Bikky Khosla | 07 Jan, 2020
The Centre made a big bang announcement last week. Making a brief statement on the contents of the National
Infrastructure Pipeline (NIP) at a press conference, the Union Finance Minister
said that the Modi government is committing Rs 102 lakh crore for the next 5
years. She added that another Rs 3 lakh crore worth of projects would be added
shortly. For an economy that is tottering, this is, no need to say, good
news. The program, tough sounds ambitious, is welcome.
A Task Force was constituted
to draw up the National Infrastructure Pipeline (NIP) for each of the years
from FY 2019-20 to FY 2024-25, and its first meeting was held in
September 2019. Subsequently several meetings were held with various
departments, ministries, corporates, banks, other financial institutions and
industry associations, etc. And now the government indicated that it would examine the recommendations of the Task Force
and take action early.
The report shows that about
42% of such identified projects are already under implementation, 19% are under
development and 31% are at the conceptual stage. It adds that during the fiscals 2020 to 2025, sectors such
as energy (24%), roads (19%), urban (16%), and railways (13%) amount to around
70% of the projected capital expenditure. Overall, Rs 1 lakh crore, Rs 19.63 lakh
crore, Rs 14 lakh crore and Rs 2.5 lakh crore would be spent respectively on port,
road, railways and airport projects. These figures look great.
But the task ahead is challenging. It has been informed that a Task Force
would meet various stakeholders over coming months to discuss how to actualise
the projects, but till now it is not even clear how the private-public working
framework shall function as part of NIP. Also, success would largely depend on
how effectively the government can address some lingering infrastructure
investment related issues like delays in land acquisition processes, enforcement
of contracts and delay in court-case resolutions, etc.
I invite your opinions.