India is set to become the third largest construction market in the world by 2025 with a size of $1 trillion, thanks to ramped up activity in the roads, buildings, irrigation, urban infrastructure and railways, KPMG said on Wednesday.
“India’s construction market was around $400 billion in 2015. India is the 4th largest construction market in the world now behind the US, China and Japan. It is the fastest growing market now clocking around 7-8% annual growth. By 2025, India is poised to overtake Japan,” said Neeraj Bansal, partner and head (building, construction and real estate), KPMG India.
However, in line with the global trend, as revealed in its Global Construction Survey, prepared based on responses with over 200 senior executives, KPMG said with the growing size and quantum of projects, complexities are driving in and with that the resultant risks. Two-thirds of the survey respondents believe project risks are on the rise.
“The risks are rising, as highlighted in the survey – more than 80% of project owners and contractors in India believe that project risks are increasing rapidly warranting adequate project management strategies to address these evolving, more complex risks,” Bansal said.
He further said select Indian contractors and project owners are now focusing towards adoption of evolved concepts such as centralised project management office coupled with project performance measurement and reporting systems.
“The effectiveness of these concepts can further be enhanced with the usage of advanced technologies such as robotics, data analytics for purposes such as estimating, bidding, performance monitoring etc,” he said.
The survey said despite substantial investment, the construction industry is struggling to reap full benefits of technologies, including advanced data and analytics, mobility, automation and robotics.
It said just 8% of their companies rank as cutting-edge technology visionaries, some 64% of contractors and 73% of project owners rank as industry followers or behind the curve when it comes to technology. Many lack a clear technology strategy, and either adopt it in a piecemeal fashion or not at all.
The survey also highlighted that to get real benefit from new innovations, engineering and construction companies and major project owners need a strong technology vision and should consider how they can better integrate technology into their processes and culture.