Larsen & Toubro (L&T) and Afcons Infrastructure, India's top engineering and construction firms, are emerging as major players in West Asia's infrastructure boom, securing billion-dollar contracts as project awards in the Gulf Cooperation Council (GCC) region surge to $235 billion in 2024—more than doubling the annual average from 2015 to 2022, according to a report by UK brokerage firm Investec.
Key Highlights
- Indian engineering giant L&T strengthens its global footprint with key projects in West Asia's development drive.
- Afcons emerges as a prominent player in West Asia, contributing to the region's ambitious infrastructure growth.
L&T's expanding international footprint
L&T's international business is now heavily focused in West Asia. In FY25, overseas order inflows are expected to exceed ₹2 trillion, up from ₹900 billion in FY23. Orders from Saudi Arabia and the UAE alone accounted for more than 60% of FY25's international orders.
L&T has progressed from subcontractor to long-term agreement (LTA) contractor for Saudi Aramco, gaining access to large offshore oil and gas projects. It has also won contracts for power transmission, infrastructure, and hydrocarbons, increasing its GCC market share in hydrocarbons to around 10% and infrastructure to more than 8% by FY25.
The company's order pipeline is expected to reach ₹19 trillion in FY26, with hydrocarbons accounting for roughly two-thirds of that total.
Afcons bids for Dubai's $22 billion sewerage project
Afcons Infrastructure's bid for the $22 billion Dubai Sewerage Project represents a strategic leap. The project entails the construction of 75 kilometers of deep tunnels, 220 kilometers of link sewers, and two major treatment plants.
If secured, Afcons' share could be worth $2.5-3 billion, roughly matching its current annual order intake.
Regional shifts benefit Indian players
South Korean firms are scaling back due to previous margin losses, while Chinese contractors are spread thin across smaller packages, according to the Investec report. Saipem, the Italian giant, currently holds the majority of ongoing contracts, but L&T is the most active Indian player.
Over 50 Chinese firms have won orders in the region, but none are in the top five individually.
Oil revenue drives state spending
Rising oil revenues continue to be the primary driver of state spending in West Asia. Over $235 billion of projects are currently being bid on, with major upcoming projects including:
- Dubai Airport Expansion ($35 Billion): Infrastructure and Transportation Links
- Riyadh Airport ($20-30 billion): Development Tenders in Phases
- Rail and Metro Projects: Active tenders in the UAE, Saudi Arabia, and Kuwait
- Power generation: Renewable and conventional energy, with over 20 GW of capacity under planning or bidding
L&T continues to focus on transportation and energy projects, whereas Afcons is expanding into urban and tunnel infrastructure. Other Indian firms, including G R Infraprojects, KNR Constructions, and H.G. Infra, are also looking into the region through pre-qualifications and potential joint ventures.
