Industry Overview of Procurement in Engineering & Construction Sector
India’s engineering industry contributes to 27% of the total factories in the industrial sector and accounts for 63% of total overseas collaborations. The EPC sector alone has around 180 active players. Initiatives like the Global Housing Technology Challenge-India, AMRUT, RERA (2016) and a modified GST regime are expected to drive this sector's growth.
The global civil engineering market is projected to reach $12.08 trillion by 2025, growing at a CAGR of 5.6%. Additionally, rising disposable income combined with an expanding middle-class population in India and China are fueling demand. Technological advancements, government investments, and increasing residential infrastructure needs are set to further boost the sector. Plus, new software solutions, government infrastructure investments, incentives in developing countries, and increasing residential demand are key drivers of growth in the E&C industry.
Core Challenges in the Engineering and Construction Industry
The sector faces numerous challenges, with the most prominent being
Project Scale & Complexity
Growing project sizes lead to cost overruns
Price Volatility
Frequent fluctuations in material and machinery prices
Skilled Labor Shortage
Lack of cost-effective and skilled workforce
Rising Costs
Production, transportation, and investment costs continue to surge
Raw Material Scarcity
Limited availability of essential materials
