Infra and transport sectors expect growth in the next three years

India is preparing for one of the 21st century’s largest infrastructure programs, highlighted in KPMG’s “2024 Infrastructure and Transport CEO Outlook” report. As a leading global economy, India’s infrastructure growth will depend significantly on mobilizing fiscal capital for these projects.

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India is gearing up for one of the largest infrastructure programs of the 21st century, a bold initiative outlined in KPMG’s “2024 Infrastructure and Transport CEO Outlook” report. As one of the world’s largest economies, India’s infrastructure expansion will rely heavily on generating fiscal sources of capital to fuel projects. This transformation is anticipated to have wide-reaching implications on economic growth, sectoral employment, and technological integration.

The KPMG report, based on a survey of 120 global sector leaders, shows optimism among CEOs in the infrastructure and transportation sectors. The findings reveal that leaders anticipate robust growth over the next three years, both in terms of revenue and headcount. However, the report highlights a critical challenge: the increasing pressure from stakeholders on Environmental, Social, and Governance (ESG) standards. Fifty-seven percent of CEOs globally feel that evolving ESG expectations are outpacing their organizations‘ abilities to adapt effectively.

Environmental concerns weigh heavily on the minds of these CEOs, with over half acknowledging that a failure to address climate change could have serious short- to medium-term consequences for business growth. This concern underlines the need for infrastructure and transportation companies to integrate climate adaptation strategies into their operational planning.

Trust in government institutions is waning globally, a trend that has placed additional pressure on businesses to address societal challenges. According to the report, 62 percent of CEOs believe the public expects companies to step up in areas where governments are perceived to be faltering. In a noteworthy finding, 71 percent of sector leaders indicated a willingness to divest profitable yet reputation-damaging business segments, suggesting a commitment to upholding their organizations’ public image.

In India, the focus on infrastructure also includes embracing emerging technologies, with generative AI seen as a transformative tool for the sector. Manish Aggarwal, a KPMG partner, notes that AI-driven innovation is a high priority for CEOs in India’s infrastructure sector, enabling operational efficiencies and enhancing strategic decision-making capabilities.

KPMG’s survey involved 1,325 CEOs from 11 major economies, each representing companies with over USD 500 million in annual revenue. This year’s edition marks the 10th in KPMG’s CEO Outlook series, offering insights into CEO priorities across global markets and industry sectors, including infrastructure and transportation. As India moves forward with its infrastructure agenda, aligning capital generation with sustainable practices and technological adoption will be key drivers of success in the sector.