Macro-economic factors- GDP FDI UNEMPLOYMENT DEMOGRAPHY FISCAL POLICY GOVERNMENT POLICIES

1. GROUP – 5
ROHITH RAJEEV – 20DM180
S.GOVIND – 20DM182
SNIGDHO SUMAN PAUL- 20DM214
SREEHARI DEVADAS – 20DM216
SUBHHADEEP GUHA – 20DM218

2. INTRODUCTION
• As an industry sector, construction accounts for more than 10% of
global GDP (6-9% in developed countries) and employs around 7% of the
global workforce - over 273m people.
• The sector is Labour-intensive and, including indirect jobs, provides
employment to more than 49.5 million people.
• The industry contributes 55% share in the Steel industry, 15% in the Paint
industry and 30% in the Glass industry.
• The Construction industry in India is expected to grow at 5.6% during
2016-20, compared to 2.9% during 2011-15.
• India was ranked 44 out of 167 countries in World Bank's Logistics
Performance Index (LPI) 2018. India ranked second in the 2019 Agility
Emerging Markets Logistics Index.

3. ADVANTAGES OF CONSTRUCTION INDUSTRY
• Robust Demand
• Attractive Opportunities
• Policy Support
• Increasing Investments

4. MAJOR COMPANIES IN CONSTRUCTION INDUSTRY

5. IMPACT OF COVID-19
• Government restrictions
• Supply chain and product sourcing interruptions
• Planning
• Design
• Construct
• Cost

6. MACRO-ECONOMIC FACTORS
GROSS DOMESTIC PRODUCT-
• In July 2020, India's construction sector was valued at
over 1.3 trillion Indian rupees. This was a significant dip
compared to January the same year, attributed to the
coronavirus (COVID-19) pandemic.
• Construction Industry Halves, as GDP Takes Record Blow.
• Valuation of the industry.
• Construction industry post COVID-19.

7. INFLATION-
• Inflation plays a vital role in the price
increase of materials, labors, and
machinery, which results in deviating
the initial and the final cost of the
project.
• Construction costs have reportedly
fallen for the first time since 2010.
• The construction sector comprises two
major components: labour and
materials.

8. DEMOGRAPHY-
• Around 40% of working age
population is in construction
industry.
• 30% of workforce is women.
• Almost 65% of the women work as
construction labourers.
• Employment rate is growing at 7%.

9. DISPOSABLE INCOME-
• At minimum wage rate, a construction
worker earns around 1,60,704 per annum.
• Since there is no tax for income earners
below 2 lakh rupees per annum, this will be
their disposable income.
• Since government cannot ensure the wages
rising in informal sector, they can raise the
minimum wages.
• This can ensure the rise in disposable
income of around 40% of the working age
population.

10. FISCAL POLICY-
• Increase in fiscal deficit of central and state governments is
likely to impact the sector.
• Fiscal deficit - 12.1%.

11. UNEMPLOYMENT-
• Under pressure since 2016.
- Demonetization.
- GST
- Covid-19
• Unemployment rate – 24.3%.

12. FOREIGN DIRECT INVESTMENT-
 India requires investment worth Rs 50 trillion
(US$ 777.73 billion) in infrastructure by 2022
to have sustainable development in the
country.
 $25.04 bn FDI equity Inflows in Construction
Development during April 2000 – March 2020
 $540 mn overseas investment in the
Construction Industry in India during April
2007 – March 2019
 $16.2 bn FDI in Construction Development In
North India and South India in construction
(infrastructure) activities during April 2000 –
December 2019.

13. GOVERNMENT POLICIES-
• Construction of roads.
• Border Road Organisation.
• Indian Energy Sector.
• Union Budget 20-21.
• Communication Sector.
• Indian Railways.
• Ministry of Housing and Urban Affairs.
• Increase in Investment of Infrastructural development.

14. FUTURISTIC TRENDS-
• Prefabricated construction
• Huge demand for waterproofing of all kinds of Structures
• Green construction
• Micro-apartments
• Building information modelling (BIM)
• Monolithic Concrete Construction
• Tunnel Form Construction Technique
• Air purifiers

15. ROAD AHEAD-
• The infrastructure sector has become the biggest focus area for the
Government of India. India plans to spend US$ 1.4 trillion on
infrastructure during 2019–23 to have a sustainable development of
the country. The Government has suggested investment of Rs
5,000,000 crore (US$ 750 billion) for railways infrastructure
between 2018–2030.
• India and Japan have joined hands for infrastructure development
in India's Northeast states and are also setting up an India-Japan
Coordination Forum for Development of Northeast to undertake
strategic infrastructure projects for the region.