A task force headed by the country’s Economic Affairs Secretary Atanu Chakraborty has observed that creating new and upgrading existing infra projects with investments amounting to Rs 111 lakh crore over the next five years will be key to driving India’s economic growth and becoming a $5 trillion economy by FY 2025.
These projects will be implemented under the National Infrastructure Pipeline (NIP), a first-of-its-kind exercise, by consulting states, relevant ministries and departments.
The Task Force on the NIP while submitting its final report for FY 2019-25 to Finance Minister Nirmala Sitharaman on April 29 made the recommendations.
Reportedly, two committees will be set up to monitor project progress, eliminate delays, and find ways to raise resources, along with a steering committee in each of the infrastructure ministries that would follow up progress to ensure successful implementation of the projects.
The report, which comes in three volumes, identifies and highlights recent infrastructure trends in India as well as global in all sectors of infrastructure. It also captures sector progress, deficits and challenges.
In addition to update existing sectoral policies, the Final Report also identifies and highlights a set of reforms to scale up and propel infrastructure investments in various sectors throughout the country.
Besides, the report suggests ways and means of financing the NIP through deepening Corporate Bond markets, including those of municipal bonds, setting up development financial institutions for infrastructure sector, accelerating monetisation of infrastructure assets, land monetisation, etc.
Of the total expected spending of Rs 111 trillion, 40% of the projects worth Rs 44 trillion are under implementation, 30% of the projects worth Rs 33 trillion are at a conceptual stage and 20% of the projects worth Rs 22 lakh crore are under development. However, 10% of the remaining projects worth Rs 11 lakh crore have no information or update on their progress.
Sectors such as energy (24%), roads (18%), urban (17%) and railways (12%) cost around 71% of the projected infrastructure investments in India.
The Centre (39%) and States (40%) are expected to have almost equal share in implementing the NIP in India, followed by the private sector (21%).
While releasing the interim report in December 2019, FM Sitharaman had said the proposed spending would be front-loaded and backed by concomitant reforms in various areas – public-private partnership models, enforcement of contracts and dispute resolution ― to achieve intended results.
These projects are on top of the Rs 51 lakh crore spent by the Centre and the states in the last six years, the FM had noted.