Updated: March 8, 2011 13:11 IST

Progress in infrastructure

V. K. Natraj
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The book provides a good introduction to the problems faced in infrastructure development

This collection of papers discusses the contribution of infrastructure to economic growth and development under four broad heads: policy, infrastructure, governance and service delivery, and poverty alleviation. In addition, there are 11 case studies on different aspects of infrastructure development.

Behind virtually all the papers is a belief — sometimes explicitly stated and at others implied — in the primacy of technology or, to put it more generally, in the techno-centric approach. There is not much overt concern with the political economy issues in development. In spite of this limiting factor, the volume is useful in several ways. For a start, it provides a good introduction to the problems faced in infrastructure development, the policies of the state, and the progress made so far.


The first part of the book focusses on issues such as identity, planning for future cities, PURA (providing urban amenities for rural areas), and strategies for disinvestment and privatisation. Nandan Nilekani, who discusses identity, confines himself to the physical dimension. While this is no doubt important, the claims he makes for it are exaggerated, once again because the technical and procedural aspects get exclusive attention. For his part, P.V. Indiresan writing on PURA also misses the policy dimension. What he says about PURA is beyond controversy, except that making it happen will run into several knotty problems.

Vijay Kelkar's piece on disinvestment is interesting, especially since he draws attention to the different approaches to privatisation, such as strategic and open market sales, and discusses their relative merits. M. Ramachandran's paper on planning for future cities is descriptive, and rather tame.

PPP model

In the second part, Hari Sankaran examines the PPP (public-private partnership) model in infrastructure development and discusses the factors that inhibit its operation. He points out that, for all the emphasis placed on PPP, the quantum of private investment remains quite small. What is useful is his analysis of the alternatives available.

In their solid piece on market-based financing of infrastructure, Chetan Vaidya and Hitesh Vaidya evaluate the various models available, besides providing a wealth of data on the status of municipal bonds in different urban local bodies. S.S. Tarapore addresses some major questions relating to the financing of infrastructure and possible methods of resolving them. His analysis of the inflationary impact of certain methods of financing is sharp, except that he appears to subscribe to the conventional standard “inflation-avoidance fundamentalism.”

K.K. Pandey, who takes a hard look at fiscal decentralisation and urban infrastructure, brings out the disturbing fact that the expenditure of urban local bodies (ULBs) as a percentage of the GDP is declining. Quite appropriately, he refers to rich cities and poor governance.

A healthy corrective to the rural romanticism that often colours the views of some of our starry-eyed ‘thinkers' is found in Bibek Debroy's paper on urban India. One could not agree with him more than when he speaks of the “sentimental notion of a rural Arcadia,” which is generally articulated by people who have never lived in rural India. Debroy and one or two other contributors stress the obvious, but what is all-too-often forgotten is the fact that the city has made a great deal of positive difference to growth and development.

Urban poverty

The paper by N.C. Saxena is a good read. Emphasising that urban poverty cannot be captured only by income, he speaks tellingly of the anonymity of urban life and the absence of the safety nets as are available in rural society. He makes out a case for assigning equal weightage for ‘income' and ‘access to amenities' in estimating poverty. Some of the solutions he offers to problems related to housing and water supply are eminently worthy of debate. Nitin Desai points out how the much-talked about demographic dividend will work only in a context of urban development.

As always, in reviewing a collection of papers, some do not get a look-in due to space constraints like the ones dealing with financial inclusion and e-governance in this case. The volume would have been more exciting had the inquiry been situated in an overall political economy setting. A more tersely written introduction linking the contributions of individual papers would have helped.

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