Reort On Highways Industry
Investment opportunity on the horizon but some speed breakers remain…
Road transport plays a pivotal role in the economic development of the country, as most of the trade is carried through the road network in India. During the period of FY51-11, the share of passenger traffic carried by roads increased from 15% in FY51 to 85% in FY11 while during the same period the share of freight traffic carried by roads increased from 14% to 60%. After independence, the road network in India has grown manifold with the rapid growth in the both freight and passenger traffic.
The road network in India comprises of National Highways (NHs), State Highways, District roads, Expressways and Rural roads. NHs and state highways together constitute about 5% of the road network in the country while 95% comprises rural and district roads. NHs serve as the arterial network across the country and carry about 40% of the total road traffic. The country has added more than 51,000 km of NHs in the last 60 years. However, it constitutes only 2% of the total road network in the country. http://www.bharatbook.com/market-research-reports/transportation-market-research-report/roads-highways-industry.html
The length of NHs grew at a slower pace till IXth Five Year Plan. The country has added just about 12,100 km of NHs during the period 1951 to 1997 (First to Eight Five Year Plan period). However, there was a quantum jump in NHs addition at about 23,814 km in the IXth Five Year Plan. This was mainly due to the upgradation of the state highways to NHs during this period. At the end of FY11, the country had total NHs network of about 70,934 km. Out of the total network of NHs, 28,740 km length of NHs are entrusted to NHAI, 38,629 km to State Public Work Departments (PWDs) and 3,565 km to Border Roads Organisation (BRO). Highways Industry
Currently, India has an extensive road network of about 4.2 million km. Despite being the second largest in the world, the Indian road network is rather inadequate as the growth was not commensurate with the growth in the number of vehicles in the country. The number of vehicles in the country grew at a CAGR of 10% in the last five years as compared to a CAGR of 4% registered in the road length addition. Thus, inorder to attain the inclusive growth, Government of India (GoI) has laid huge emphasis on development of road infrastructure in the country through initiating various programs like National Highway Development Project (NHDP), Pradhan Mantri Gram Sadak Yojna (PMGSY), Special Accelerated Road Development programme for the North-Eastern Region (SARDP-NE) etc.
Road sector witnessed investment to the tune of about Rs. 1,271 bn during the Tenth Five year Plan.The expected investment in the Eleventh Five Year Plan is more than two times the investment achieved in the road sector during the Tenth Five Year Plan. CARE Research expects that in the Twelfth Five Year Plan the investment in the road sector will be more than Rs.6,000 bn, almost 2.2 times over that in the Eleventh Five Year Plan. Apart from NHDP, the state projects are likely to drive the investments in the road sector as the focus of the state government on strengthening road infrastructure has gathered momentum with the robust economic activity. However, the journey is not expected to be smooth as the execution concerns are likely to persist on account of perennial problem of land acquisition.
SECTION - I CARE Research’s OUTLOOK
New investment horizon in the Twelfth Five Year Plan
National Highways - opportunity from NHDP& non NHDP projects
State road projects - Investment opportunity of about Rs.3,690 bn in the Twelfth Plan…
Competitive scenario to ease in the next fiscal …
Not a smooth road all along, some speed breakers remain …
SECTION - II INDUSTRY SECTION
Snapshot of Statewise Road Mix
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