116
0
1000
2000
3000
4000
5000
6000
7000
FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13*
Awards won by BOT private players Road construction projects awarded to BOT companies
recorded a CAGR of 17.1 per cent over FY06-13.
The total projects awarded in FY13 by both NHAI and
Ministry of Road Transport & Highways is 1,933 km
CAGR: 17.1%
Source: NHAI, Crisil, Aranca Research
Note: FY13* - Projects awarded by NHAI
Source: Aranca Research
Note: NH – National Highway
Until 2005, the road construction market was dominated by public sector companies
However, the emergence of private players over the last decade has made the road construction market fragmented and
competitive; the players bidding for projects also vary by size
Major private sector players
Major projects: Mumbai–Pune BOT Project, Pune–Nashik BOT
Project, Bharuch–Surat BOT Project, Thane–Bhiwandi by-pass
Four-Lane Project, Thane Ghodbunder BOT Project
Major projects: North Karnataka Expressway, West Gujarat
Expressway, Noida Toll Bridge, Ahmedabad - Mehsana Toll Road,
East Coast Road, Kotakatta Kurnool Road Project
Major projects: NH6 Dhankuni to Kharagpur, Sambalpur Baragarh,
NH4 Belgaum Dharwad, NH-3 Pimpalgaon – Nashik – Gonde road
(JV with L&T), Jaora – Nayagaon Road
Major projects: Bandra–Worli Sea Link, Badarpur Elevated
Highway Project, Delhi Faridabad Elevated Expressway,
Breakwater construction for new port at Ennore, Chennai
Major projects: Tuni–Ankapalli Highway, Tambaram–Tindivanam
Highway, Ambala–Chandigarh Highway
Source: NHAI, MoRTH, Aranca Research
Note: FDI - Foreign Direct Investment
Increasing private
sector participation
• Government policy to increase private sector participation has proved to be a boon to the
infrastructure industry with a large number of private players entering the business through
the Public Private Partnership (PPP) model
• The type of PPP models used in road projects are Build Operate Transfer (BOT ) toll and
BOT annuity
Partnerships between
Indian and foreign firms
• With the Government of India permitting 100 per cent FDI in the road sector, most foreign
companies have formed partnerships with Indian players to participate in the sector’s
growth story
India’s renewed focus
on infrastructure
• Infrastructure is the key to supporting double-digit GDP growth in India during the medium-
to long-term
• The government has hence made infrastructure development a key policy issue and plans
to spend USD1.0 trillion during FY13-17 on the sector
Success of India’s Five
Year plans
• Through Five-Year Plans, India has increased the length of national highways from 21,378
kilometres during the late 1940s to 71,772 kilometres by the end of the 11th Five-Year Plan
(FY08-12)
• The total length of national highways is expected to touch 85,000 kilometres by the end of
12th Five Year Plan
Source: Aranca Research
Policy support
Greater government focus on
infrastructure
Standardised processes for
bidding and tolling; clear policy framework
Tax sops, FDI, FII encouragement
Rise in two-wheeler and four-wheeler
vehicles
Increasing investments
NHAI implementing one of the largest
road projects
Rising private sector participation
Strong projected demand making returns attractive
Inviting Resulting in
Increasing freight traffic
Strong trade and tourist flows
between states
Growing demand
Higher individual discretionary spending has led to increasing spending on cars, motorbikes and scooters
Growing domestic trade flows have led to rising commercial vehicles and freight movement
Road’s traffic share of the total traffic in India has grown from 13.8 per cent to 65 per cent in freight traffic and from 15.4
per cent to 90 per cent in passenger traffic from 1951 to 2011
Higher road traffic
Rising incomes leading to
increasing number of vehicle owners
Growing movement of goods within the
country due to economic integration
Better quality roads makes road travel cheaper and safer
Increasing roadways leading to greater accessibility between different
cities/towns/villages
Growth in small and medium enterprises
in India
Source: MoRTH, World Bank, Aranca Research
490
384
533
685
810 793
857
0
100
200
300
400
500
600
700
800
900
FY08 FY09 FY10 FY11 FY12 FY13 FY14E
1.5 1.6
2.0
2.5 2.6 2.7
2.8
0.0
0.5
1.0
1.5
2.0
2.5
3.0
FY08 FY09 FY10 FY11 FY12 FY13 FY14E
Trends in passenger vehicle sales (in million)
Total auto sales across categories are estimated to rise 6-8 per cent in FY14 with passenger vehicles growing by 5-7 per
cent and commercial vehicles growing by 7-9 per cent in FY14
Sales of passenger vehicles are expected to increase at a CAGR of 10.7 per cent to 2.8 million during FY08-14
Sales of commercial vehicles are expected to rise at a CAGR of 9.7 per cent to 8,57,000 during FY08-14
Rising per-capita income and growing middle class coupled with easier access to finance and a wider price range of
vehicles have led to boosted car sales
Trends in commercial vehicle sales (in ’000)
Source: SIAM, Aranca Research
Note: E: SIAM Estimates
CAGR: 10.7%
CAGR: 9.7%
Length of National Highway added in the various
Five-Year Plans (kilometres)
Road addition in the 3rd Five Year Plan was only 179
kilometres, this increased to 10,228 kilometres in the 11th
Plan
Source: NHAI, MoRTH, Aranca Research
Note: * - Estimated
The overall physical target for development of National
Highways as included in the 12th Five Year Plan
Scheme Target
Widening to 2-lane (km) 14,800
Widening to 4-lane (km) 9,826
Widening to 6-lane (km) 5,590
Strengthening/Improvement of Riding Quality Programme (IRQP) (km)
8,500
Construction of bridges (in No’s) 50
Construction of bypasses (in No’s) 5
0
1514
179
4819
158
2867
1902 609
23814
9008 10228
36500
0
5000
10000
15000
20000
25000
30000
35000
40000
1st 2nd 3rd 4th 5th 6th 7th 8th 9th 10th 11th 12th*
Share of infrastructure in total bank funding Infrastructure is a priority of the government’s economic
policy; funding for the sector from both private and public
sectors is set to increase sharply in the near term
Infrastructure’s total share in bank funding rose from 2.3 per
cent in 2002 to about 14.6 per cent in 2012
Source: RBI, ICRA Limited, Aranca Research
Note: 2013* - September 2013
2.3% 3.5%
4.2%
6.9%
7.5%
7.3%
8.5% 9.5%
11.5%
14.0%
14.6%
15.0%
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013*
Combined gross fiscal deficit of the centre and
state governments (% of GDP)
The government has been eager to involve private sector
funding for infrastructure projects and thereby reduce
strains on the budget
The PPP model has emerged as the favoured one for
private sector participation in roads projects
Note: PPP - Public Private Partnership
Source: RBI, Aranca Research
Note: E – RBI Estimates (Median Forecast)
9.6% 9.3%
8.3%
7.2% 6.5%
5.1%
4.0%
8.3%
9.3%
6.9%
8.1%
7.2%
7.0%
FY02 FY03 FY04 FY05 FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY 14E
% of BOT share in different phases of NHDP Phase I and Phase II of NHDP were mostly developed by
public funds with the BOT share at 14.8 per cent and 28.6
per cent respectively
Public Private Partnership (PPP) model will be the favoured
way of executing the remaining NHDP phases
14.8%
29.6%
95.9%
83.1%
100.0%
100.0%
100.0%
Phase I
Phase II
Phase III
Phase IV
Phase V
Phase VI
Phase VII
Source: NHAI, MoRTH, Aranca Research
Notes: NHDP - National Highway Development Phase,
BOT - Build Operate Transfer
Source: Aranca Research,
Note: FII - Foreign Institutional Investors
Infrastructure is a key
government priority
• Infrastructure investment is a major focus area for the government
• The Government targeted USD500 billion worth of spending on infrastructure in the 11th
Five-Year Plan (FY08-12); the amount is set to double to USD1 trillion in the 12th Five
Year Plan (FY13-17)
Support from the Union
Budget
• The FII investment limit in infrastructure corporate bonds was raised from USD5 billion to
USD25 billion in the Union Budget
• An increase in road development fund was also announced
• The Indian government plans to establish a Road Regulator Authority in FY14 to address
financial issues, construction risk and contract management in the road sector
Rural development
• The Prime Minister’s Gram Sadak Yojana (PMGSY) is a scheme for development of rural
roads in India
• The Construction of Rural Roads Project (CRRP) is another initiative focused on rural
development
Taxes and other sops
• Companies enjoy 100 per cent tax exemption in road projects for five years and 30 per
cent relief for the next five years
• The companies are also granted a capital of up to 40 per cent of the total project cost to
enhance viability
Issue of tax-free
infrastructure bonds
• Infrastructure finance companies, such as India Infrastructure Finance Corporation
(IIFCL), National Highways Authority of India (NHAI), Housing and Urban Development
Corp (HUDCO), Power Finance Corporation (PFC) and India Railway Finance Corporation
(IRFC), have been allowed to issue tax-free bonds for a total value of USD9.2 billion for
FY14
• Institutions were allowed to raise tax-free bonds of about USD5.5 billion in FY12 and up to
USD4.6 billion in FY13
Encouragement of
Infrastructure Debt
Funds (IDFs)
• The Government of India has set up the India Infrastructure Finance Company (IIFCL) to
provide long-term funding for infrastructure projects
• Interest payments on external commercial borrowings for infrastructure are now subject to
a lower withholding tax of 5 per cent vis-à-vis 20 per cent earlier
• IDF income is exempt from income tax
Central Road Fund
(CRF)
• The Central Road Fund (CRF) assists the state government and union territories in the
development of state roads
• For FY13, USD3.6 billion was allocated for the development of roads
For updated information, please visit www.ibef.org
Source: NHAI, MoRTH, Aranca Research
Note: BOT - Build Operate Transfer
Project Length
(kilometre)
Cost (USD
million) Company
Vadodara-Surat Section 6.74 86.94 HCC Concessions Ltd
Walajapet-Poonamalee 93.00 236.63 ESSEL Infra Projects Ltd
4 Laning of Coimbatore- Mettupalayam 53.93 108.76 Transstroy-OJSC Consortium
4-Laning of Goa/Karnataka Border-Kundapur Section 187.24 304.06 IRB Infrastructure Developers Ltd
Four lanning of Walayar - Vadakkancherry section 54.00 125.30 KNR Constructions
2-Lane with paved shoulder with provision of Capacity
Augmentation of Rajasthan Border-Fatehpur-Salasar Section 154.14 97.39 Galfar Engineering Contracting SAOG
4-Laning of Kashipur-Sitarganj Section 77.20 111.31 Galfar Engineering Contracting SAOG
4-Laning of Rajsamand - Gangapur-Bhilwara 87.25 124.53 Sadbhav Engineering Limited
4-Laning of Rohtak - Hissar Section 98.81 176.24 Sadbhav Engg. Limited
4-Laning of Khed - Sinnar Section 137.95 247.69 IL&FS Transportation Networks Ltd
For updated information, please visit www.ibef.org
Outlay for roads under respective Union Budgets
(USD billion)
Roadways has been a key focus area of budget allocations
over the years
For FY14, the Planning Commission has provided an outlay
of USD6.9 billion for the road sector
The budget outlay for road transport and highways
increased at a robust CAGR of 19.4 per cent between FY09
and FY14
In FY14, the government plans to improve about 8,270
kilometers of the National Highways along with
construction/rehabilitation of 100 bridges and four bypasses
for an estimated cost of USD4.3 billion
2.8
3.5
3.2
5.6 6.4
6.9
FY09 FY10 FY11 FY12 FY13 FY14
Source: Respective Union Budgets, Aranca Research
Note: CAGR - Cumulative Annual Growth Rate
CAGR: 19.8%
96
176 201
256 259
134
0
50
100
150
200
250
300
FY09 FY10 FY11 FY12 FY13 FY14*
Toll revenue: IRB Infrastructure Limited
(USD million)
IRB Infrastructure is one of India’s leading BOT operators
with a built-length of around 7,479 lane kilometres
Aggregate size of company’s BOT portfolio is USD3.5 billion
as on March 2013.
The company has 18 BOT projects currently, of which 15
are operational
As on 30 September 2013, IRB Infrastructure’s order book
stood at USD1.2 billion
Source: Company Annual Report & Corporate Presentation, Aranca Research
Notes: CAGR - Compounded Annual Growth Rate,
BOT - Build Operate Transfer
* - H1 FY14
CAGR: 28.2%
Won three road
projects worth
USD411 million
Won first ultra-mega
NHAI road project
worth USD750 million
Received financial
closure for
Ahmedabad Vadodara
Project
2010
2011
2012
2013
Signed contract with
NHAI for four-laning
of NH-17 from Goa/
Karnataka to
Kundapur
Acquired MVR
Infrastructure and
Tollways Pvt Ltd
Source: Company Annual Report, Aranca Research
255
502
843
1,168 1,222
0
200
400
600
800
1,000
1,200
1,400
FY09 FY10 FY11 FY12 FY13
Revenue trends: IL&FS Transportation
Networks Limited (USD million)
ITNL has the largest BOT road asset portfolio (in terms of
lane kilometres) in India, with presence in 17 states in India
The company has 13,161 lane kilometres under its road
asset portfolio; this comprises 26 BOT road projects
ITNL has 24 PPP projects currently, of which 11 are
complete and 13 under construction
Source: Company Website, Company Annual Report, Aranca Research
Notes: CAGR - Compounded Annual Growth Rate,
BOT - Build Operate Transfer
CAGR: 47.9%
Was awarded
order for 1,086 lane
kilometres for a
total value of
USD1.5 billion
Was awarded order
for 1,129 lane
kilometres for a total
value of USD1.5
billion
Four-laning of Beawer-
Gomti Road Project
2010
2011
2012
2013
Won USD312 million
contract for six-laning
Barwa-Adda-
Panagarh sector of
National Highway 2
Source: Company Annual Report, Aranca Research
16.6 17.2
17.9
18.9
19.9 19.8
14
15
16
17
18
19
20
21
FY08 FY09 FY10 FY11 FY12 FY13
Revenue trends: Noida Toll Bridge
(USD million)
Infrastructure Leasing and Financial Services Ltd (IL&FS)
promoted National Toll Bridge Company Limited (NTBCL)
as a special purpose vehicle (SPV) for the development of
the 22-km Delhi-Noida Direct (DND) flyway on a Build Own
Operate Transfer (BOOT) basis
Incorporated in Uttar Pradesh, India in 1996, NTBCL is a
publicly listed company and operates only in India
Source: Company Annual Report, Aranca Research
Salient features:
• Eight-lane dual carriageway connecting Noida and
Delhi
• One major and three minor bridges over Yamuna
river
• Eight-lane approach road on embankment
• 31-lane, 200m-wide, fully computerised toll plaza
• Extensive tree planting and landscaping
• Noise barriers and river training works
CAGR: 3.6%
Projects to be awarded (in kilometres)
National Highway Authority of India (NHAI) aims to award 2,500 kilometres of projects in FY14 vis-à-vis 1,116 kilometres
during the last fiscal
As on September 2013, around 12,310 kilometres of NHDP projects are in the pipeline, with the highest share for NHDP III
(4,732 kilometres)
Projects to be awarded (in kilometres) by NHDP phases
(as on September 2013)
Source: NHAI, MoRTH, Aranca Research
Notes: NHDP stands for National Highways Development Project, E - Estimate
372
1,685
10,316
2,420
659
NS - EW Ph. I& II
NHDP III NHDP IV NHDP V NHDP VII
6,491
1,116
2,500
3,899
FY12 FY13 FY14E FY15E
PPP opportunity over the next five years Development of national highways through Public-Private
Partnership (PPP) is expected to remain the key focus area
for the government
During the next five years, investments through PPP are
expected to be over USD41 billion for national highways
and around USD10 billion for state highways
Source: NHAI, MoRTH, Aranca Research
USD 41.2 billion
USD 9.9 billion
National Highways State Highways
Projected growth of vehicles In India, roads remain the most important means of
transport; it accounts for around 85 per cent of passenger
traffic and 60 per cent of freight traffic
Passenger cars are expected to grow at a CAGR of 15 per
cent to 677 million in FY15 and LCV to grow at a CAGR of
21 per cent over FY10-15 to 3 million in FY15
Source: SIAM Report, Aranca Research
Notes: PC - Passenger Cars, LCV - Light Commercial Vehicles,
SIAM - Society of Indian Automobile Manufacturers
0
150
300
450
600
750
1
1.5
2
2.5
3
3.5
FY10 FY11E FY12E FY13E FY14E FY15E
LCV units in 000s (right axis) PC units millions (left axis)
Summary of foreign contract awards Foreign contractors were awarded projects worth about
USD1.69 billion during 1999-2011; Malaysian and Russian*
contractors have topped the foreign contractors list
About 55 per cent of all such contracts were funded via
BOT, BOT-Annuity and BOT-SPV routes
A joint venture between SVBTG Consortium (USA) and
Stradcom Corp (Philippines) had won the largest contract
during that period (project cost of USD134 million)
Source: NHAI, MoRTH, Aranca Research
Notes: BOT - Build Operate Transfer,
* - Russian joint venture with Indian firm
688
339
199
137 134 101
48 41
568
429
105 149
6
107 45 51
Ma
laysia
n
Russia
*
Chin
a
Russia
n
US
A
Ta
iwan
S.
Kore
an
Indo
nesia
n
Project Cost (USD mn) Length (kms)
Source: NHAI, MoRTH, Union Budget, Aranca Research
Notes: FDI - Foreign Direct Investment, FII - Foreign Institutional Investor; EPC - Engineering, Procurement and Construction;
ECB - External Commercial Borrowings; WHT - Withholding Tax; DDT - Dividend Distribution Tax
Significant potential for
construction & EPC
companies
• About two-thirds of NHDP road
projects (ex-phase IV) are yet
to be awarded, thereby offering
a huge opportunity for private
players over the next five
years.
• For the 12th Five Year Plan, the
government targets to develop
National Highways at the rate
of 20 km per day
• India’s construction sector is
expected to grow at about 35
per cent over FY09-13
Strong focus on infrastructure
• Infrastructure spending is
expected to touch USD1 trillion
in the next Five-Year Plan
(FY13-17)
• Union Budget FY14 allows
financial institutions to raise
USD9.2 billion from tax-free
bonds
• The budget also proposed key
steps such as relaxing ECB
guidelines, removal of
cascading effect of DDT and
reductions in WHT
Major government initiatives
to boost private and foreign
investment
• Increased FII limit in
infrastructure corporate bonds
from USD5 billion to USD25
billion in FY12 is a step in the
right direction
• Cumulative FDI inflow for
FY2000–13 (August) in
construction development and
infrastructure sector (including
roads and highways) stood at
USD24.95 billion
Ministry of Roads Transport and Highways Transport Bhavan
1, Parliament Street
New Delhi –110001
Phone: 91-11-23719097, 23719955
E-mail: [email protected]
National Highway Authority of India G 5 and 6, Sector 10, Dwarka
New Delhi – 110 075
Phone: 91-11-25074100, 25074200
Fax: 91-11-25093507, 25093514
Indian Roads Congress Sector 6, (Near RBI Quarters), RK Puram, New Delhi – 110022
Phone: 91-11-26185303
Secretariat: 91-11-26716778, 26183669, 26185273, 26185315,
26185319
Fax: 91-11-26183669
E-mail: [email protected]
BOT: Build Operate Transfer
CAGR: Compound Annual Growth Rate
EPC: Engineering, Procurement and Construction
FDI: Foreign Direct Investment
FY: Indian Financial year (April to March) – So FY10 implies April 2009 to March 2010
GOI: Government of India
INR: Indian Rupee
LCV: Light Commercial Vehicles
MoRTH: Ministry of Roads Transport and Highways
NH: National Highway
NHAI: National Highway Authority of India
NHDP: National Highway Development Project
USD: US Dollar – Conversion rate used: USD1= INR54.43
Year INR equivalent of one USD
2004-05 44.95
2005-06 44.28
2006-07 45.28
2007-08 40.24
2008-09 45.91
2009-10 47.41
2010-11 45.57
2011-12 47.94
2012-13 54.31
2013-14 59.23
Exchange rates (Fiscal year)
Year INR equivalent of one USD
2005 45.55
2006 44.34
2007 39.45
2008 49.21
2009 46.76
2010 45.32
2011 45.64
2012 54.69
2013 54.45
Exchange rates (Calendar year)
Average of the year
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