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The infrastructure sector in India is ranked tenth in the world for the overall quality of the country’s infrastructure environment, according to data provided by the India Brands Foundation (IBEF).
India aims to become a five trillion dollar economy by 2025, making infrastructure development a key factor for overall growth.
The Central Government has launched the National Infrastructure Pipeline (NIP) in conjunction with other initiatives such as Make in India and the Manufacturing Linked Incentives (PLI) scheme to boost the development of the infrastructure sector.
It is significant that over 80 percent of infrastructure spending in the country went to financing transport, electricity, water and irrigation systems.
To strengthen bilateral relations, India established a new quadrilateral economic forum with the US, Israel and the UAE in November 2021 to promote infrastructure development projects.
The ‘Infrastructure for Resilient Island States’ initiative was launched to promote infrastructure development projects for the betterment of other vulnerable countries in the world.
Also, major infrastructure investments have been made, for example Reliance’s $1 billion digital fiber infrastructure investment has boosted overall private or venture capital investment in India
Furthermore, in October 2021, Prime Minister Narendra Modi announced a Rs 100 lakh master plan to build multi-modal connectivity with the aim of achieving developed infrastructure with lower logistics costs and to boost the economy.
Here are some of the recent government initiatives making headlines in 2022-
1. To improve the country’s infrastructure sector, Prime Minister Modi’s government has allocated 10 million crores ($130.57 billion).
These include a budget of Rs 134,015 crore (US$ 17.24 billion) for the National Highways Authority of India (NHAI), an outlay of Rs 60,000 crore (US$ 7.72 billion) for the Ministry of Road Transport and Highways, Rs 76,549 crore (US$). 9.85 billion) to the Ministry of Housing and Urban Affairs, among others.
2. The rail-road bridge over the Brahmaputra river has been approved by the government at a cost of Rs 996.75 million (US$ 122.27 million) under NHAI and the Ministry of Railways. In August, Road Transport and Highways Minister Nitin Gadkari laid the foundation stone for six NH projects worth Rs 2,300 crore ($287.89 million) in Indore, Madhya Pradesh.
3. In the period from April 2000 to June 2022, FDI in the sectors of construction development (urban municipalities, housing, built infrastructure and construction development projects) and construction (infrastructure) activities amounted to $26.22 billion and $28.64 billion, respectively. respectively.
4. By September 2022, the combined index of eight core industries, including coal, refined products, fertilizers, steel, power and cement, stood at Rs 142.8 crore. Growth in the country’s infrastructure output mostly slowed to 0.1 percent year-on-year (y/y) in October 2022 from a revised downwards of 7.8 percent in the previous month.
5. In September this year, the Modi government launched the Mega Investment Textiles Parks (MITRA) scheme to establish world-class infrastructure in the textile sector and set up seven textile parks over the next three years.
6. The government further expanded the ‘National Infrastructure Pipeline (NIP)’ to 9,335 projects. About 217 projects worth 1.10 million kroner (15.09 billion USD) have been completed by 2020.
7. In FY2022, the government has rolled out initiatives such as the National Infrastructure Pipeline, National Monetization Pipeline, Bharatmala Pariyojana, changes in the Hybrid Annuity Model (HAM) and fast-track allocation of asset monetization to boost road construction activities in the country.
8. In rural areas, under the Ministry of New and Renewable Energy to encourage rooftop solar (RTS) across the country, the government is undertaking Phase II Rooftop Solar Program with the intention of installing 4,000 MW of RTS capacity in the residential sector by 2022 with provision of subsidies .
Meanwhile, India will need to invest $840 billion over the next 15 years — or an average of $55 billion a year — in urban infrastructure to meet the needs of its rapidly growing urban population, a new World Bank report estimates.
The report titled “Financing India’s Urban Infrastructure Needs: Limits to Commercial Financing and Prospects for Policy Action” highlights the urgent need to scale up private and commercial investment to meet emerging financing gaps.
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