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RESURGENT INDIA: Infrastructure Development for the Next Generation

  • Categories
    Yojana/Kurukshetra
  • Published
    7th Nov, 2019
  • The government has emphasized on creating world-class infrastructure for building a New India. It has undertaken various projects to improve the present conditions of infrastructure.
  • It has undertaken various projects such as Sagarmala project ( for accelerating port led development), the Bharatmala project ( to link from west to east), the Mumbai trans Harbour link project (for building the country's largest bridge),  Setu Bharatam project (making National highways free of Railway level crossing)  among others to improve the present condition of infrastructure.
  • It also connected various Villages through the construction of Roads providing significant relief to the rural masses.
  • The government has also provided impetus for his new layer connectivity increase safety measures in Railways and the development of smart cities for her bunny transformation. All this development efforts have paved the way for a better India with a strong economic base.

Pradhan Mantri Awas Yojana (PMAY)

The Government has launched a comprehensive mission "housing for all by 2022". It is implemented as a Centrally Sponsored Schemes(CSS).

Energy Infrastructure

  • The Government's ongoing energy sector policies intends to hit the following milestones: Make available 24*7 power to all by 2019;
  • Achieve 175 GW of renewable energy generation capacity by 2022; and Reduce imports of oil and gas by 10 per cent by 2022-23.
  • India is the world's third largest energy consumer. However, in 2017 its per capita energy consumption was about 6 kilogram of oil equivalent (kgoe) against the world average of 1860 kgoe.
  • The all-India installed power capacity is about 334 GW, including 62 GW of renewable energy. India imported approximately 82 per cent of crude oil and 45 per cent of natural gas requirements during 2017.

Some of the major challenges on achieving the milestones set for 2022-23 for energy sector  are:

 

  • Overall energy: A variety of subsidies and taxes distort the energy market and promote the use of inefficient/over efficient fuels and also make Indian exports and domestic production uncompetitive as energy taxes are not under GST, and hence, no input credit is given.
  • Power: The high industrial/commercial tariff and the cross-subsidy regime have affected the competitiveness of the industrial and commercial sectors.
  • Oil & Gas: Lack of market-driven gas prices for old fields disincentivises further production. Also the gas pipeline infrastructure is not adequate.
  • Coal: There is a tendency to expand open-cast mining and discourage underground operation even for better quality coal reserves.
  • Renewable energy: High energy costs result in reneging on old Power Purchase Agreements and erode their sanctity. This leads to uncertainly regarding power off-take and consequently endangers further investments.
  • Energy efficiency: Limited technical capabilities, high initial capital expenditure, limited market and other issue have affected efforts to achieve energy efficiency.

Future initiatives to be taken in this sector:

  • Power: All PPAs including those with state generation companies should be based on competitive bidding. For agriculture, an upfront subsidy per acre of land through DBT may be considered instead of providing separate subsidies for fertilizers, electricity, crop insurance etc.
  • Oil & Gas: It is important to provide for a common carrier and open access to gas pipelines and separate the development and regulatory functions of the PNGRB. In addition, providing for shared infrastructure for evacuation of oil and gas from small and scattered on-shore and offshore fields should be made possible.
  • Energy efficiency: Promote the mandatory use of LED and the replacement of old appliances. Focus the UJALA (Unnat Jyoti by Affordable LEDs for All) programme on lower-income households and small commercial establishments. Widen and deepen the Perform, Achieve and Trade (PAT) programme; make Energy Saving Certificate trading under the PAT scheme effective by ensuring strict penalties against defaulters. Promote the use of the public transport system.

Transport Sector

Roads

  • The road sector in India accounts for the largest share in the movement of both passengers and freight. Over the years, both accessibility and mobility have improved through construction of new roads and development of existing roads.

Challenges in Road Sector

  • Capacity: the existing length of the NH network is 1.22 lakh km, which is 2 per cent of the country's total road network.
  • Maintenance: regular preventive maintenance has to be an integral element of road investment.
  • Land acquisition: Existing land laws should be amended to complete infrastructure project at a fast pace.
  • Inter-agency co-ordination: Horizontal and vertical inter agency cooperation is needed for planed land use to ensure inter-modal connectivity and to connect well with other parts of the network to boost overall capacity.
  • Funding: Sources for road funding are principally commitments from gross budgetary outlays, though these may stem from earmarked revenue streams, taxes and cess, dedicated road funds, or special development programmes such as the Pradhan Mantri Gram Sadak Yojana(PMGSY).

 Initiatives to be taken in road infrastructure

  • Increase connectivity by expanding the road network
  • Improve road maintenance and safety by adopting a maintenance management system
  • Streamline land acquisition
  • Introduce vocational training courses on road construction in industrial training institutes and ensure stringent testing of driving skills before granting driving licences.
  • Increase emphasis on research and development (R&D) by earmarking 0.1 per cent of MORTH's annual budget for R&D, establish a transport data centre at the national level for applied research on roads etc.
  • Increase the capacity and reach of public transport: The Central Government will have to work with states to develop bus terminals and provide support on technologies/software such as VAHAN (for vehicle registration) and Saarthi (for driving licences).
  • Expand the reach of the electronic toll collection (ETC) system: Streamline the 'FASTag' charging system, and engage with stakeholders and concessionaries (for PPP toll plazas) to ensure that all toll plazas have the requisite infrastructure for Etc.

Railways Sector

Present state of Indian Railways Sector

  • The Indian railways (IR) is the third largest railway network in the world under a single management and is the fourth largest network in the world in terms of route km (67,368 km in FY17).
  • IR’s golden quadrilateral and its diagonals make up only 15 per cent of the total route of the railways but it transports 52 percent of passenger traffic and 58 per cent of total freight load.

For efficient transportation there is need to achieve the following objectives:

  • Augment the capacity of existing railway infrastructure.
  • Increase the speed of infrastructure creation from the present 7 km/day to 19 km/day by 2022-23.
  • Achieve “100 per cent” electrification of broad-gauge track by 2022-23 from the 40 per cent level in 2016-17.
  • Increase the average speed of freight and mail/express trains to 50 km/hr (from about 24 km/hr in 2016-17) and 80 km/hr (from about 60 km/hr), respectively.
  • Improve the safety of the railways, achieving zero fatalities.
  • Enhance services delivery, achieving 95 per cent on-time arrivals by 2022-23.
  • Increase the share of non-fare revenues in total revenues to 20 per cent.
  • Over-stretched infrastructure with 60 per cent plus routes being more than 100 per cent utilized, leading to a reduction in average speed of passenger and freight trains. Moreover, negligible non-fare revenues and high freight tariffs have led to a sub-optimal freight share.

Initiatives to be taken in Railways

  • Improve capacity utilization and timely completion of maintain and upgrade the existing network to ensure that supply keeps up with demand.
  • Ensure that the dedicated freight corridors (DFCs) earlier planned and the Mumbai-Ahmedabad High Speed Rail (MAHSR) are completed on schedule.
  • Opening up the ownership and operations of freight terminals and ownership of locomotives and rolling stock and consider transferring coach and locomotive manufacturing and repairs to the private sector under a transparent, neutral (non-railway) and fair regulatory mechanism.
  • Monetize land resources with the railways, particularly through developing non-railways, revenues such as through retail or other activities.
  • Focus must be on increasing the use of proven, advanced technologies such as automatic train protection, fog safety devices and on-board/online condition monitoring systems.

Civil Aviation Sector

  • India’s civil aviation sector has been growing steadily; the number of passengers was 158 million in 2016-17.
  • There has been an increase in air cargo, both domestically and internationally, in 2016-17. IATA has forecast that India will cross over into the top 10 air freight markets in 2018-19.
  • The World Economic Forum’s Global Competitiveness Report, 2018 ranks India as 53rd out of 140 countries worldwide in air transport infrastructure.

Objectives to be taken in civil Aviation Sector

  • Enhance the affordability of flying to enable domestic ticket sales from 75 million in 2016-17 to 300 million by 2022.
  • Double air cargo handled from about 3.3 million tons in 2017-18 to about 5 million tonnes.
  • Expand the maintenance, repair than overhaul (MRO) industry.
  • Expand airport capacity more than five times to handle one billion trips a year.
  • Enhance availability and affordability of regional air connectivity and revive/upgrade 56 unserved airports and 31 unreserved helipads through the regional connectivity scheme – Ude Desh Ka Aam Naagrik (RCS-UDAN).

Challenges faced by civil aviation Sector in India

  • Adequate hanger space and availability of land to expand airports at their current sites.
  • Lack of skilled workers aviation sector has decimated the probability of this sector. About 25 million persons will need to be skilled over the next 10 years.
  • The ministry of civil aviation has mandated that all airports move from a single to a hybrid till structure.
  • Aviation turbine fuel (ATF) is relatively expensive in India.
  • The number of aviation safety violations needs to be controlled.

Initiatives to be taken in civil aviation sector in India:

 

  • Enhance aviation infrastructure: Increase investment in the sector through financial and infrastructure support, Increase skilled manpower, promote collaboration between original equipment manufacturers (OEMs), industry and educational institutes.
  • Ease the regulatory environment for airports: adopt a consistent model for tariff determination so that it reduces passenger cost and align taxation and pricing structure to global benchmarks by considering bringing aviation turbine fuel (ATF) under the rubric of GST.

Ports & Shipping And Inland Water Transport (IWT)

  • India aims to double the share of freight transported by coastal shipping and inland waterways from 6 per cent in 2016-17 to 12 per cent by 2025.
  • It also aims to increase the port handling capacity to 2,500 million metric tonnes (MMT) by 2022-23.
  • Reduce the turnaround time at major ports from about 3.44 days (2016-17) to 1-2 days (global average) by 2022-23.
  • Augment the capacity of inland water transport by increasing the least available depth.

Ports and Shipping

  • Around 90 per cent of India's external trade by volume and 70 percent by value are handled by ports. Twelve major ports and 205 non-major ports operate on India's coast.
  • The Ministry Of Shipping's Sagarmala Programme focuses on modernizing and developing ports. It aims to reduce the logistics costs for foreign and domestic trade, leading to an overall cost savings of 35,000 to Rs. 40,000 crore annually by 2025.
  • It also aims to double the share of water transportation in the modal mix. The government has set up the Sagarmala Development Company Limited (SDCL) to undertake port-rail connectivity projects under Sagarmala.

Inland Waterways

  • IWT carries less than 2 per cent of India's organized freight traffic and negligible passenger traffic. Until 2015, there were only five National Waterways in the country.
  • In April 2016, 106 more waterways spread over 24 states were declared as NWs. The Ministry is augmenting the capacity of NW-I under the Jal Marg Vikas project.
  • A minimum draft depth of 18 meters is needed to enable mother vessels to dock at ports. It is difficult to attract capital for building inland vessels as it is a significant investment.
  • Dredging market to open up attracting more players particularly international players, in dredging activities.
  • Expedite the completion of various projects under Sagarmala. IWT should be integrated to multimodal/ intermodal connectivity.

Logistics

  • The contemporary definition of logistics involves the integration of information, transportation, inventory, warehousing, materials handling and packaging.
  • Logistics management includes the design and administration of system to control the flow of material, work-in-progress, and finished inventory to support business unit strategy.

Aims to be achieved in this sector

  • Achieve multi-modal movement of cargo on par with global logistics standards.
  • Reduce the logistics cost to less than 10 per cent of GDP from the current level of 14 per cent.
  • Improve logistics skilling and increase jobs in the sector to 40 million by 2022-23.

Challenges in this sector

  • Absence of last mile connectivity and infrastructure, competition and underutilized capacity, lack of interoperability of software systems used by the authorities governing different modes of transport leads to increase in transit time.

Initiatives to be taken this sector

Rationalize tariffs and determine prices in an efficient manner across different modes, create an overarching body that maintains a repository of all transport data to internal stake-holders and conduct robust analysis of the data, setting up multimodal logistics parks etc. will help address issues related to infrastructure development.

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