Project Report on SWOT Analysis of
Infrastructure Industry in India
SWOT
of Infrastructure Industry in India
Analysis
Strengths
of India’s Infrastructure Industry
■ Proliferating domestic and offshore
infrastructure funds target the Indian infrastructure market, driven by strong
demand from the transport, power, urban infrastructure and irrigation segments.
■ India's government is keen to facilitate
private sector participation in infrastructure.
■ Application of takeout financing boosted
in India, potentially unlocking around INR300bn (US$6.2bn) in bank debts, which
could be used to finance infrastructure developments in India.
Weaknesses
of India’s Infrastructure Industry
■ Lack of a structured regulatory and
policy framework, or well-defined operating and financing regulations -
public-private partnership (PPP) framework and regulations are inconsistent and
lack transparency.
■ The country is overly bureaucratic,
thereby delaying the absorption of funds and deterring investors.
■ There are low levels of domestic
expertise, stemming from a shortage of skilled project managers and engineers.
■ There is low mechanisation and limited
use of modern technological equipment.
■ Downgrades to investment targets under
the 11th Five-Year Plan, especially in transport infrastructure, which has been
revised down by 20% in value terms.
■ Limited long-term borrowing capability
on the domestic banking sector due to an immature bond market.
Opportunities
of India’s Infrastructure Industry
■ Opportunities for greenfield projects
across all infrastructure sub-sectors.
■ There is the opportunity for the
domestic industry to become more organised, with the creation of more large
firms through organic growth and acquisitions. This would improve overall construction quality.
SWOT
Analysis - Continued
■ Strong population growth and a growing
economy is fuelling demand for infrastructure.
■ The government is looking to attract
private companies to invest in infrastructure through PPPs.
■ 12th Five-Year Investment plan targeting
US$1trn in investment, with 50% to come from the private sector.
■ Significant investment in electricity
generating capacity with ambitious targets, including 470 gigawatts (GW) of
nuclear power by 2050, 20GW of solar power by 2022 and 20GW of wind capacity by
2020.
Threats
■ India may prove unable to cope with its burgeoning population,
which has passed the 1bn mark, posing a major threat to the economy and political
situation.
■ Destructive flooding affects
productivity.
■ Obstacles such as red tape, lack of
transparency and bureaucratic complexities will threaten implementation of the
12th Five-Year Plan.
■ Land clearance issues cause major delays
to infrastructure and construction projects.
An
inadequate system for compensation and environmental approvals is slowing
investments and, in some cases, preventing projects from progressing.
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