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Building Infrastructure for Building a New India

The Narendra Modi government has been more than active on creating critical infrastructure for India, something acknowledged by the world. In its endeavour to modernize India’s infrastructure, increase industrialization and giving a thrust to mega-scale job creation, Narendra Modi’s first term had become synonymous with its massive push on rail, waterways, roads and air traffic infrastructure. Additionally, the thrust on creating a cleaner power generation mix in line with India’s climate commitments combine with the other activities to show the importance the government has given to infrastructure. In his second term, Prime Minister Modi’s government has gone beyond retaining its push on the space, as the Rs. 100 lakh crore National Infrastructure Pipeline’s intentions clearly spell out, to enable ease of living in India.

Railways – Creating a New Thrust Area for Growth

Under NaMo 2.0, the first year has seen several remarkable achievements made by Railways. With passenger fatalities having been brought down to zero in 2019, the government has renewed people’s faith in the performance of the Railways. Further, trains are now more punctual, shedding the baggage of being late they carried in recent times. To achieve this, continued investments are being made in modernizing technology, high powered locos, modern coaches, signaling, electrification and better tracks. Dedicated corridors of New Delhi-Mumbai (including Vadodara-Ahmedabad) and New Delhi-Howrah (including Kanpur-Lucknow) have been identified at a project cost of over ₹13,000 crore cumulatively along with the remaining Golden Quadrilateral and Diagonals routes. Combined with a massive effort to modernize signaling systems that has seen 96% of total stations getting equipped with modern Signalling System, this goes a long way in reducing break time and preventing delays. Moreover, the Ministry of Railways has set itself an ambitious target of electrifying the balance 28,810 km Broad Gauge (BG) Routes by December 2023.

Passenger comfort is critical to achieving the ideal of Ease of living as envisaged by PM Modi’s government. In that regard, the Railways has literally unleashed a revolution. Transparency and streamlining of ticketing facilities, and amenities at stations like increased number of lifts, escalators, toilets across stations are some measures bringing great comfort to commuters. Further, special emphasis is being given to improve cleanliness and hygiene on stations and in trains with discharge-less Bio-Toilets in coaches, and premium train services like Humsafar, Tejas and Antyodaya with improved passenger amenities, have been introduced in service.

While the Bullet Train project remains on track, the government has also been working to make railways work in the commercial space too. Dedicated Freight Corridor (DFC) is on track to be fully commissioned in phases by December 2021, as the Rewari-Madar section of Western DFC and Bhadan-Khurja section of Eastern DFC have been completed with trials going on, even as the feasibility of new DFCs is being explored. With respect to the freight traffic, Railways remains committed, with a slew of measures including discount on loading of bagged consignment in open and flat wagons, rationalisation of freight rate, de-notification of large number of commodities for charging at FAK rates among others being announced.

Highways Retaining Their Status as Engines of Growth

Highway development continues to remain a feather in the cap of the Modi government. In 2019-20, the National Highway Authority of India (NHAI) accomplished construction of 3,979 km of national highways, the highest ever highway construction achieved in a financial year by NHAI. This is a trend over the years, given how 3,380 Km of highways were constructed in FY 2018-19. One must however also realize that with the effective deployment of Public Private Partnership (PPP) mode to develop highways and a conducive business environment, development has been happening at breakneck speed. By December 2019 alone, more than 5,000 km of national highways had been constructed across India, and one can anticipate by that March 2019, it would have caught up with the previous financial year (2018-19) numbers with ease.

 

Source: Ministry of Road Transport & Highways

Further, under the first phase of Bharatmala Pariyojana, implementation of 34,800 km of national highways in 5 years with an outlay of more than ₹5 lakh crore has already been approved, with NHAI mandating the development of about 27,500 km of national highways under this program. With deployment of innovative financial tools like Infrastructure Investment Trusts (InvIT) by NHAI, asset monetization under Toll Operate Transfer (TOT) mode and for raising finance against toll receipts and the incorporation of technology in the form of FASTags for collecting tolls, the cash registers have been set ringing, with daily toll collections significantly increasing through the resultant leakage reduction.

The importance of Highway development and its evolution can be seen by the fact that in the Budget 2020, the government has committed itself to taking the next logical step, entailing the development of 2,500 Km access control highways, building 9,000 Km of economic corridors along with highways, and taking up 2,000 Km of coastal and land port roads and another 2,000 Km of strategic highways as key projects for the year. A 2023 completion target for Delhi-Mumbai Expressway and the commencement of the much-needed Chennai-Bengaluru Expressway have been put forth as well.

Revival of India’s Waterways and Ports for Trade and Transport

Waterways were historically considered important means of transport within India, with old stories like Madhu Sadhukhan documenting how traders used to move around in large trading boats for inland business. The Modi government took upon itself post 2014 to harness once again the power of inland waterways. Post the declaration of 111 National Waterways in India in 2016, work has been moving rapidly to build upon it. The National Waterways by the Inland Waterways Authority of India (IWAI) has undertaken several projects to develop facilities like Roll-on Roll-off (RoRo) ghubs, and the results have started to come along. Cargo volume of 72.31 million tonnes per annum is being transported on NW1, 2, 3, 10, 68, 73 and 91 among others, even as implementation of projects like the Jal Marg Vikas Project (JMVP) at an estimated cost of ₹5,369.18 crore for capacity augmentation of navigation on National Waterway-1 (NW-1) on the Haldia – Varanasi stretch of Ganga-Bhagirathi-Hooghly River System is ongoing. Further, feasibility studies have been completed for 106 new NWs and based on the outcome of feasibility studies and Detailed Project Reports (DPRs), 20 new NWs have been found technically feasible for development of shipping and navigation in addition to 5 existing NWs by the IWAI.

With similar historic backdrop to India’s ports and harbours and its long history of trade, the government continues to strive towards pushing for the sector’s development. process. Cargo handling capacity of major ports increased from 800.52 MTPA in 2014 to 1,514.09 MTPA in 2019, while that of non-major ports increased from 599.47 MTPA in 2014 to 863.50 MTPA in 2019. Moreover, the 160 port infrastructure projects with a capacity of 442.08 MTPA and total investment of Rs. 39,186 crore awarded in Major Ports are at various stages of development. Also, 73.64 million tones (MT) of cargo moved on National Waterways during 2019-20, registering growth of 2% over previous year (2018-19).

Moreover, India has improved its ranking under the Trading Across Border (TAB) parameter of Ease of Doing business (EoDB) from 80 to 68, a result of measures like Direct Port Delivery (DPD) and Direct Port Entry (DPE), introduction of RFID, installing scanners and simplification of procedures among others taken by the major ports. Additionally, the issue of settling long pending subsidy claims for executed shipbuilding contracts under the shipbuilding subsidy scheme, 2002-2007 was approved under NaMo 2.0, which involves releasing Rs. 153 crore of committed liability of shipbuilding subsidy for 51 vessels, thus assuring full support to businesses in the sector.

Reaching the Skies, Enbaling UDAN

With land and water already in the picture, how can aviation be far behind? The continued thrust of the government in developing and increasing utilization of underserved airports has helped open up several new routes. The UDAN scheme has helped to open up several new airports, and new air links that serve remote regions have also turned up. To date, 48 airports have been operationalized under the UDAN Regional Connectivity scheme, while 266 new air routes have commenced under its various rounds. The thrust continues through UDAN 4.0, the latest round of bids under the scheme. 100 new routes have been identified under the scheme on which air traffic is being aggressively pursued, and detailed attention is being paid to connect remote areas like the North-East and airports around tribal belts. With its Viability Gap Funding (VGF) approach, care is also taken of the airline operators so that they do not feel shortchanged at any time.

Realizing the power of infrastructure development for India’s benefit continues to remain the hallmark of NaMo 2.0. The government’s continued thrust on road, rail, waterways, ports and aviation are impressive, and are converging fast to create new avenues of growth, job and wealth creation for the country while promoting ease of business and ease of living for all. This initial year of the second term has been marked by a constant gaze on the goal and the continued efforts to striving towards it, and both the commitment and will remain in place to achieving the dream of world class infrastructure in India.

May 28, 2020