India’s Transportation Infrastructure Needs Billions of Dollars in Construction

India, as one of the world’s fastest-growing economies, is evolving from an undeveloped, agricultural economy into a more complex economy that includes booming sectors in services, manufacturing and construction. Economic growth has been so rapid that transportation of all types is woefully underdeveloped. Major highways, railways, urban transit systems and airports are needed in order to serve the modernizing industrial and services sectors. (At the same time, other infrastructure areas are also underdeveloped, such as education, telecommunications and utilities.) Clogged roads and slow transport of goods are everyday problems. If India is to continue to prosper and grow, these problems must become national priorities, including appropriate funding from government agencies. One of the biggest problems is building enough efficient infrastructure to enable India’s tens of millions of farmers to get their products to market efficiently—today, a discouraging portion of food commodities rot away due to lack of transport.

A widely read report issued by the McKinsey Global Institute estimates that India needs to invest $1.2 trillion in infrastructure such as subways and roadways (along with additional housing) by 2030, in order to accommodate the hordes of people who continue to move from rural areas to the cities seeking employment.

Meanwhile, as the middle class continued to grow, more and more consumers are purchasing automobiles (or motor scooters) for the first time, adding even more pressure to roadways. Concurrently, a larger portion of the population is now in the urban working class, meaning that they need transportation from their homes to offices and factories. On another end of the transportation spectrum, business travel to India has been strong. Leisure tourism has been growing as well, as more foreign travelers are lured to explore India’s vast array of regions and features. Large numbers of visitors from other nations need reliable air transport to and within the nation, as well as faster ground transportation. India’s burgeoning population and urban expansion continues to complicate already stressed infrastructure.

Some progress in transportation has been achieved, most notably the $12 billion Golden Quadrilateral, a multi-lane highway connecting major cities that span nearly 3,000 miles, including Mumbai, Delhi and Chennai. Since 2000, the Indian government has built or improved local roads that connect 110,000 settlements. Airport construction currently has a high priority, including new or expanded airports in Hyderabad, Bangalore and elsewhere, either under planning or under construction, and a recently completed modernization of the airport in New Delhi. Mumbai’s Chhatrapati Shivaji Airport’s new $2.6 billion international Terminal 2 opened in February 2014. A second Mumbai airport project has been proposed to ease congestion.

Meanwhile, massive subway projects are underway. The Mumbai Metro will cover a total of 221 miles when completed, which is expected in late 2026. The first phase of the project opened in 2014. Even more impressive is New Delhi’s recently launched Delhi Metro. Spanning 118 miles and completed within its $6.55 billion budget, the subway is modern in every way, and absolutely vital to the city’s residents.

The train system is a state-owned monopoly with problems in infrastructure, service and efficiency. China invests three times as much in its railways than India, and spending per Chinese citizen is 11 times higher. Prime Minister Narendra Modi hoped to invest heavily in improvements.

Over the long haul, there are tremendous opportunities in India for equipment suppliers and engineering firms able to fulfill India’s transportation needs. For example, international engineering and project management firm Parsons Brinkerhoff, as well as Korean equipment manufacturer Rotem, are involved in a major subway project in New Delhi (which opened in 2010), and several foreign firms have been included in the Golden Quadrilateral highway project.

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