Despite short-term challenges in certain construction sectors, Bangladesh’s construction industry is well poised for significant growth. The industry is expected to witness consistent growth in the next four quarters. The annual compound growth rate could be 9.2 percent by 2024-28. Where the income of this sector is expected to reach Tk 6.50 trillion (Tk 6 lakh 50 thousand crores) by 2028.
Such a picture has emerged in the recent study of the international research organization Research and Markets. According to the research report, the income of the construction industry in Bangladesh is expected to increase by 10.4 percent and reach Tk 4.58 trillion (Tk 4 lakh 58 thousand crores) this year.
This picture is provided by analysis of growth dynamics in building and infrastructure construction, analysis of construction cost structure and more than 100 performance data (KPI) related to urbanization in major cities of Bangladesh.
The research report states that the available data and the continuity of growth indicate strong growth potential in the country’s residential, commercial, institutional, industrial and infrastructure sectors.
Government support, urbanization and foreign investment demand are the main drivers of this industry. As a result, researchers feel that the industry is well-positioned to face the challenges ahead and seize the opportunities.
Government initiatives, urbanization and a growing economy are contributing to the growth of this industry. Mainly because of these reasons, the construction industry of Bangladesh is on the path of growth.
As a catalyst, the government’s emphasis on infrastructure construction, especially in the transport and power sectors, is one of the catalysts for economic growth. To meet the expected power demand of 40 GW by 2030, an investment of $70 billion in power infrastructure will be required by 2035. This huge investment will contribute greatly to the growth of the construction industry.
Apart from this, the increase in demand for residential and commercial buildings due to rapid urbanization is also playing a role here. Now more people are moving to urban areas. This trend is expected to continue. The need for improved construction facilities and infrastructure will increase day by day.
Besides, significant government allocations for the Annual Development Program (ADP) in FY 2022, i.e. Tk 225,324 crore or $26.28 billion, have reflected the government’s interest in the infrastructure sector in large projects like Padma Bridge and Rooppur Nuclear Power Plant.
The housing construction sector was the largest contributor to the construction sector in 2023. The sector is witnessing rapid growth due to rising per capita income and rising demand for housing. In addition, due to population growth in cities, the government is seen focusing on affordable housing projects to meet the housing demand. Which will support the growth of this sector in the coming years.
Along with affordable housing, investment in luxury infrastructure is also on the rise. The demand for luxury apartments is increasing, especially in the heart of the city and the trend of building such infrastructure is diversifying the construction industry.
The commercial construction sector is also expected to grow due to the importance in tourism and investment in office and small commercial infrastructure. Opportunities are also emerging in leisure and hospitality projects, with the government committed to gradually easing travel restrictions.
Public-Private Partnerships (PPPs) are also helping to develop commercial construction, office buildings and logistics facilities.
Institutional building is gaining momentum with increased public and private sector investment in education and health care facilities. Greater commitment to innovation and development, particularly in the science and technology sector, will contribute to driving the construction industry forward.
Moving forward with the previous government’s plan to create 100 Special Economic Zones by 2030, especially the manufacturing and processing hubs, will make a significant contribution to the construction industry. Along with this, increased investment in the garment industry, the main export sector of Bangladesh, will further strengthen the construction industry.
There is still huge investment potential in communication infrastructure. Apart from the Padma Bridge and Rooppur Nuclear Power Plant, there is immense scope for investment in the transport and power plant construction sectors. Increased investment in rail and road infrastructure will improve connectivity and boost economic activity.
Environmental issues are also gaining importance in this sector. In particular, there is increasing interest in the construction of environmentally friendly buildings. This is now called sustainable construction. The research report mentions that this practice can shape the future of Bangladesh’s infrastructure development.
