100 days of NDA rule National

Infrastructure: Connecting the nation

Bullet trains and aviation and port projects aims to shrink India

Nothing conveys the idea of nation-building more as the grand images of infrastructure development — men and machine at work and trucks, ships and trains driving the country forward along highways, seas and rails; it represents a vision that is visible and tangible.

India’s first Prime Minister Jawaharlal Nehru, credited as the architect of modern India, conveyed the idea of a nation in the making through a scientific vision based on development of infrastructure — heavy industries, big dams and a vibrant public sector.

Prime Minister Narendra Modi, too, buoyed by the popular mandate the BJP received under his leadership, would settle for nothing less than being the architect of a new India that “unhesitatingly desires to grow” and nurtures the ambition of emerging as a global superpower.

Mr. Modi’s vision for the re-imagination of India is bejewelled with a Diamond Quadrilateral of bullet trains connecting the four metros; a Sagar Mala project connecting India’s coastal cities with the mainland; 100 new smart cities; and the revival of Atal Bihari Vajpayee’s ambitious river-linking project.

But while Nehru’s vision was driven by the public sector, Mr. Modi intends to fuel his massive infrastructure drive through foreign investment and public private partnerships, with half the $1 trillion required expected to come from the private sector.

With strict and regular monitoring of implementation of grand projects, Mr. Modi hopes to change popular perception of big-ticket projects that sound great on paper but lose steam when faced with ground-level bottlenecks during implementation.

Mr. Modi’s stance towards infrastructure was at play in his asking four core Ministries — Civil Aviation, Railways, Road and Shipping — to coordinate themselves and work together.

For Railways, the government announced 100 per cent FDI through the automatic route and hiked passenger fares to raise funds for boosting rail infrastructure. In July, Mr. Modi met top officials of nine infrastructure Ministries, wherein laying 300 km of new railway track and doubling of around 700 km, was proposed for the current fiscal.

Expansion of the Railways in hilly and north-eastern states, finding mention in President Pranab Mukherjee’s speech to Parliament in June, is also on Mr. Modi’s agenda.

In civil aviation, the government has revised the existing policy on regional air connectivity to expand the air map with 87 new cities slated to be connected through low-cost airports and airlines.

Another major boost to the sector would come if the government manages to convince the States to reduce taxes on aviation turbine fuel to 4 per cent from as much as 33 per cent. So far, West Bengal is the only State to have slashed tax on ATF by 50 per cent, while Andhra Pradesh has offered conditional reduction of VAT on ATF.

In a push to road infrastructure, Mr. Modi, chairing a meeting of the Cabinet Committee on Economic Affairs last week, empowered the Surface Transport Ministry to amend the Model Concession Agreement and to decide the mode of delivery of projects.

To remove supply-side bottlenecks in the power sector, the government is mulling a policy on coal-linkage swapping between State and Central power utilities.

In shipping, Mr. Modi plans to usher in port-led development through the Sagar Mala project which would include ports, special economic zones, and rail, road, air and waterway connectivity with the hinterland, including linkages of cold storage and warehousing facilities. His government also introduced lifetime validity of shipping licences.

Mr. Modi’s infrastructure vision also has a strategic dimension, manifest in Budget concessions on supply of natural gas to Pakistan through a GAIL (India)-built pipeline from Dahej in Gujarat to Lahore via Jalandhar and Amritsar.

But such grand expansion of infrastructure would require massive funding and it would be interesting to see how the government goes about that task.

To begin with, the government is working to set up a $4-5 billion dollar infrastructure fund, with Japanese and Korean participation, to finance infrastructure projects, besides hoping to raise Rs.58,425 crore through disinvestment.

The Prime Minister’s Jan Dhan Yojana, while based on the broader premises of financial inclusion, is expected to prove another vehicle to fund the grand infrastructure plans by boosting household savings.

In the Budget, Finance Minister Arun Jaitley set aside Rs. 7,060 crore for developing 100 smart cities, which will be developed as satellite towns of larger cities and by modernising existing mid-sized cities.

The first step towards this project was taken during Mr. Modi’s just-concluded visit to Japan, where he inked a MoU with Japan to assist in the transformation of his Lok Sabha constituency, Varanasi, into a smart heritage city on the lines of Kyoto.

Besides, Mr. Modi secured a commitment from Japanese Prime Minister Shinzo Abe to invest $33.6 billion in infrastructure projects in India over a period of five years.

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Printable version | Feb 21, 2020 6:29:59 AM | https://www.thehindu.com/news/national/infrastructure-connecting-the-nation/article6374337.ece

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