India Roads and Highways Market By Road Type (National/Interstate Highways, State Highways, Other), By Components (Road, Bridges/Tunnels/Culverts, Marking & Signage, Safety Equipment, Traffic Management System, Others), By Process (Maintenance, Expansion), By Region, Competition Forecast & Opportunities, 2021-2031F

Market Overview

The India Roads and Highways Market size accounted for USD 155.48 Billion in 2025 and is predicted to increase from USD 156.39 Billion in 2026 to approximately USD 269.93 Billion by 2031, expanding at a CAGR of 9.63% from 2026 to 2031.

Key Takeaways

• By road type, the National/Interstate Highways segment accounted for the largest market share 54% in 2025, driven by continuous government investments in expressways, economic corridors, and national connectivity projects.
• By components, the road segment held the highest market share 61% in 2025, supported by extensive construction, widening, resurfacing, and rehabilitation activities across the national highway network.
• By components, the traffic management system segment is expected to register significant growth during the forecast period, driven by the increasing deployment of intelligent transportation systems (ITS), electronic tolling, and smart traffic monitoring technologies.
• By process, the expansion segment dominated the market with share 63% in 2025, owing to the ongoing development of greenfield expressways, highway widening, and lane augmentation projects across the country.
• By process, the maintenance segment is expected to register the fastest CAGR during 2026–2031, supported by the growing road network, increasing emphasis on asset lifecycle management, and higher investments in highway rehabilitation and preventive maintenance.
• By region, South India emerged as the largest regional market with share 35% in 2025, driven by extensive investments in national highways, industrial corridors, ports, logistics infrastructure, and urban connectivity projects.
• Increasing investments under Bharatmala Pariyojana, PM Gati Shakti, National Infrastructure Pipeline (NIP), and expanding public-private partnership (PPP) projects are expected to drive the long-term growth of the India roads and highways market.

Market Drivers

Government Infrastructure Programs Accelerating Highway Development

Government-led infrastructure initiatives remain the primary driver of India's roads and highways market. Programs such as Bharatmala Pariyojana, PM Gati Shakti National Master Plan, and the National Infrastructure Pipeline (NIP) are accelerating the construction of highways, expressways, economic corridors, border roads, and multimodal logistics networks. PM Gati Shakti integrates infrastructure planning across 16 ministries, improving project coordination and reducing implementation delays.

Simultaneously, Bharatmala focuses on enhancing freight efficiency, last-mile connectivity, and seamless transportation across major economic corridors. These initiatives are generating sustained demand for road construction, bridges, tunnels, intelligent traffic systems, and maintenance services. Increasing public investment and private sector participation through Public-Private Partnership (PPP) models are further strengthening project execution, creating long-term growth opportunities for engineering, procurement, and construction companies operating in India's roads and highways sector.

Rapid Urbanization and Industrial Corridor Development

Rapid urbanization and the expansion of industrial corridors are significantly driving India's roads and highways market. According to the Ministry of Statistics and Programme Implementation (MoSPI), India's urban population is projected to exceed 600 million by 2031, increasing demand for efficient transportation infrastructure and urban connectivity. Industrial corridor projects such as the Delhi–Mumbai Industrial Corridor (DMIC) and Chennai–Bengaluru Industrial Corridor (CBIC) are creating strong demand for highways, feeder roads, logistics parks, and freight connectivity.

Expanding manufacturing zones, warehousing facilities, ports, and airports require robust road infrastructure to support supply chains and regional economic development. Rising investments in smart cities, urban mobility projects, and commercial developments are further accelerating road construction and modernization, strengthening long-term demand for highway expansion and maintenance services across India.

Increasing Focus on Highway Maintenance and Smart Transportation Systems

India's expanding road network is increasing the need for efficient maintenance and technology-enabled highway management, creating a strong market driver. The National Highways Authority of India (NHAI) is increasingly adopting Intelligent Transportation Systems (ITS), electronic toll collection through FASTag, automated traffic monitoring, and digital asset management to improve road safety and operational efficiency.

The continued expansion of the national highway network has shifted greater attention toward preventive maintenance, pavement rehabilitation, bridge inspections, and lifecycle asset management. In addition, government initiatives promoting safer roads, reduced travel time, and improved logistics performance are encouraging investments in advanced traffic management systems and highway modernization. As road infrastructure expands across the country, maintenance contracts and smart mobility solutions are expected to become increasingly important, creating sustained opportunities for contractors, technology providers, and infrastructure developers.

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Market Restraints

Land Acquisition and Regulatory Approval Delays

Land acquisition remains one of the biggest challenges for India's roads and highways market. Large infrastructure projects often face delays due to land ownership disputes, lengthy compensation procedures, environmental clearances, forest approvals, and multiple regulatory requirements. Variations in state-level policies further complicate project execution and increase administrative burden. Delayed approvals extend project timelines, escalate construction costs, and affect contractor cash flows. In addition, postponed project completion impacts connectivity improvements and reduces investment efficiency. These regulatory and land-related challenges continue to hinder the timely execution of highway expansion and new road development projects.

Rising Construction Material and Project Costs

Fluctuating prices of construction materials such as steel, cement, bitumen, aggregates, and fuel significantly affect the profitability of road and highway projects. Rising transportation and labor costs further increase overall project expenditure, particularly for long-duration infrastructure contracts. Contractors often face challenges in absorbing cost escalations under fixed-price agreements, leading to reduced margins and financial stress. Supply chain disruptions and inflation also contribute to budget overruns and project delays. These cost pressures make project planning more complex and can discourage private sector participation in large-scale road infrastructure developments.

Project Execution Challenges and Skilled Workforce Shortages

Road and highway projects frequently encounter execution challenges due to shortages of skilled labor, equipment availability constraints, and coordination issues among multiple stakeholders. Adverse weather conditions, utility relocations, and disruptions in material supply further delay construction activities. Large infrastructure projects involving multiple contractors and government agencies often face scheduling conflicts and operational inefficiencies. These challenges increase project costs, reduce equipment utilization, and extend completion timelines. Limited availability of skilled professionals for advanced construction technologies and intelligent transportation systems also affects the quality and efficiency of highway development projects across India.

Market Opportunities

Expansion of Build-to-Rent (BTR) and Managed Roads and Highways

The emergence of Build-to-Rent (BTR) developments presents a significant growth opportunity for India's Roads and Highways market. Institutional investors, real estate developers, and co-living operators are increasingly exploring purpose-built rental communities that offer professionally managed services, flexible lease terms, and modern amenities. The Government's push toward formalizing the rental sector through the Model Tenancy Act, 2021, is further improving investor confidence. In addition, India's residential real estate sector attracted over USD 3 billion in institutional investments during 2024, reflecting growing interest in income-generating rental assets. Rising demand from millennials, students, expatriates, and working professionals is expected to accelerate the adoption of organized Roads and Highways, creating long-term opportunities for developers, REITs, and property management companies.

Rising Demand in Tier II and Tier III Cities

The rapid economic development of Tier II and Tier III cities is creating substantial opportunities for Roads and Highways providers. Government initiatives such as the Smart Cities Mission, covering 100 cities, along with investments in industrial corridors, logistics parks, and metro rail expansion, are generating new employment centers beyond major metropolitan areas. Cities including Indore, Coimbatore, Lucknow, Bhubaneswar, Jaipur, Kochi, and Surat are witnessing increasing migration of professionals and students, driving demand for quality rental accommodation. Additionally, the expansion of IT parks, manufacturing facilities, and educational institutions in these cities is encouraging developers to introduce affordable and mid-segment Roads and Highways projects, unlocking significant growth potential in previously underserved markets.

Technology-Driven Rental Ecosystem and PropTech Adoption

The growing adoption of PropTech solutions offers significant opportunities to modernize India's Roads and Highways market. With over 970 million internet users and widespread smartphone penetration, digital platforms are enabling online property discovery, virtual tours, e-KYC verification, digital lease agreements, AI-based tenant screening, and automated rent collection. These technologies enhance operational efficiency, improve transparency, and reduce transaction time for landlords and tenants. Furthermore, increasing integration of digital payment systems and property management software is supporting the expansion of professionally managed rental portfolios. As consumer preference shifts toward seamless digital experiences and flexible leasing models, PropTech companies and managed housing operators are well positioned to capitalize on the formalization and digital transformation of India's Roads and Highways sector.

Market Trends

Increasing Adoption of Intelligent Transportation Systems (ITS)

The adoption of Intelligent Transportation Systems (ITS) is becoming a prominent trend in India's roads and highways market. Highway authorities are increasingly deploying AI-powered traffic monitoring, electronic toll collection through FASTag, adaptive traffic signaling, automated incident detection, and CCTV-based surveillance to improve traffic flow and road safety. Real-time traffic analytics and connected infrastructure are enabling more efficient highway operations and reducing congestion. As digital transformation accelerates, technology-driven traffic management solutions are becoming an integral part of new highway projects and existing road network modernization initiatives.

Growing Focus on Sustainable and Green Road Construction

Sustainability is emerging as a key trend in India's roads and highways market. Contractors are increasingly adopting recycled asphalt pavement (RAP), plastic waste in road construction, fly ash, industrial by-products, and warm-mix asphalt technologies to reduce environmental impact. Government agencies are also promoting energy-efficient construction practices, lower carbon emissions, and resource conservation in infrastructure projects. The use of eco-friendly construction materials and sustainable engineering techniques is improving project durability while supporting India's long-term environmental objectives and green infrastructure development.

Rising Shift Toward Performance-Based Highway Maintenance

India's roads and highways sector is witnessing a growing shift from reactive repairs to performance-based maintenance contracts. Highway authorities are increasingly emphasizing preventive maintenance, digital asset monitoring, pavement condition assessments, and lifecycle management to improve infrastructure quality and reduce long-term maintenance costs. Advanced technologies such as drones, GIS mapping, IoT sensors, and predictive analytics are being used to monitor road conditions and schedule timely interventions. This trend is enhancing operational efficiency, extending road lifespan, and creating long-term opportunities for specialized maintenance contractors and infrastructure technology providers.

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Market Segmentation Analysis

By Road Type Insights

Why Did National/Interstate Highways Secure the Largest Share of the India Roads and Highways Market?

The National/Interstate Highways segment dominated the market with an approximate share of 54% in 2025, driven by continuous government investments in expressways, economic corridors, freight corridors, and inter-state connectivity projects. Large-scale highway expansion under Bharatmala Pariyojana and other national infrastructure programs further strengthened the segment's market position.

The State Highways segment accounted for an estimated 31% share in 2025 and is expected to register the fastest growth during the forecast period, supported by increasing state government investments in regional connectivity, rural development, industrial corridors, and urban expansion projects.

By Components Insights

Why Did the Road Segment Dominate the India Roads and Highways Market?

The road segment dominated the market with an approximate share of 61% in 2025, owing to extensive investments in new highway construction, lane widening, resurfacing, rehabilitation, and pavement strengthening across national and state highway networks.

The traffic management system segment held an estimated 8% share in 2025 and is expected to witness the fastest growth during the forecast period, driven by increasing deployment of Intelligent Transportation Systems (ITS), electronic toll collection, AI-based traffic monitoring, and smart highway infrastructure.

By Process Insights

Why Did the Expansion Segment Dominate the India Roads and Highways Market?

The expansion segment dominated the market with an approximate share of 63% in 2025, driven by the development of greenfield expressways, highway widening projects, bypasses, ring roads, and economic corridor construction to improve national connectivity and freight movement.

The maintenance segment accounted for an estimated 37% share in 2025 and is expected to register the fastest growth during the forecast period, supported by the increasing length of the road network, growing focus on preventive maintenance, pavement rehabilitation, bridge repairs, and long-term asset management.

Market Report Coverage and Key Metrics

Market Regional Analysis: South India, North India, West India, East India

Why Did South India Lead the India Roads and Highways Market?

South India led the market, capturing the largest revenue share in 2025, accounting for an estimated 35% market share, driven by extensive investments in national highways, port connectivity, industrial corridors, and logistics infrastructure. States such as Tamil Nadu, Karnataka, Telangana, Andhra Pradesh, and Kerala continue to witness strong road development to support manufacturing, exports, tourism, and urban mobility. The presence of major ports, industrial clusters, and IT hubs further sustains demand for road expansion and modernization across the region.

Why Is North India Expected to Register the Fastest Growth in the India Roads and Highways Market?

North India held the second-largest market share of approximately 28% in 2025 and is expected to register the fastest CAGR during the forecast period (2026–2031). The region's growth is supported by large-scale expressway development, industrial corridor projects, border road construction, and expanding logistics infrastructure across Delhi-NCR, Noida, Gurugram, Lucknow, Jaipur, Chandigarh, and Amritsar. Increasing government investments in multimodal connectivity and freight transportation are further accelerating regional market growth.

Why Did West India Hold a Significant Share of the India Roads and Highways Market?

West India accounted for an estimated 24% market share in 2025, driven by strong industrial activity, commercial development, and port-led infrastructure expansion across Mumbai, Pune, Ahmedabad, Surat, Nagpur, and Vadodara. Rising investments in logistics parks, dedicated freight corridors, manufacturing hubs, and smart city projects continue to support highway expansion, road upgrades, and connectivity improvements, strengthening the region's roads and highways market.

Why Is East India Emerging as a Promising Roads and Highways Market?

East India contributed an estimated 13% market share in 2025 and is expected to witness steady growth during the forecast period. Increasing investments in highway modernization, mining connectivity, industrial corridors, port infrastructure, and rural road development across Kolkata, Bhubaneswar, Ranchi, Patna, Guwahati, and Durgapur are driving regional demand. Improving connectivity under national infrastructure programs and growing economic activity are creating significant opportunities for road construction, expansion, and long-term maintenance projects across the region.

Key Market Players

• India Roads and Highways Market Companies
• Larsen & Toubro Limited (L&T Construction)
• NCC Limited (Nagarjuna Construction Company Limited)
• IRB Infrastructure Developers Limited
• Dilip Buildcon Limited
• Ashoka Buildcon Limited
• KNR Constructions Limited
• HG Infra Engineering Limited
• PNC Infratech Limited
• G R Infraprojects Limited
• Afcons Infrastructure Limited

Recent Developments

• In January 2025, Ashoka Buildcon received CCI approval for its strategic acquisition in Ashoka Concessions Limited (ACL) in partnership with Viva Highways. The transaction includes the acquisition of a 34% equity stake in ACL and strengthens Ashoka Buildcon's roads and highways operations and long-term toll road asset portfolio.
• In March 2025, Competition Commission of India (CCI) approved the acquisition of 11 road Special Purpose Vehicles (SPVs) owned by Ashoka Concessions Limited and Ashoka Buildcon Limited by Epic Concesiones 2 Private Limited. The transaction is expected to enhance operational efficiency and attract additional infrastructure investment into India's highways sector.
• In June 2025, Ashoka Buildcon secured Letters of Intent (LOIs) worth approximately INR 1,387 crore from the Maharashtra Motor Vehicles Department for implementing an Intelligent Traffic Management System (ITMS) project through its subsidiary Ashoka Purestudy Technologies Private Limited, supporting the modernization of road safety and smart highway infrastructure.
• In November 2025, IRB Infrastructure Trust won the NHAI Toll-Operate-Transfer (TOT-17) Bundle, securing concession rights for the Lucknow–Ayodhya–Gorakhpur (NH-27) and Lucknow–Varanasi (NH-731) highway corridors for an upfront payment of INR 9,270 crore. The project represents one of India's largest toll road monetization transactions and further expands IRB's national highways portfolio.

Report Scope:

By Road Type

• National/Interstate Highways
• State Highways
• Other

By Components

• Road
• Bridges/Tunnels/Culverts
• Marking & Signage
• Safety Equipment
• Traffic Management System
• Others

By Process

• Maintenance
• Expansion

By Region

• South India
• North India
• West India
• East India

Competitive Landscape

Company Profiles: Detailed analysis of the major companies presents in the India Roads and Highways Market.

Available Customizations:

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Company Information

Detailed analysis and profiling of additional market players (up to five).