Arabian Construction Company (ACC) has just won its sixth major construction contract in India four years after its entry into the market.
The contractor, which has its headquarters in Beirut and an office in Abu Dhabi, is the winner of a US$78.5 million contract to build phase one of the Supertech Hues project. The project is a cluster of luxury residential towers being built in the Gurgaon area of India’s National Capital Region, near New Delhi.
This follows a $125m contract ACC won from Supertech in nearby Noida, where it is building an 80-storey, 300-metre-high tower named Spira.
The tower is the centrepiece of a major project known as Supernova. It is also building three towers for developers in Mumbai and Noida, and one in Kolkata.
ACC entered India in 2011 when it won a contract from Lodha Developers to build the 117-storey, 442 metre-high World One Tower.
The tower is reportedly costing $320m to build and is due for completion next year, said Rachid Mikati, a director at ACC.
Despite winning the World One Tower project, a joint venture with the Indian contractor Simplex Infrastructures, ACC took its time to familiarise itself with India’s market before taking on any other work.
“India is a very different market for foreigners to work in. We thought: ‘let’s get to know the difficulties and how we can deal with them before we continue’,” said Mr Mikati.
ACC, which has a project office in India, is looking to diversify its work in the market, but it will focus on areas where specialist expertise is required.
“It’s not the easiest market, but as long as you can quantify your risks and you know what you are doing, you can make it work,” said Mr Mikati.
“Since the new government came into power, everybody is very bullish on India. There are a lot of business-friendly changes promised and we expect it to get better. We expect higher GDP growth will trickle down to the construction sector.”
In June, a BMI Research report predicted that India’s construction sector would grow 5 per cent in the 12 months to next March.
The report noted “structural weaknesses in India’s business environment, with issues such as land disputes affecting project execution”.
Beyond next year, BMI expects reforms introduced by India’s prime minister, Narendra Modi, to begin improving economic conditions, attracting more private sector investment into the country.
“Consequently, we forecast the construction sector to grow by an annual average of 6.4 per cent between 2016 and 2020,” it said.
ACC has built some of Abu Dhabi’s biggest projects in recent years, including Etihad Towers and the World Trade Centre. It is on site in Downtown Dubai at The Address Residence Sky View and The Address Residence Fountain Views for Emaar Properties. In Saudi Arabia, the company is working on the Emaar Square project in Jeddah and is in a joint venture with Drake & Scull to deliver the third phase of the Jabal Omar Development Project in Mecca.
mfahy@thenational.ae
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