Infrastructure

• Whichever sector be the prime moving force of an economy, i.e., primary, secondary or tertiary, suitable level of infrastructure presence is a pre-requisite for growth and development.
  • This is why the Government of India has always given priority to the developmental aspects of the sector
• But the level of preparedness and performance had been always less than required by the economy
• Indian infrastructure sector is clearly overstrained and has suffered from underinvestment in the post-reforms period
• Infrastructure bottlenecks are always constraint in achieving a higher growth for the economy.
  • Thus, India needs massive investment, both from the public and private sectors, to overcome infrastructure bottleneck
• In this perspective, Investments by the public and private sectors are not alternatives, but complimentary to each other as the required investment is very high

Indian Railway Infrastructure

• Indian Railways is among the world’s largest rail network, and its route network is spread over 67, 956km, and 13,169 passenger trains and 8,479 freight trains plying 23 million travellers and 3 million tonnes (MT) of freight daily from 7,349 stations
• India’s railway network is recognised as one of the largest railway systems in the world under single management
• Growth
  • Indian Railway network is growing at a healthy rate
  • In the next five years, Indian railway market will be the third largest, accounting for 10% of the global market
  • Indian Railways, which is one of the country’s biggest employers, can generate one million jobs
• Significance of the Indian Railways
  • Railways provide the cheapest and most convenient mode of passenger transport both for long distance and suburban traffic
  • Railways have played a significant role in the development and growth of Industries. Growth of textile Industry in Mumbai, Jute Industries around Kolkata are largely due to development of railway network in these areas
  • Agriculture also owes its growth to railways to a great extent. Now farmers can sell their agricultural produce to distant places
  • Railways have been helpful in removing isolation between cities and countryside; and have played a significant role in dissemination innovations and new ideas
  • Railways are particularly suited for long distance journey; and hence provide a strong medium of national integration
  • Railways carry relief and rescue teams to the affected areas, during times of natural calamities. Hence, they play a part in mitigating the sufferings of the people
  • Railways help in facing man-made calamities like social, political, religious disturbances, insurgency, etc. It facilitates easy movement of police, troops, defence equipment etc.

• Challenges to Railway Infrastructure in India
  • India’s railway system is saddled with a two-pronged infrastructure deficit –
    • ageing infrastructure, and
    • the pace of new project execution struck by unforeseen circumstances related to socio-economic issues on land acquisition for new projects and escalating project costs
  • India’s haphazard planning of development post-independence has further complicated the infrastructure upgrade
  • Gauge conversion and signal upgrades are the major obstacles to the strengthening of infrastructure
  • The absence of modern automated signalling across the network further adds to the complication of the matter.
• Major Initiatives to improve Railway Infrastructure in India
  • Mobile application for freight operations – Parichaalan – has been introduced
  • High Speed Train Project
    • In February 2016, the National High-Speed Rail Corporation Limited (NHSRCL) was incorporated with an object to finance, construct, maintain and manage all high speed rail corridors in India
    • The first route selected for implementing was the Mumbai – Ahmedabad route(with Japanese assistance through its Shinkansen (bullet train) technology), so NHSRCL was formed with equity participation by the Central Government through Ministry of Railways and the state governments of Gujarat and Maharashtra.
  • Train 18
    • India’s first engine-less, semi high-speed train (160 kmph), the Train18 (rechristened Vande Bharat Express) was launched in February 2019
  • In 2021, the Central Government approved a Rs. 25,000 crore (US$ 3.43 billion) five-year plan to use 4G technology to modernise communication networks in railway stations and improve the safety and security of train journeys
  • In 2021, Indian Railways completed the arch closure of the under-construction Chenab Bridge which is the world’s highest railway bridge. Chenab Bridge is 1315 m long and will be 35 meters higher than Eiffel Tower in Paris
  • Under the Union Budget 2021-22, the government allocated Rs. 110,054.64 crore (US$ 15.19 billion) to the Ministry of Railways.
  • In 2020, Indian Railways sanctioned a feasibility study for seven bullet train projects – all open to PPP investments
  • The Indian Railway launched the National Rail Plan, Vision 2024, to accelerate implementation of critical projects, such as multitrack congested routes, achieve 100% electrification, upgrade the speed to 160 kmph on Delhi-Howrah and Delhi-Mumbai routes, upgrade the speed to 130 kmph on all other golden quadrilateral-golden diagonal (GQ/GD) routes and eliminate all level crossings on the GQ/GD route, by 2024

• With about 59.64 lakh km of road network comprising National Highways, State Highways and other roads, India has the second largest road network in the world.
  • The NH in the country cover a total length of 1.32 lakh km and carry about 40% of the road traffic
• Growth
  • Highway construction in India increased at 17.00% CAGR between FY16-FY21
  • A total of 200,000 km of national highways is expected to be completed by 2022
  • In the next five years, National Highway Authority of India (NHAI) will be able to generate Rs. 1 lakh crore (US$ 14.30 billion) annually from toll and other sources

• Issues/Challenges related to Road Infrastructure in India
  • The development of the road network continues to be plagued by delays, with one recent parliamentary standing committee report suggesting that over 800 road projects for a cumulative of more than 27,000 km, under the Ministry of Road Transport and Highways(MoRTH), as being delayed
  • Also, MoRTH’s lacks any source of revenue other than budgetary support from the Central government and borrowings
  • Another constraint is the very limited private sector participation in development of new roads and highways.
    • This is driven by the financial profile of the developers, a lack of debt products that can be aligned to revenue models of highway projects as well as by delays in land acquisition, and an uncertain regulatory framework

• Major initiatives to improve Road Infrastructure in India
  • The Government of India has allocated Rs. 111 lakh crore (US$ 1.4 trillion) under the National Infrastructure Pipeline for FY 2019-25
  • Other major initiatives include:
    • Bharatmala programme to connect non-major ports
    • Setubhratam Pariyojana to construct about 1500 major bridges
    • District Head Quarter Connectivity Scheme for development of about 9000 km newly declared NHs
  • Pradhan Mantri Gram Sadak Yojna (PMGSY)
    • Launched to provide single all-weather road connectivity to eligible unconnected habitations having population of 500 persons and above in plain areas and 250 persons and above in hill states, tribal (Schedule V) areas, desert (as identified in the Desert Development Programme) areas, and LWE-affected districts as identified by the Ministry of Home Affairs
  • Special Accelerated Road Development Programme for North-East region (SARDP-NE) aims at improving road connectivity to state capitals, district headquarters, and remote places of the north-east region
    • While, Development of roads in Left Wing Extremism (LWE)-affected areas in the states of Andhra Pradesh, Bihar, Chhattisgarh, Jharkhand, Madhya Pradesh, Maharashtra, Odisha, and Uttar Pradesh is continuing
  • In 2020, the Ministry of Road Transport and Highways signed a memorandum of understanding (MoU) with the Federal Ministry of Climate Action, Environment, Energy, Mobility, Innovation and Technology of the Republic of Austria on technology cooperation in the road infrastructure sector.

• The civil aviation industry in India has emerged as one of the fastest growing industries in the country during the last three years.
  • India has become the third largest domestic aviation market in the world
• Growth
  • Rising working group and widening middle class demography is expected to boost demand
  • Also, India is expected to overtake UK to become the third largest air passenger* market by 2024
  • India is expected to overtake China and the United States as the world’s third-largest air passenger market in the next ten years, by 2030, according to the International Air Transport Association (IATA)

• Challenges faced by the aviation Industry in India
  • Shortage of trained employee
    • There is a shortage of trained and skilled manpower in the aviation sector because of which there is cut-throat competition for employees which, thereby is driving wages to unsustainable levels
  • Regional connectivity
    • Though there are a large number of airlines operating, still there exists lack regional connectivity
    • Providing regional connectivity is one of the greatest challenges for the Aviation sector in India. This is due to lack of airports and other associated infrastructure
  • Rising fuel prices
    • The jet fuel cost accounted for nearly 45% to 50% of the total costs in 2018; thereby presenting more operational challenges
  • Declining yields
    • Pricing and yield are the key elements for an airline to operate
    • Commercial liberalization has led to intense competition and reduction in real yields for Airline companies
  • Gaps in Infrastructure
    • Airport infrastructure and Air Traffic Control (ATC) foundation are insufficient to help development
    • While a beginning has been made to redesign the infrastructure, the outcomes will be visible after some years.
  • Technical Challenges
    • The maintenance, Repair, and Overhaul (MRO) industry is not well developed in India; to provide for cost-effective maintenance of Aircrafts
    • The lack of native Aircraft manufacturing base, results in more imports of Aircrafts, thereby making the operations more Capital Intensive
  • Major initiatives to improve Civil Aviation Infrastructure in India
    • The government has allowed 100% FDI under the automatic route in scheduled air transport service, regional air transport service and domestic scheduled passenger airline. However, FDI over 49% would require government approval
    • The Ministry of Civil Aviation (MoCA) is hopeful that aspiring commercial pilots will soon be able to get trained in India without having to leave the country.
      • In this regard, the government in July 2021 announced setting up eight new flying academies across the following five airports: Belagavi and Kalaburagi in Karnataka, Jalgaon in Maharashtra, Khajuraho in Madhya Pradesh, and Lilabari in Assam

Vision

• To create an ecosystem to make flying affordable for the masses and to enable 30 crore domestic ticketing by 2022 and 50 crore by 2027, and international ticketing to increase to 20 crore by 2027.
• Similarly, cargo volumes should increase to 10 million tonnes by 2027

Mission

• Provide safe, secure, affordable and sustainable air travel for passengers and air transportation of cargo with access to various parts of India and the world.

Objectives

• Establish an integrated eco-system which will lead to significant growth of civil aviation sector, which in turn would promote tourism, increase employment and lead to a balanced regional growth.
• Ensure safety, security and sustainability of aviation sector through the use of technology and effective monitoring.
• Enhance regional connectivity through fiscal support and infrastructure development.
• Enhance ease of doing business through deregulation, simplified procedures and e-governance.
• Promote the entire aviation sector chain in a harmonised manner covering cargo, MRO, general aviation, aerospace manufacturing and skill development

UDAN Scheme

• • The scheme is aimed at enhancing connectivity to remote and regional areas of the country and making air travel affordable
  • It is a key component of Centre’s National Civil Aviation Policy, launched in 2016
  • Under the scheme, nearly half of the seats in Udan flights are offered at subsidised fares, and the participating carriers are provided a certain amount of viability gap funding (VGF) –an amount shared between the Centre and the concerned states
• Aviation sector is one of the 25 sectors which has been identified under the Make in India scheme

• Power is among the most critical component of infrastructure, crucial for the economic growth and welfare of nations.
• The existence and development of adequate infrastructure is essential for sustained growth of the Indian economy.
• India’s power sector is one of the most diversified in the world.
  • Sources of power generation range from conventional sources such as coal, lignite, natural gas, oil, hydro and nuclear power to viable non-conventional sources such as wind, solar, and agricultural and domestic waste
• In 2018, India ranked fourth in the Asia Pacific region out of 25 nations on an index that measured their overall power
• Growth
  • Indian power sector is undergoing a significant change that has redefined the industry outlook.
    • Sustained economic growth continues to drive electricity demand in India.
    • The Government of India’s focus on attaining ‘Power for all’ has accelerated capacity addition in the country
  • By 2022, solar energy is estimated to contribute 114 GW, followed by 67 GW from wind power and 15 GW from biomass and hydropower.
    • The target for renewable energy has been increased to 227 GW by 2022.
• Issues related to power sector in India, include
  • shortage of fuel
  • high AT&C losses
  • differential tariff structure
  • delays in tariff revisions
• Also, over the years, the capacity to generate electricity has increased, however the actual generation of electricity has not been commensurate with this increased capacity. Key reasons for the low utilisation of generation capacity are:
  • shortage of fuel, especially coal
  • unviable Power Purchase Agreements
• Major initiatives to boost Power Infrastructure in India
  • Ministry of Petroleum and Natural Gas, Government of India owned GAIL lined up  Rs 5,000 crore (US$ 671.14 million) for setting up two plants each for producing ethanol and compressed biogas (CBG) from municipal waste
  • In 2021, the Ministry of Power (MoP) released the draft National Electricity Policy (NEP) 2021. The MoP has created an expert committee including members from state governments, the Ministry of New and Renewable Energy (MNRE), NITI Aayog and the Central Electricity Authority (CEA)
  • In 2020, Energy Efficiency Services Limited (EESL), a joint venture of PSUs under the Ministry of Power and Department of New & Renewable Energy (DNRE), Goa, signed a memorandum of understanding to discuss roll-out of India’s first Convergence Project in the state
  • In 2020, the government announced a plan to set up an inter-ministerial committee under NITI Aayog to forefront research and study on energy modelling
    • This, along with a steering committee, will serve the India Energy Modelling Forum (IEMF) jointly launched by NITI Aayog and the United States Agency for International Development (USAID)
  • The Government of India has allocated Rs. 111 lakh crore (US$ 1.4 trillion) under the National Infrastructure Pipeline for FY 2019-25. The energy sector is likely to account for 24% capital expenditure over FY 2019-25.
  • Pradhan Mantri Sahaj Bijli Har Ghar Yojana-Saubhagya was launched by Government of India with an aim to achieve universal household electrification by March 2019
  • Ujwal Discoms Assurance Yojana (UDAY) was launched by the Government to encourage operational and financial turnaround of State-owned Power Distribution Companies (DISCOMS) with an aim to reduce Aggregate Technical & Commercial (AT&C) losses to 15% by FY19.