SME Times News Bureau | 31 Jan, 2020
The Economic Survey 2019-20 tabled in Parliament
on Friday emphasized that investment in infrastructure is necessary for
growth.
Power shortages, inadequate transport and poor
connectivity affects overall growth performance. Since provision of
adequate infrastructure is essential for inclusive growth, India recently
launched the National Infrastructure Pipeline (NIP) for the period FY
2020-2025.
To achieve GDP of USD 5 trillion by 2024 – 2025,
India needs to spend about USD 1.4 trillion (Rs.100 lakh crore) over these
years on infrastructure so that lack of infrastructure does not become a
constraint to the growth of Indian economy.
NIP is expected to enable well prepared
infrastructure projects that will create jobs, improve ease of living and
provide equitable access for infrastructure for all thereby making growth more
inclusive, the Survey observes.
As per the NIP, Central Government (39 per cent)
and State Government (39 per cent ) are expected to have equal share of funding
of the projects followed by the private sector (22 per cent). Projects
worth Rs.42.7 lakh crore (42 per cent) are under implementation.
Financing of the National Infrastructure Pipeline
will be a challenge but the Survey hoped that a bouquet of well prepared project
will attract from Central and State Government, urban local government, banks
and financial institutions, PE funds and private investors, both local and
foreign.
The Economic Survey gave an overview of sectoral
developments relating to Railways, Road Transport, Civil Aviation, Shipping,
Telecom, Petroleum and Natural Gas, Power, Mining, Housing and Urban
Infrastructure.
The Economic Survey noted that, road transport is
the dominant mode of transportation in terms of its contribution to Gross Value
Added (GVA).
In 2017-2018 the share of transport sector in the
GVA was about 4.77 per cent of which the share of road transport is 3.06 per
cent followed by Railways (0.75 per cent), air transport (0.15 per cent) and
water transport (0.06 per cent).
Total investment in the roads and highways sector
has gone up more than 3 times in five year period of 2014-15 to 2018-19.
The Survey marked that during
the year 2018-19 Indian Railways carried 120 crore tones of freight and 840 crore
passenger making it the world’s largest passenger carrier and fourth largest
freight carrier.
Taking a comprehensive view of Civil Aviation the
Survey observed that India has 136 commercially managed
airports by Airport Authority of India and 6 under Public Private Partnerships
for operation, maintenance and development of airports.
A total 43 airports have been opeartionalized
since the scheme for operationalizing unserved airports (UDAN) was taken
up. India stood first along with 7 other countries in airport
connectivity according to the Global Competitiveness Report 2019 of World
Economic Forum.
To ease the strain on existing airport capacities
100 more airports are to be made operational by FY 2023-24. The Survey
noted that to continue with the high growth trajectory the Government has been
providing a congenial environment so that Indian carrier double their fleet
from about 680 aircraft at the close of 2019 to 1200 by FY 2023-24.
Talking about the strides in the Shipping sector,
the Economic Survey stated that around 95 per cent of India’s trade by volume
and 68 per cent in terms of value is transported by sea. As on 30th
September 2019 India had a fleet strength of 1,419 ships.
The major ports in the country have an installed
capacity of 1514.09 MTPA as on March 2019 and handled traffic of 699.09 MT
during 2018-19.
The Survey said that the Ministry of Shipping is
striving to improve operational efficiencies through mechanization,
digitization and process simplification. The average turnaround
time in 2018 improved to 59.51 hours as against 64.43 hours in 2017-18.`
Taking a view of the Telecom Sector the Economic
Survey noted that there are four major players in the telecom
sector in India today - three in the private sector and BSNL and MTNL in
the public sector.
The Survey highlighted that since the price the
price of data in India is among the lowest in the world it will help to achieve
the goal of developing broad-band highways as part of the digital India
campaign.
The Government is implementing the Bharat Net
programme in a phased manner for providing Broadband connectivity to all the
2.5 lakh Gram Panchayats in the country.
The Economic Survey observed that India is the 3rd
largest energy consumer in the world after USA and China. India’s energy
requirement is fulfilled primarily by coal, crude oil, renewable energy and
natural gas.
With major reforms undertaken by Ministry of
Petroleum and Natural Gas in exploration and licensing policy to enhance
exploration activities, attract domestic and foreign investment and accelerate
domestic production of oil and gas from existing fields there has been a surge
of reserves of crude oil in 2019.
The Survey said that India has a refining
capacity of 249.4 MMTPA and is the fourth largest in the world after the United
States, china and Russia.
There is a need to augment refining capacity to
meet the growing demand for petroleum fuels and petrochemicals.
The Survey felt that in order to encourage the
participation of private entities in oil and natural gas sector government has
undertaken several reform measures which includes simplified fiscal and
contractual terms, bidding of exploration blocks under Category -2 and 3
sedimentary basins without any production or revenue sharing to government,
early monetization of discoveries by extending fiscal incentives, incentivizing
gas production including marketing and pricing freedom, induction of latest
technology and capital, more functional freedom to national oil companies for
collaboration and private sector participation for production enhancement
methods in nomination fields.
The Economic Survey also noted that the constant
efforts of the Government to foster investments in the power sector has
resulted in India improving its ranking to 76 position in Energy Transition
Index by the World Economic Forum.
Also, universal electrification progress has been
made in generation and transmission of electricity. The installed
capacity has increased from 3,56,100 MW in March 2019 to 3,64,960 MW as on 31st
October 2019.
The Survey underlined that access to electricity
is necessary for making growth inclusive and for promoting ease of
living. Pradhan Mantri Sahaj Bijli Har Ghar Yojana (SAUBHAGYA) was
launched on September 25, 2017 with an outlay of Rs.16,320 crores to achieve
universal household electrification by providing last mile connectivity by
31-03-2019.
The Survey observed that except for few
households in Left Wing Extremism affected Bastar Region of Chhattisgarh all
the states have reported electrification of all households on the SAUBHAGYA
portal.
The Economic Survey stated that India produces 95
minerals which include four hydrocarbon energy minerals, five atomic minerals,
ten metallic, 21 non-metallic and 55 minor minerals.
Mining and quarrying sector contributes about
2.38 per cent to GVA during 2018-19. On a positive note the Survey stated that
there has been a notable turn around in mineral production because of policy
reforms and production of major minerals during the year 2018-19 has recorded a
growth of 25 per cent when compared to last year in terms of value.
While giving a overview of the construction
sector the Survey said that it accounts for 8.24 per cent of GDP which includes
housing and employs about 12 per cent of the work force. The Pradhan
Mantri Awaas Yojana –Urban (PMAY-U) was launched in June 2015.
The Survey said that it is one of the largest
housing schemes of the world covering entire urban India and is being
implemented through four verticals. The scheme is moving towards achieving
the vision of pucca house to every household by 2020. Thirtytwo lakh
houses have been completed and delivered.
Since the Survey noted since the launch of the
Smart City Mission in 100 cities 5,151 projects worth more than Rs.2 lakh crore
are at various stages of implementation. A total of 1,290 projects worth
Rs.22,569 crores have been completed and are operational.