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Infrastructure in Developing Countries Draws Competition

Contractors and design firms working globally are coping with rising materials and labor prices in pursuit of work in some of the world’s fastest growing markets. China and India offer some of the biggest opportunities as their governments work to beef up inadequate infrastructure that threatens to impede their red-hot economies.

Over 350 industry professionals met in Beijing, China, on April 11-12, to discuss global business methods and markets at a forum cosponsored by McGraw-Hill Construction, of which ENR is a unit, and the China International Contractors Association. They heard calls for assuming social responsibility and advice on finding and maintaining local partnerships to win work.

Bill Van Wagenen, senior program manager for CH2M Hill Cos.’ program to consolidate U.S. military bases in Korea, said managers should set standards early in negotiations with local partners for what they want to achieve as a firm after a contract has been awarded, not just for how to win the job. He said there have been growing pains for the firm’s U.S. managers as they discover cultural differences between CH2M Hill and its four Korean partners.

“Culture often trumps best practices and even the contract,” he noted.

 In a session exploring India’s fast-growing construction market, P.R. Swarup, director general of India’s Construction Industry Development Council, said construction is the second-largest employment sector after agriculture. Speakers agreed infrastructure is the bottleneck in the Indian economy.

Govindan Sridharan, strategy advisor to GMR Infrastructure Ltd., developer of a $2.3-billion new terminal at Delhi International Airport, said the cost of labor is still cheap, but competition for skilled workers is intense. To keep workers on the Delhi airport job, Sridharan said contractors built a labor camp for 12,000 workers. “We provide food, shelter, security, shopping and movies,” he said. “Workers don’t have to commute for hours in the Delhi traffic. It’s paying off big time in retaining workers.”




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