Empowering people mandates a multi-dimensional approach. While, focusing on attitudinal changes is of utmost importance, it is also necessary to ensure that there is sustained focus on creating conditions under which the ordinary masses can access the basic services. For instance, a poor person in a remote village will require good transportation facilities to access secondary/tertiary health care services in a nearby town. A woman specialising in handcrafts should be able to sell her products online with ease. Access to cold-chain networks will enable a farmer to sell his produce at a price that is profitable for him/her. All these require robust physical infrastructure. Therefore, it is not surprising that Prime Minister Narendra Modi in his Independence Day-2019 speech announced that 100 lakh crore rupees would be spent over the next five years to build modern infrastructure in India. The National Infrastructure Pipeline (NIP) was announced, and a Task Force was also constituted, which subsequently provided sector-wise break-up of the pipeline.1
In consonance with the NIP objectives, Finance Minister Smt Nirmala Sitharaman gave a strong push for the infrastructure sector in the Budget for the year 2020-2021. In her speech, the Finance Minister stated the government is keen on increasing the pace of building the highways and went on to add that these efforts will “include development of 2,500 Km access control highways, 9,000 Km of economic corridors, 2,000 Km of coastal and land port roads and 2,000 Km of strategic highways.2” The emphasis on coastal roads is also aimed at improving the linkages between industrial centres and the global markets. It is now well established that improvements in the transport sector will significantly reduce the cost of logistics and tends to make various products globally competitive.
Since 2017-18, the railway budget was presented as a part of the general Budget. The 2020-2021 Budget announced that there would be more Tejas type trains and the bullet train project between Mumbai and Ahmedabad would be pursued more vigorously. The focus on Tejas type trains is aimed at reducing the travel time for ordinary users of the railway networks. At a broader level, the 2020-2021 General Budget emphasised public-private-partnership (PPP) for improving the railway infrastructure. It was announced that approximately 150 new passenger trains and four station re-development projects would be operationalised under the PPP mode. Re-development of railway stations envisages using the revenues generated from the vacant land and other space for providing better amenities to the passengers.3 Further, there has been a general improvement in the provision of facilities at railway stations across India. According to the reports of the Indian Railways, “during the Year 2017-18, 189 stations were provided with water coolers, 152 stations were electrified and 161 passenger lifts and 126 escalators were provided at stations.4” The improvement of amenities at the stations has received considerable praise from the railway users.
The focus on improving internal institutional governance was evident in the approach towards port development as well. The Finance minister announced that at least one major port will be corporatised and will be listed in the stock exchanges. The attempts at corporatisation are aimed at ensuring more transparency and also ensure a faster decision-making process. On Inland Waterways it was announced in the Budget that the Dhubri-Sadiya Waterway on Brahmaputra River would be completed by 2022. If completed on schedule, the Dhubri-Sadiya Waterway will have a significant impact on the economy of Northeast India. In a related development, there are proposals to construct Dhubri-Phulbari Bridge which will connect Assam with Meghalaya. The Dhola–Sadiya Bridge, which connects Assam with Arunachal Pradesh is already operational at the Northern end of the Dhubri-Sadiya Waterway.
In a significant announcement, the 2020-2021 Union Budget promised to develop about 100 airports to support the UDAN (Ude Desh ka Aam Nagrik) scheme. The main objective of UDAN scheme is to stimulate the regional air connectivity by making it more accessible and affordable. The scheme has been successful since its launch in 2016. And its further expansion will undoubtedly have significant positive spillover impact in various districts of the country which are far away from big metropolitan cities. India has one of the fastest-growing domestic air travel market in the world, and in 2018 it registered a growth of 18.6%.5 Policies such as UDAN ensured that domestic air travel is more inclusive and not just a preserve of a few rich in big cities.
An exciting dimension of this year’s Budget is the intent to use existing infrastructure innovatively for the betterment of agriculture in general and farmers in particular. For instance, it was announced that Kisan Rail (refrigerated coaches in Express and Freight trains) would be used to transport the perishable commodities. Similarly, Krishi Udaan will also be used to transport commodities from remote and areas by air.
To operationalise many of the above mentioned projects, the financial allocation to the transport infrastructure sector was increased to 1,69,637 crores in 2020-2021 from 1,58,207 crores in 2019-2020(RE). Further, the Finance Minister added that to incentivise investments by Sovereign Wealth Fund of foreign governments, the government would “grant 100% tax exemption to their interest, dividend and capital gains income in respect of investment made in infrastructure and other notified sectors before 31st March 2024 and with a minimum lock-in period of 3 years.6” Given the slowdown in the economic growth, public and private investments in infrastructure will spur economic growth.
The operationalisation of these projects will have to surmount numerous challenges, such as adequate provisioning of land and greater coordination with the state governments. To meet these challenges, the Union Budget proposed an ‘Investment Clearance Cell to provide information on land banks and also extend support in terms of clearances.7’ The state governments must also nudge local governments and other agencies to facilitate smooth implementation of the various infrastructure projects. The private sector investment in the infrastructure will be contingent on predictability and continuity of the policies at the state level.
There is now a concerted effort to connect grassroots institutions such as Gram Panchayats, schools and healthcare centres with fibre-optic networks. The growth of digital networks will empower many at the margins to communicate, demand better services, formalise economic interactions and will spur aspiration for a better quality of life. The ease of living and social mobility of over a billion people to a considerable extent will be dependent on the success of the infrastructure projects. Therefore, it becomes imperative that infrastructure projects are quickly operationalised.
(The author is a Senior Fellow at the Nehru Memorial Museum and Library, New Delhi. The views expressed here are personal.)