Union Budget 2022, A Big Push For The Construction and Infrastructure Industry

Union Budget

union BuDget 2022, a Big push for the construction anD infrastructure inDustry

The Union budget for the year 2022-23 has a big impetus on infrastructure and construction industry. The policies made by the government for roads and highways, affordable housing etc. is a big and much required push to the construction industry. We have passed hree COVID waves and their various interruptions appear to have been left behind. In light of this, the Finance Minister Nirmala Sitharaman has delivered a "nation-building Budget" that prioritises the development of core infrastructure, which is critical for economic growth, and allocates funds to critical sectors such as education and healthcare, as well as numerous initiatives aimed at achieving inclusive growth. PM Gati Shakti was kindled by the seven engines of roads, railroads, airports, ports, mass transportation, waterways, and logistics, according to Finance Minister Nirmala Sitharaman, who presented the Union Budget 2022. According to FM, this will assist the economy advance. "In 2022-23, the PM Gati Shakti Master Plan for Expressways will be implemented, allowing for faster mobility. In 2022-23, the National Highway network would be developed by 25,000 kilometres, costing Rs 20,000 crore." What’s in budget 2022-23 for Real Estate? The Union Budget 2022-23 statements appear enabling and futuristic, with a major focus on affordable housing and infrastructure development. Due to the Coronavirus-related issues, India's real estate sector has suffered from a housing sales slowdown, reduced site visits, and project delays in recent years. Budget plans for 2022-23 have given a boost to the affordable housing industry and decreased anti-dumping duties on steel. Let's take a closer look at the recommendations and their impact on the real estate industry. The finance minister has advised that over 80 lakh affordable dwellings be built and delivered by the year 2023, in order to give the 'Housing for All' campaign a boost. These homes will be built as part of the Pradhan Mantri Awas Yojana, the government's flagship housing development programme (PMAY). It will give the economically disadvantaged a chance to acquire a home at a reasonable price.

Union Budget

nion Budget u

In addition, the Finance Minister has requested an allocation of Rs 48,000 crore for stalled projects under the country's affordable housing initiatives. It will allow for the prompt completion of projects that are currently under construction. The real estate industry is not self-contained; it collaborates with other industries such as steel, iron, cement, and other linked products. The Finance Minister has cancelled the Countervailing Duty and Anti-dumping Duty on stainless steel, coated steel, alloy steel bars, and high-speed steel in the Union Budget 2022-23 announcements. The decision was made to provide immediate help to the steel industry, which has been hit hard by recent increases in metal prices. It will also limit Chinese imports while promoting domestic manufacturing. It will have a direct influence on the construction and related businesses, as steel and steel products are used extensively in house construction. The Union Budget for 2022-23 emphasised the importance of developing Mega Cities as well as a greater focus on Tier 2 and Tier 3 cities. In the not-too-distant future, these cities will be transformed into economic powerhouses. The government seeks to assist and collaborate with states in the development of urban capacity. The Union Government has announced the formation of a high-powered committee to make policy recommendations and capacity building linked to urban infrastructure development in order to bring a could not be maintained. The Union Government has strengthened its attention on infrastructure development in the Union Budget 2022-23. The National Highways will be expanded by 25,000 kilometres over the next year under PM Gati Shakti's leadership. The government wants to implement the National Ropeway Programme in Public-Private Partnership to promote connectivity (PPP). Roads, Railways, Airports, Ports, Mass Transportation, Waterways, and logistic Infrastructure are the seven engines of PM Gati Shakti. The creation of 100 new freight ports will enhance the country's infrastructure and construction industries. The Union Budget 2022-23 is forward-looking, focusing on a long-term plan for the country that prioritises technology, urban growth, and sustainability." The Pradhan Mantri Awas Yojana, which would see the construction of 80 lakh homes, has an allocation of Rs 48,000 crores in the budget for the real estate sector. This demonstrates the government's commitment to constructing affordable housing stock once again. However, we would have preferred greater demand-side support, such as the extension and expansion of the credit-linked subsidy scheme What’s in Budget 2022-23 for Roads and Highways? The Ministry of Road Transport and Highways experienced a 68 percent rise in financial allocation for the next fiscal year, thanks to the Budget speech's emphasis on infrastructure development for economic growth and job creation. For the fiscal year 2022-2023, the Ministry has been given Rs. 1,99,107.71 crore, up from Rs. 1,18,101 crore in the previous year's Budget projection. The National Highways Authority of India (NHAI) would receive a substantial portion of the additional 81,000 crore awarded to the Ministry this year, with its allocation increasing by 133 percent (76,665 crore) to 1,34,015 crore. The Finance Minister, has also set a goal of increasing the country's National Highways network by 25,000 kilometres in 2022-2023, up from 12,000 kilometres in fiscal year 2022. However, this does not imply that the annual target for National Highways will be doubled. Ms. Sitharaman named the PM Gati Shakti programme as the government's top priority, out of a total of four, which included inclusive development, productivity increase, and investment financing. The programme, which was announced in October 2021, envisions a digital platform with a national

masterplan for various infrastructure Ministries by bringing together 16 ministries, including railways, roads, shipping, and aviation, as well as states, for integrated planning and implementation of infrastructure connectivity projects. The "PM GatiShakti Master Plan for Expressways" will be developed in 2022-23 to let people and products move more quickly. During the next three years, the programme will also permit the construction of 100 cargo ports. In 2022-23, a National Ropeways Development Program will be launched as a public-private collaboration to increase connectivity in mountainous areas, with eight ropeway projects totaling 60 kilometres to be granted. Ropeways "may also span congested urban areas where conventional mass transit systems are not practical.” The FM announced a 44,000 crore budget for the Ken Betwa River project. She also announced a 1 lakh crore 50-year interest-free credit to states to help them catalyse overall investment in the economy in FY 2022-23. In hill states, the 'Parvatmala' scheme proposed in the Union Budget could be a game changer. In the coming fiscal year, eight ropeway projects totaling 60 kilometres will be built in hill states. The initiative aims to improve modern modes of transportation in the highlands while also providing a boost to border villages in distant places. "The National Ropeways Development Program, 'Parvatmala,' is a gift to the hill states," said Union Road Transport and Highways Minister Nitin Gadkari. The project will provide pollution-free transportation as well as other benefits. Contracts will be given for four multimodal logistics parks (MMLPs) in Nagpur, Chennai, Bengaluru, and Indore. The Union Cabinet approved 35 MMLPs in 2017. The FM announced that Rs 1 lakh crore will be granted to help states catalyse overall investments in the economy, and that it would be used for PM Gati Shakti-related projects, PM Gram Sadak Yojana financing, and other productive capital. In 2022-23, the railways would be given a budget of 2.38 lakh crore for capital expenditure, with 400 Vande Bharat high-speed trains and 100 PM GatiShakti cargo facilities to be developed in the next three years. The national transporter will also expand on the "One Station, One Product" concept, which will aid in the development of efficient logistics for farmers, agribusinesses, and small businesses. Last year, it set a capital expenditure target of 2.15 lakh crore. The Budget has allocated Rs 19,130 crore for metro projects across the country. Union minister Hardeep Singh Puri said in November last year that 723 kilometres of metro network were operating in 18 cities, with another 1,000 kilometres under construction in various locations. The government's ongoing focus on agricultural and rural development is reflected in a 2% increase in budgetary allocation in FY2023 compared to FY2022, to $2.7 trillion. This is predicted to boost agricultural income and, as a result, demand for rural housing, which accounts for roughly 30% of total cement consumption. Furthermore, the target of 80 lakh houses being built under PMAY, both rural and urban, with a budgetary allocation of 480 billion and a 35 percent increase in capital outlay to 7.5 trillion, including an additional allocation of 1.0 trillion for state government projects, is expected to boost cement demand. The government is promoting the building and infrastructure industries in a variety of ways and with a significant amount of new funding. The construction sector's push will have a direct impact on the construction equipment business. India's construction equipment industry is broad and diverse, including both international and domestic manufacturers. With the construction of new roads and highways, as well as housing projects, the industry will experience an increase in demand and new development. CM