ICRA flags road construction slowdown in FY2025-26
Rating agency ICRA in its latest report has showed that the road sector is expected to see a slowdown in FY2025-26, with construction under the Ministry of Road Transport and Highways (MoRTH) estimated to decline to 9,500-10,000 km from 10,660 km in FY2024-25, amid continued slowdown in project awarding and disruptions caused by the early onset and elongated monsoon across the country.
According to the report, road execution by the MoRTH is likely to slow further to 9,000-9,500 km in FY2026-27. Road awards by the MoRTH are estimated at 7,250-7,750 km for FY2025-26, largely in line with 7,538 km of road awards for FY2024-25, while remaining lower than FY2020-21 - FY2022-23 levels.
It further stated that road awards for 8M FY2025-26 stood at 1,951 km, 24% lower than 2,558 km awarded in 8M FY2024-25, with higher awarding expected in Q4 FY2025-26. Several projects are in the bidding process at present, but awarding is yet to happen. Road execution under MoRTH declined by 3% on a YoY basis to 4,612 km in 8M FY2025-26 from 4,761 km in 8M FY2024-25 owing to declining order book.
