India Emerges as World’s Second-Largest Contributor to Global Construction Growth, Report Finds

Mumbai / Berlin, June 10, 2026: India has established itself as the second-largest single-country contributor to global construction growth between 2020 and 2030, according to the latest “State of the Project Economy 2026” report released by Foundamental. The Berlin-based venture capital firm, which specializes in architecture, engineering, and construction technology, revealed that India and China together account for nearly 40% of all global construction expansion over the decade.

According to a press release, the report highlights an increasing concentration of global capital expenditure within just five powerhouse nations: India, China, the United States, Germany, and France. This shift comes as global gross fixed capital formation has grown roughly 30-fold since 1960.

“India accounts for the second-largest share of global construction growth by volume between 2020 and 2030, at 14.1%, behind only China at 26.1% and ahead of the United States at 11.1%,” said Shubhankar Bhattacharya, Co-Founder & General Partner at Foundamental.

Construction Spending and Infrastructure Surges

According to the study, global construction spending reached US$15.97 trillion in 2024 and is on track to hit US$19.86 trillion by 2028, representing a compound annual growth rate (CAGR) of 5.6%. This trajectory solidifies construction as one of the single largest sectors of the global economy.

Globally, infrastructure is leading the charge as the fastest-growing major construction segment, expanding at a 5.1% CAGR between 2020 and 2025. However, India is significantly outbidding the global average. Driven by rapid urbanization, manufacturing-led growth, and aggressive state pipelines for highways, railways, airports, and industrial corridors, India’s infrastructure market is forecast to grow at roughly 8% annually through the end of the decade.

“Global construction spending has already surpassed previous forecasts and is creating new opportunities across infrastructure, industrial facilities, energy systems, transportation networks and digital infrastructure,” Bhattacharya noted.

Foundamental emphasizes that India’s expansion is increasingly defined by discrete, time-bound projects across infrastructure, energy, real estate, and manufacturing rather than routine business operations—a structural shift that signals a maturing project economy.

Five Structural Forces Shaping the Global Market

The report identifies five primary forces currently reshaping the international construction landscape:

• Re-industrialization: Manufacturing reshoring in the US and Europe is driving massive initial construction demands, though actual project delivery output is currently lagging behind corporate announcements.
• Data Center Construction: Fueled by artificial intelligence and cloud computing, the global data center construction market is projected to double by 2030 compared to 2018 levels.
• Energy Infrastructure: The rapid rise of data centers and broader electrification is severely outstripping grid capacities, requiring massive grid transmission and distribution upgrades globally.
• Civil Infrastructure: Traditional civil works—including roads, rail, transit, ports, and water systems—remain the fastest-growing macro segment.
• Defense Infrastructure: A structural, long-term defense spending super-cycle is underway, with significant, underappreciated opportunities lying in the construction and maintenance of facilities rather than just new hardware systems.

The Massive Data Center and Energy Build-Out

The skyrocketing demand for AI adoption, digital public infrastructure, and data-localization requirements is expected to heavily accelerate data center investments specifically within India.

“Data centre construction could add between 10% and 15% to the global construction market by 2030,” Bhattacharya stated.

This digital footprint requires a parallel upgrade in power. Each new data center triggers heavy civil work and grid modernization. Consequently, Foundamental projects that India will require substantial, sustained investment over the next decade across renewable energy, transmission networks, battery storage, and green-hydrogen infrastructure.

The report concludes that the next wave of value creation in the sector will belong to technologies that help convert this unprecedented influx of investment capital into completed physical assets more efficiently and predictably. With multiple macroeconomic tailwinds aligning at once, India is poised to remain a dominant force leading the global project economy through 2030.