The massive infrastructure development drive currently in progress is expected to support the country to maintain a high and sustainable growth in the medium and long term. Timely development of economic infrastructure will help to increase economic efficiency while expanding the production capacity of the economy, facilitate productivity enhancement and reduction of regional disparity. In 2012, the economic infrastructure development programme of the government focused on all areas of infrastructure; development of roads, water supply and sanitation, ports and aviation, transport, housing and urban development, establishment of industrial zones, hospitals and warehousing and logistic centres etc.
Sustaining the high growth momentum recorded during the past year, the construction sub sector recorded an impressive growth of 21.6 per cent compared to 14.2 per cent in 2011. This is the highest growth registered by the sub sector in the past ten years. The sub sector contributed to 8.1 per cent of the overall GDP and 23.9 per cent of the change in GDP growth from 2011 to 2012 becoming the growth driving sub sector in the Industry sector.
The private sector contributed towards the growth in the sub sector particularly with hotel and housing construction activities. The growth in the construction is reflected through the increase in imports of investment goods and building materials by 21.7 per cent and 13.5 per cent in volume terms in 2012. Furthermore, loans and advances by the Commercial Banks to the private sector for constructions activities grew by 22.9 per cent in 2012, compared to 14.5 per cent in 2011. As per the price index complied by the Institute of Construction Training and Development (ICTAD), the cost of construction activities had increased by 12.2 per cent during the year compared to the increase of 5.4 per cent in 2011.
The construction sector expanded with the acceleration of the ongoing road development projects such as expressways, inter-regional national highways and mega construction projects and urban development projects together with construction of houses and reconstruction work done in newly liberated areas boosted construction activities in the country.