Whether Indian Construction Industry is contributing towards the sustainable development of India.

1. 0
SUSTAINABLE
DEVELOPMENT
Responsibly of Construction Industry
ABSTRACT
WeatherIndianConstructionIndustryiscontributing
towardsthe sustainable developmentof India.
Aman Kumar
Business Government&Society

2. 1
Construction Industry in India
The Construction industry of India is an important indicator of the development as
it creates investment opportunities across various related sectors. The construction
industry has contributed an estimated Rs 1,064,068 cr to the national GDP in 2016-
17 (a share of around 7.74%) (as per http://statisticstimes.com). The industry is
fragmented, with a handful of major companies involved in the construction
activities across all segments; medium-sized companies specializing in niche
activities; and small and medium contractors who work on the subcontractor basis
and carry out the work in the field. there were slightly over 500 construction
equipment manufacturing companies in all of India. The sector is labor-intensive
and, including indirect jobs, provides employment to more than 35 million people.
Major Segments of construction Industry
There are three major segments in construction industry
Construction is an essential part of any country infrastructure and industrial
development. Construction industry, with its backward and forward linkages with
various other industries like cement, steel bricks etc. catalysis employment
generation in the country. Construction is the second largest economic activity next
·Real Estate
Construction
• Resaidential
• Commercial
·Infrastructure
Building
• Roads
• Railways&
Airports
• Power etc
·Industrial
Construction
• Oil & Gas
Refineries
• Pipelines
• Textile etc

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to agriculture. Broadly construction can be classified into 3 segments “
Infrastructure, Industrial and Real Estate.
The construction activity involved in different segments differs from segment to
segment. Construction of houses and roads involves about 75% and 60% of civil
construction respectively. Building of airports and ports has construction activity in
the range of 40-50%. For industrial projects, construction component ranges
between 15-20%. Within aparticular sectoralso constructioncomponentvaries from
project to project.
Environmental
Construction projects around the world have a significant impact on our
environment, both on a local and a global scale. Every stage of the construction
process has ameasurable environmental impact: the mining processes used to source
materials, the transportation of these materials to the building site from sources
around the world, the constructionprocess itself and the waste removal and disposal
process that follows the completion of the project. With a rapidly developing global
economy, it is crucial that we understand how the constructionprojects we undertake
impact the environment and how we can measure and reduce that impact in the
future. This article discusses the impact of construction projects on the environment
and how contractors and firms can work to reduce that impact
Aside from contributing to climate change on a global scale, individual construction
projects can have a significant impact on local environments and nature. There are
numerous sources of water pollution on building sites, including diesel and other
fossil fuels, paints, solvents, and toxic chemicals. Even minor chemical spills leech
into the ground and may enter waterways where they toxify water and harm aquatic
life. In the developing world, there are often less stringent requirements for the
disposal of toxic construction waste products, resulting in significant local
environmental damage following a building project.
Even greater than the impacts of the construction process itself is the environmental
impact of the actual buildings that are being constructed. It has been estimated that
the daily operation of buildings accounts for 40% of total energy usage worldwide.
Projects like the Dakota Access Pipeline have been criticized for their long-term

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environmental impact on the areas they run through. Critics of this project suspect
that transporting fossil fuels through hundreds of miles of pipeline will lead to oil
spills that can go undetected for long periods and damage or destroywild lands that
were previously undisturbed.
The Future of Environmentally Conscious Construction
Reducing the environmental effects of construction requires a collaborative effort
from many different stakeholders. While legislators work to create regulations
surrounding constructionwaste management and green building construction, many
global construction firms are taking the initiative to create, study, and enforce their
standards for limiting the environmental impacts of construction projects.
One of the main areas of innovation is the usage of green building materials in new
projects. Green materials can besynthetically produced, reducing, oreliminating the
need to engage in destructive and costlymining practices that usea lot offossil fuels.
Green materials may also beeasier to recycle or re-use in other projects in the future,
leading to cost savings for firms and lesser environmental impacts that benefit
everyone. Construction debris disposal is also streamlined by the use of materials
that are quickly and efficiently recycled.
Socio – Economic
Sustainable development
Sustainable development is a process of ensuring a rising per capita quality of life
over time. Improved quality of life reflects increases in per capita real incomes,
better health and education, improved quality of natural and built environments, and
more social stability. Hence, quality of life is a multi-faceted goal for society and is
regarded bythe Indian government as an over-arching objective for industry and the
population in general.
A rising quality of life is ensured by increasing the stockof productive assets in the
economy since it is these assets – the nation’s true wealth – that constitute the
capacity to producegoods and services that people need and want. Theseproductive
assets consist of man-made, human, social and environmental capital. Man-made
capital refers to machinery, buildings and infrastructure. Human capital refers to the
stockofhuman knowledge and skills, and capacities. Social capital refers to the glue
that holds society together, and loss of social capital shows up in crime and family
breakdown, and loss of community. Environmental capital refers to all

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environmental assets – rivers, the atmosphere, forests and wetlands, oceans and the
soil. The productivity of these capital assets - their contribution to social wellbeing
- is enhanced by technological progress. In the light of these definitions, the
contribution of the construction industry to sustainable development can be gauged
by assessingits role in contributing to the capital stocks and to technological change.
This sets the structure of the report, which looks at each asset in turn.
A schema for sustainable development

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Sustainable
development
•Sustainable developmentisa processof ensuringa risingper capita qualityof life overtime.
Quality of life
•Quality of life reflectsincreasesinpercapita real incomes,better healthand education,
improvedquality of natural and built environments,andmore social stability.
Productive
assets
•Risingquality of life isensuredby increasingthe stock of productive assets inthe economy.
Those assetsconsist of man-made,human, social and environmental capital.
Social
wellbeing
•The productivityof these capital assets - their contributionto social wellbeing- isenhanced
by technological progress
Contributing
to capital
stocks
•The contributionof the constructionindustry to sustainable developmentcanbe gaugedby
assessingits role in contributingto capital stocks and to technological change.
Save more than
the level of
depreciation on
itsassets.
•The eonomicaccounting enablessustainabilityofthe industry to be measureddirectlyby
buildingon the idea of a savings rule wherebyno enterprise can be regarded as sustainable if
it failsto save more than the level of depreciationon its assets.

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Political Context
Construction Industry Development Council
The Planning Commission, Government of India, jointly with the Indian
construction industry has set up Construction Industry Development Council
(CIDC) to take up activities for the development of the Indian construction
industry.
The Council, for the first time in the country, provides the impetus and the
organisational infrastructure to raise quality levels across the industry. This helps to
secure wider appreciation of the interests of construction business by the
government, industry and peer groups in society.
Vision of Construction Industry Development Council (CIDC)

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Clarity of purposeand intent forms CIDC's mandate. Since its inception in 1996, the
Council has taken several initiatives for the development of the industry. Few are
given below:
 Advice the Government on policy formulation related to construction
industry.
 Standardization of construction contracts and procedures.
 Training manpower at skilled worker level and construction management
level.
 Grading of construction entities
 Devise mechanisms for workers' welfare.
 Create an environment that ensures equality of opportunity for all Indian
contractors.
 Help evolve policies for financing.
 Help the industry move from the current state of rule-bound, lowest-price-
based contracting to a more quality-conscious, time-bound & technology-
driven one.
 Dispute Resolution in Construction Contracts.
 Establishing construction equipment bank.
 Interaction and networking with international organisations to promote
emerging technologies and best practices.
Administration and Regulations of Construction Industry
Construction Projects are subject to a host of Central and State laws simultaneously.
Administratively and in terms ofregulation, Central & State Governments have their
own roles to play in Construction. Structure and Role of Construction
Administration
• Structure and Role of Construction Administration of Central Government &
• Structure and Role of Construction Administration of Local Government
There is focussed central machinery or structure of administration for the
Construction Industry. As this sector’s activities are involved with every sector of
the economy, at the Central Government level, the issues related to Construction are
taken up by the Planning Commission.

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In fact Construction was given the Identity of an Industry only two years ago.
Housing & Real Estate, constituting around 10.3% of total Construction, is the only
one segment of the Construction Industry which has a Ministry called the “Ministry
of Urban Affairs”.
Equivalent Ministries exist at State level and at Municipal/local levels. Activity at
any site is governed by the State or a combination of State and Central
administration, depending on the location. Administratively the following
Ministries/Departments/Organisations have operating influence over Construction
Industry: - 7 - Indian Construction Industry – 2006-07
Central Government Ministries
Ministry of Commerce
Ministry of Finance
Ministry of Urban Affairs and Employment
Ministry of Industries
Ministry of Home Affairs Central Government Departments
Cabinet Committee on Foreign Investment
Secretariat of Industrial Assistance
Foreign Investment Promotion Board
MRTP Commission
Registrar of Companies
Central Excise and Customs Department
State Government
Revenue Department
Urban Development Authorities
Sales Tax
Town and Country Planning
Autonomous Statutory Bodies
Reserve Bank of India
Security and Exchange Board of India
Municipal Committee

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Project Objective
To find the Government of India’s policies for construction industry contributes
towards Sustainable Development of India or not
The conditions for sustainability
The easiest way of thinking aboutsustainability is not to dwell ondefinitions ofwhat
it comprises, but to ask what needs to be done by each generation to ensure a
reasonable chance that succeeding generations will have a rising QOL. However the
QOL is defined, the means of generating it will lie in the possession of various
capital assets and in advancing their productivity through technological change.
Traditional economics focused on machinery and infrastructure (man-made capital)
as the main engine of economic growth. Later, the role of human capital – a trained
and educated labour force – was found to be a vital ingredient of economic success.
At the same time, technological change – an increase in the productivity of capital
assets – was emphasised. The wider notion of QOL has recently brought to the fore
two other capital notions: social capital and natural capital.
Socialcapital refers to interpersonal relationships, most often summarised as ‘trust’
between individuals (Fukuyama, 1995). The greater the degree of trust the lower the
costs to society of entering into contracts, bargains and exchanges, and the greater
the effort that can go into production or the provision of services. Social capital
reduces society’s need to engage in unproductive activities that arise because of the
need to ensure that contracts, whether legalised or customary, are honoured.
Finally, natural capital refers to environmental assets. All environmental assets
generate flows of services to humankind. Thoseservices may take the form of direct
amenities which facilitate recreation oraesthetic appreciation, or they may take more
subtle forms such as the cleansing of water or the air, or as a provider of personal
wellbeing through greater contentment.
The economic approachto sustainability therefore now focuses onall four forms of
capital asset – man-made, human, social and environmental – and on technological
change as a means of raising the productivity of each form of capital, the ability to
generate more QOL per unit of capital asset. The resulting conditions for
sustainability are then fairly easy to derive. Future QOL depends on the assets
available to future generations, and on technological change. So sustainability is
(reasonably) assured if this generation leaves a greater per capita stock of capital

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assets to future generations, and if it encourages technological innovation. This has
come to be known as the ‘constant capital’ rule for sustainable development
(Atkinson et al. 1997).
India the country of vivid cultures, society and geography it is not easy to find out
the Development of Infrastructure and Housing demand But Government of India
estimates it for future in order to maintain sustainable development.
Project Activity
 To find the major policies of GOI in different construction sector.
 To make the sustainable construction industry development framework of
India.
 To find the major problem in sustainable development through construction
industry and what are the possible solutions.
Data Used : Secondary Data like Newspaper, Internet
Project Stakeholders
Infrastructure
• Goverment
• Goverment
agencies
• Private Companies
• Public
Housing
• Goverment
• Private Companies
• Customers

12. 11
Major Key Drivers in Infrastructure sector
• The GoI in the Union Budget 2014-15, has announced a
project to develop ‘100 Smart Cities’
• INR 70.6 Billion has been allocated in the current fiscal year
for the same.
• Infrastructural Development Project like SEZs , Industrial
Corridor , Highway Development are launched by the GoI.
which will Bring large Tenders and Jobs for the Society
100 Smart City
• The GoI is in the process of launching a new urban
development mission. This will help develop 500 cities,
which include cities with a population of more than
100,000 and some cities of religious and tourist
importance.
• These cities will be supported and encouraged to harness
private capital and expertise through Public Private
Partnerships (PPPs), to holster their infrastructure and
services in the next 10 years.
500 AMRUTCities
• Exemption from customs/excise duties for development of
SEZs for authorised operations approved by the BOA.
• Income Tax exemption on income derived from the
business of development of the SEZ in a block of 10 years,
in 15 years under Section 80-IAB of the Income Tax Act.
• Exemption from Central Sales Tax (CST).
• Exemption from Service Tax (Section 7, 26 and the Second
Schedule of the SEZ Act).
SEZ/EMC's/Other
Sectoral Clusters

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Government of India’s policies in Sustainability Framework
Social : Government of India formulates policies like
 Pradhan Mantri Awas Yojana
 Deendayal Antyodaya Yojana (DAY) - National Urban Livelihoods
Mission (NULM)
 The National Housing and Habitat Policy (NUHHP), 2007, with a mandate of
providing “Affordable Housing to All”, envisaged that the States would
prepare a State Urban Housing and Habitat Policy and also a State Urban
Housing & Habitat Action Plan. The policy empowers the States to include
passing of specific Acts by the States to achieve the housing policy objectives
through institutional, legal & regulatory reforms, fiscal concessions, financial
sector reforms and innovations in the area of resource mobilization for
housing and related infrastructure development including promotion of cost
effective building materials and technologies at the State level. The policy will
also include an action plan and a pragmatic road map to achieve the objectives
of the policy. A number of States have prepared their State Housing Policies
and some ofthem have reported to be working on the same. In the recent past,
however, the States of Rajasthan and Odisha have come up with specific
• NationalHighways
•Expressways
•SEZ's , National
IndustrialCorridor
Authority
•Projected 1T
Investment
•12 % Contributionto
GDP
•Envioment Protection
Act 1986
•NotificationRegauding
Construction Sector(9
dec 16)
•National Green
Highways Mission
•Pradhan Mantri Awas
Yojana
•Deendayal Antyodaya
Yojana(DAY) -
National Urban
LivelihoodsMission
(NULM)PrintBack
Social Enviromental
Infrastructual
(Man made)
Economic

14. 13
housing policy aimed at affordable housing. The States of Uttar Pradesh and
Haryana have also come up with the same.
 Primary objective is to provide affordable housing to all sections of society
by 2022
 Employment : Construction sector is 2nd largest employment provider after
agriculture in this country . mostly the poor people gets employed in this
sector as the labourer . so it will generate more employment opportunists.
Economic :
 GoI projection to bring $ 1 Trillion investment by 2017
 To increase the contribution of construction sector to 12%
 Affordable housing policies help lower sections to get home in cheap prices
 LARR (Amendment) Bill, 2015: Amendments proposed on March 9, 2015
The Right to Fair Compensation and Transparency in Land Acquisition,
Rehabilitation and Resettlement (Amendment) Bill, 2015 was introduced in
Lok Sabha on February 24, 2015 to replace an Ordinance. The following
amendments were circulated by the government on March 9, 2015.
Environmental :
 Announcement on 20 smart cities
 National Green Highway mission
 India signs UN climate change Paris agreement
 Notification on Integration of Environmental Conditions in Building and
Construction Sector 2015
o Change to public purpose ƒ The Bill amends the Act to include
acquisition of land for private hospitals and private educational
institutions within the definition of public purpose. ƒ The amendments
remove this provision of the Bill. This implies that acquisition of land
for private hospitals and private educational institutions is no longer
included within the definition public purpose.
o Changes to five categories of exempted projects: ƒ The Bill allows the
government to exempt five categories of projects from: (i) Social
Impact Assessment, (ii) limits onacquisition of irrigated multi-cropped
land, through a notification, and (iii) consent provisions. These five
categories are: (i) defence, (ii) rural infrastructure, (iii) affordable

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housing, (iv) industrial corridors, and (v) infrastructure and social
infrastructure
o . The amendments make the following changes to this provision: ƒ
Industrial corridors: The amendments clarify that land acquired for
industrial corridors will be for industrial corridors set up by the
government and government undertakings. Further, land can be
acquired up to 1 km on bothsides ofthe designated railway line or road
of the industrial corridor. ƒ
o Social infrastructure: The amendments remove social infrastructure as
an exempted category.
o Changes to SIA and limits on irrigated multi-cropped land: ƒ The Bill
allows the government to exempt the above five categories of projects
from SIA and limits on irrigated land, through a notification. The
amendments add that before issuing this notification, the government
must ensure that the extent of land being acquired is in keeping with the
minimum land required for such a project.
o Survey of wasteland: ƒ The amendments add that the government
must conduct a survey of its wasteland including arid land, and
maintain a record containing details of suchland, as may be prescribed
by the government
o . Changes to rehabilitation and resettlement: ƒ Under the Act, the
rehabilitation and resettlement award for each affected family includes
employment for at least one member of the family. ƒ The amendments
change this provision to ensure compulsoryemployment to at least one
member of such an ‘affected family of a farm labourer’.
o Changes to Land Acquisition, Rehabilitation and Resettlement
Authority: ƒ The Act provides for the establishment of a Land
Acquisition, Rehabilitation and Resettlement (LARR) Authority which
may beapproached in casea personis not satisfied with an award under
the Act. ƒ The amendments state that the LARR Authority must hold
its hearing in the district where the land acquisition is taking place, after
receiving a reference from the Collector and giving notice of this
reference to all concerned parties.
 All these policies are towards the sustainable natural environment.
Infrastructural (Man Made )
 National highways & Expressways

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 Special Economic Zones
 Industrial Corridor
o A National Industrial Corridor Authority, with its headquarters in Pune
is being set up to coordinate the development of Industrial Corridors
with emphasis on Smart Cities linked to transport connectivity to spur
growth in manufacturing and urbanisation.
Problem Analysis
Barriers in sustainable development
 Corruption
o In India Corruption Rate is very high and especially in construction
sector it is highest
o Major Construction companies bribe lots of money to politicians to get
contract
o Also construction companies do not use proper materials during
construction.
o Bribe increases the project cost and decreases the quality.
 Execution Framework
o Although the new Government of India have clear vision towards
sustainable development of country but there is lack of executional
framework and time limit.
 Technology
o Technology of India is yet far behind of other countries . most of
automatic robotics technology we have to buy from other developing
nations which requires huge cost.
 High Investment
o All these projects like Smart Cities, Expressways are requires a huge
investment.

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Solutions
 Initiatives on Single Window Approvals:
World Bank report on Ease of Doing Business 2015 has ranked India
at 142nd in overall rankings out of 189 countries. Particularly, India
ranks 184th out of 189 Countries in dealing with construction permits.
In this regard, the Ministry of Housing and Urban Poverty Alleviation
is coordinating with various Ministries in enhancing the ease of doing
business in respect of construction permits and the Hon’ble Minister
had held meetings in February, May, August, September and October,
2015 with the key ministries like Environment & forests, Urban
development, Defence, Civil Aviation, Culture and Consumer affairs
for fast tracking of NOCs to housing projects and also addressed the
Chief Ministers of states & UTs.
Mostof the Ministries have agreed in principle to delegate the approval
authority to the State/ULBs by setting in overall frameworks for
approvals. The MoEF&CC has prepared Draft guidelines for
environmental clearance along with a simplified checklist for
environmental compliance by ULBs. The Ministry of Culture has
signed an MoU with ISRO for survey and mapping of all the 3,686
protected monuments in the country thus enabling online approvals and
mobile based apps. The Ministry of Civil Aviation is preparing Colour
Coded Zoning Maps (CCZMs) that would enable ULBs accord
approvals without the applicants going to the AAI. The MoUD has
prepared Model Building Byelaws 2015 drafted with a chapter on Ease
of Doing Business and the MoConsumer Affairs is updating the
National Building Code. The objective of such exercise is to ensure
approvals of projects within 30 days.
 eProcurement System : The eProcurement System of India enables
the Tenderers to download the Tender Schedule free of cost and then
submit the bids online through this portal. This helps in increasing
transparency & accountability and reduces corruption.

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o Non-standard bidding documents can create space for
manipulation and lead to opaque decision making. In order to
reduce the opportunities for corruption, it is essential that
administrative procedures and decisions happen in full
compliance with the law, in a transparent manner and with
limited discretionary decision-making powers
 FDI POLICY
Construction - Development projects (which include development of
townships, construction of residential/commercial premises, road or
bridges, hotels, resorts, hospitals, educational institutes, recreational
facilities, city and regional level infrastructure, townships) - 100% FDI
through automatic route is permitted. The conditions under this sector
are:
 No minimum land area requirement in case of development of
serviced plots.
 In case of construction-development projects, minimum floor area
of 20,000 sq. mts.
 It is clarified that 100% FDI under automatic route is permitted in
completed projects for operations and management of townships,
malls/shopping complexes and business constructions.
 FDI is not allowed in the real estate business or construction of a
farmhouse and trading in transferable development rights (TDR).
 100% FDI is allowed under the automatic route for urban
infrastructure areas like urban transport, water supply, sewerage and
sewage treatment subject to relevant rules and regulations.
FDI Policy for Industrial Parks:
100% FDI is allowed under the automatic route. ‘Industrial Park’ is
a project in which quality infrastructure in the form of plots of
developed land or built-up space or a combination with common
facilities is developed and made available to all the allotted units for
the purposes of industrial activity.
 Leasing Technologies: Most of the technologies change frequently so
it is affordable to take it on lease rather than buying it.

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 Execution regulationsystem : There should be a fixed accountability
of these ministries on the execution of these projects and plan. & if t
not performing well then proper action should be taken on ministers.
 CostProfit analysis : Before starting any bidding process government
should do cost profit analysis and give tender on that value on which
companies could not able to make excess profit .
Conclusion
 It’s very long way to go to attain the sustainability in construction sector.
 Current government policies are the positive step to attain sustainability.
 It is important to take corrective measure to remove the barriers like
corruption.
 Most of country’s sustainable development depends on this sector.
 It sustainable development in this sector can help in improving the quality of
life of citizens.
References
 http://envfor.nic.in/content/gsr3999-e-09-12-2016-notification-integration-
environmental-conditions-building-and-construc
 http://envfor.nic.in/sites/default/files/Building%20and%20Construction.pdf
 http://mhupa.gov.in/User_Panel/UserView.aspx?TypeID=1414
 http://socialjustice.nic.in/UserView/index?mid=76662
 http://www.makeinindia.com/sector/construction
 http://www.nhai.org/index.asp