What Has Been the Progress in the Construction of Transport and Logistics Infrastructure in India till Now in 2023?
As of 2023, India has witnessed significant progress in the construction of transport and logistics infrastructure. The government has undertaken various initiatives to enhance connectivity and facilitate efficient movement of goods and people across the country.
Several notable developments have taken place recently. One of them is the construction of expressways, like the Delhi-Mumbai Expressway and the Chennai-Bengaluru Expressway. These expressways are built with the aim of decreasing travel time and to increase trade.
The expansion of the railway network, including dedicated freight corridors, has improved cargo transportation capabilities. Additionally, major ports have undergone expansion, enabling maritime trade.
The Bharatmala and Sagarmala projects have been implemented. This has increased the development of road and port infrastructure. This, in turn, has improved connectivity and stimulated economic growth.
What Are the Major Opportunities for EPC Infrastructure Companies in Transport and Logistics Systems Construction?
- Opportunities for EPC infrastructure companies in the construction of roads & bridges
There are 389 projects worth INR 382000 crores under conceptualization in the roads & bridges sub sector. There are 1210 projects worth INR 1128000 crores under development. Further there are 1580 projects worth INR 1478000 crores.
- Opportunities for EPC infrastructure companies in the construction of airports
In the airports and civil aviation sub-sector, there are 30 projects worth INR 37372 crores under conceptualization. Further, there are 13 projects worth INR 30709 crores under development and 70 projects worth INR 80781 crores under implementation.
- Opportunities for EPC infrastructure companies in the construction of ports & terminals
The ports & terminals sub-sector in India has 8 projects worth INR 3696 crores under conceptualization. There are 18 projects valued at INR 23651 crores in the ports & terminals sub-sector which are under development. Moreover, there are another 35 projects worth INR 19803 crores which are under implementation.
- Opportunities for EPC infrastructure companies in railways
The railway sub-sector has experienced several local manufacturing and sourcing projects in the last few years. These projects are in line with the Make in India policy initiative.
The most noteworthy accomplishment in Indian railways due to local manufacturing is the launch of the Vande Bharat express trains.
There are 69 projects worth INR 203000 crores under conceptualization and 96 projects worth INR 118603 crores under development. Further there are 74 projects of INR 1068000 crores under implementation.
- Opportunities for EPC infrastructure companies in building urban public transport systems
The public transport systems sub-sector in India has seen a massive spur in activity in recent years. The Government of India has set an ambitious goal. They plan to build 1000 kilometers of metro railway services across nine cities by 2030. This will revolutionize the way people travel in India.
There are 16 projects worth INR 15748 crores under conceptualization in the urban public transport systems sector. There are another 11 projects worth INR 67924 crores under development and 30 projects worth INR 416000 crores.
- Opportunities for EPC infrastructure companies in bulk material transportation systems
In recent times the Government of India has taken a slew of initiatives to build infrastructure for bulk material transportation. The most noteworthy projects in this sub-sector include the Eastern Dedicated Freight Corridor and the Western Dedicated Freight Corridor.
There are 80 projects in the bulk material transportation sub-sector worth INR 28394 crores currently being conceptualized. Additionally, 57 projects worth INR 89307 crores are in the process of development. Further there are 14 projects worth INR 17742 crores under implementation.
What Supply Chain Solutions Do EPC Infrastructure Companies Need to Leverage Opportunities in the Logistics & Transport Sector?
- Single Source of Truth for Collaboration Among All Stakeholders in the Supply Chain
EPC infrastructure projects in the logistics & transportation sub-sector have many moving parts. From conceptualization of the project to its commissioning, all stakeholders in the supply chain must rely on a single source of truth for material flow, work-in-progress, fund flow, and data flow.
These stakeholders include the EPC project developer, sub-contractor, raw materials and machinery supplier, and lender.
End-to-end digital transformation of the supply chain can enable stakeholders to identify congestion points, reasons behind the congestion, and take quick action to unclog bottleneck areas.
Here’s a use case on an award-winning digital procurement supply chain transformation from an EPC company which is part of a salt-to-sky conglomerate.
- Seamless Synchronization Across Logistics, Payment, and Delivery
Once all stakeholders in the supply chain are on the same page, the next step is to enable decision making and action. This calls for seamless synchronization among multiple processes in the procure-to-pay cycle.
These processes include the issue of purchase orders, requests for quote, onsite delivery of construction raw materials, consumables and MRO items, and finally, payments,
Procure-to-pay automation and integration can enable all stakeholders to make decisions, act fast, and execute the project as per the construction schedule.
- Agile Procurement of Construction Raw Materials and MRO Items as per the Bill of Quantities
40% of road projects face delays in project execution and construction, as per MoSPI reports. In 2023, the speed of national highway construction in India has improved to 24.14 KM per day. However, there is plenty of room for improvement.
A significant speed breaker in the logistics & transportation sector is the purchase requisition to purchase order (PR-to-PO) process. In some EPC infrastructure companies that still rely on manual processes, the PR-to-PO cycle time is 4 days.
Catalog-based buying can reduce the PR-to-PO cycle time for purchase of construction raw materials and MRO items to 3 minutes. What does that mean?
With catalog-based buying an EPC road developer can save 4 days. At the current rate of road construction, it can build an additional 96.56 KM.
For a road development project of 1 KM aggregate lead in the state of Uttar Pradesh, with greenfield alignment of 2 lanes +PS (BC, DBM, WMM & GSB), it can lead to additional revenue of INR 3.44 crores. Here’s a use-case on the agile procurement of steel TMT bars and AAC blocks with a turnaround time of 4 days.
- Alignment of Parts and Components as Per GAD/GFC Drawings
Another pain point faced by EPC infrastructure companies in the logistics & transportation sub-sector is the alignment of parts and components. There is very little margin for error in heavy, equipment, and general fabrication.
A solution that can serve EPC companies well is a digital project management solution. It allows users to track work-in-progress for fabrication requirements for roads, bridges, airports, tunnels, and ports.
It is important to lock the engineering and drawing and educate suppliers on the SLAs of a fabrication project from the word “go”.
A digital project management solution can enable EPC companies to monitor SLAs for quality metrics as per GAD/GFC drawings.
Here’s a use case on the alignment of parts as per GAD/GFC drawings for the fabrication of piers and pier cap shutterings from India’s first bullet train project on the Mumbai-Ahmedabad route.
- Agile Best Price Discovery for Procurement of Construction Raw Materials and MRO Items
It is impossible for EPC companies to do away with spot buying, especially for the purchase of construction raw materials.
Major reasons for spot buying include high inventory carrying costs and the balance sheet impact of a delta due to a sudden change in the cost of capital.
A solution that can enable ease of doing business for infrastructure project developers and subcontractors working on construction projects for roads, bridges, tunnels, airports, and ports is an RFQ automation tool.
An RFQ automation tool allows users to request quotes of multiple line items as per all attributes in the bill of quantities, at one go.
It is even better if the RFQ automation tool can give instant quotes to users. It saves significant time on the best price discovery.
Here’s a use-case on agile best price discovery of structural steel by a leading EPC road developer in India.
- Granular Manufacturing Processes for Quality Fabricated Structures
What happens when fabricators build a large structure at one go? While it may appear to save time and costs on paper, the ground reality is different.
It is always safer to bulk break a large heavy fabrication project into a sum of parts. Granular manufacturing allows fabricators better monitoring of fabricated structures and easier course correction. The probability and costs of re-work are lower.
Here’s a use-case on a granular approach to manufacturing of pre-engineered buildings from 150 years+ old civil construction company in India.
The Catalog for EPC Project Developers and Sub-Contractors That Are Building India’s Logistics & Transportation Infrastructure
Moglix offers a comprehensive catalog of construction raw materials procurement, indirect procurement, and custom manufacturing solutions to EPC project developers and sub-contractors.
To know more about opportunities in the logistics & transportation sub-sector in India’s National Infrastructure Pipeline, download our e-book “Building India: The Infrastructure We Aspire for and the Supply Chain We Need, Second Edition.”
