PM Gati Shakti – National Infrastructure Master Plan – Explained, pointwise

Introduction

Recently, the Prime Minister has launched the Gati Shakti – National Master Plan for Multi-modal Connectivity. The Gati Shakti scheme will subsume the Rs 110 lakh crore National Infrastructure Pipeline (NIP) that was launched in 2019.

The PM said the government was aiming at adding over 200 airports, helipads, and water aerodromes over the next 4-5 years besides nearly doubling the existing operational natural gas pipeline network, which is about 17,000 km (According to PNGRB as of June 30 2021). India is also targeting an increase in cargo handling at Indian ports and national waterways. The National Master Plan has set targets for all infrastructure ministries to achieve the targets.

But is Gati Shakti a silver bullet for India’s infrastructure challenges, planning and development issues?

What is PM Gati Shakti?

PM GatiShakti is a digital platform that connects 16 ministries — including Roads and Highways, Railways, Shipping, Petroleum and Gas, Power, Telecom, Shipping, and Aviation — with a view to ensuring holistic planning and execution of infrastructure projects.

Aim: PM Gati Shakti aims to institutionalize holistic planning for major infrastructure projects. The projects will be designed and executed with a common vision and will incorporate the infrastructure schemes of various ministries and state governments such as the Bharatmala road project, Sagarmala waterways plan, ports and the UDAN scheme.

Coverage: Economic Zones like textile clusters, pharmaceutical clusters, defence corridors, electronic parks, industrial corridors, Agri zones will be covered to improve connectivity & make Indian businesses more competitive.

It will also leverage technology extensively, including spatial planning tools with ISRO’s satellite imagery. This will be used for real-time monitoring of projects.

What services will be provided by the PM Gati Shakti?

Planning and obtaining clearances: The portal will offer 200 layers of geospatial data, including on existing infrastructure such as roads, highways, railways, and toll plazas, as well as geographic information about forests, rivers and district boundaries to aid in planning and obtaining clearances.

Centralised tracking of projects: The portal will also allow various government departments to track, in real-time and at one centralised place, the progress of various projects, especially those with multi-sectoral and multi-regional impact.

Prioritize projects: Through Gati Shakti, different departments will be able to prioritise their projects through cross-sectoral interactions”.

Project clearances: The portal will also highlight all the clearances that any new project would need, based on its location — and allow stakeholders to apply for these clearances from the relevant authority directly on the portal. The objective is to streamline the process and shorten the period required for clearances.

How PM Gati Shakti will help India’s development?

Bring the economy out of pandemic impacts: The Covid-19 Pandemic reduced the GDP growth and resulted in large job loss, depressed wages and consumption. The infrastructure projects will boost jobs and increase the demand for goods and commodities, besides attracting major investments.

If the Gati Shakti National Master Plan is implemented swiftly, then the Indian economy can achieve a significant growth trajectory by mitigating the impacts of the pandemic.

Solve issues in logistics: According to a study, the logistical cost in India is about 13%-14% of GDP as against about 7-8% of GDP in developed economies. The plan will help India to cut down its logistics cost.

Besides cutting logistics costs, the plan is also aimed at increasing cargo handling capacity and reducing the turnaround time at ports to boost trade.

Help in increasing economic zones and industrial parks: Currently, a number of economic zones and industrial parks are not able to reach their full productive potential due to inefficient and fragmented multi-modal connectivity.

By incorporating infrastructure schemes under various ministries and state governments, the GatiShakti platform will boost the last-mile connectivity.

Reduce implementation overlaps: Poor Infrastructure planning at present results in various challenges. For example, newly-built roads are being dug up by the water department to lay pipes and construction of different tunnels for roads and railways in the same area.

The National Master plan will help to avoid such implementation overlaps. For instance, if a railway line is being built, the Ministry of Road Transport may immediately give clearance for an overpass, and the Power Ministry can begin projects to ensure that trains can immediately have access to power on completion of the tracks.

Save taxpayers money: PM Gati Shakti would address the problem of government departments and Ministries working in silos. There is a wide gap between macro planning and micro implementation, problems of lack of coordination in infra projects and lack of advanced information. This hampers the construction and wastage of the budget.

The National Master Plan will address this, as working on the basis of the master plan will lead to optimum utilization of resources and reduce both cost and time overruns. This will help the government to save thousands of crores of taxpayers money.

Help in reducing human intervention within ministry: Currently, any inter-ministerial issues that arise relating to a project are addressed in regular meetings of infrastructure-related ministries. The Gati Shakti portal would help reduce the human intervention required as ministries will be in constant touch.

What are the challenges associated with the functioning of PM Gati Shakti?

Investments from states: The Economic Survey for 2020-21 underscored the role of active Centre-State partnerships for infrastructure building. The Survey projects maximum investments towards NIP sectors such as energy, roads, urban infrastructure and railways for FY 2021 and 22, with about ₹8.5-lakh crore to be invested by either side annually.

With the pandemic and its associated challenges, the state governments don’t have enough finances to invest such large amounts. This will delay the implementation of the master plan.

Low Credit Off-take: According to the RBI’s paper, the growth rate in credit off-take has steeply declined to 5.8% in November 2020, as against 14.2% in 2013. This will reduce private investment in infrastructure projects. At present, there are concerns about the declining credit offtake trends from banks as they don’t want to get into another Non-Performing Asset (NPA) crisis in future.

The plan does not address a few key infrastructural challenges: Land acquisition is often the biggest impediment in the development of India. Many development projects get delayed due to land acquisition issues. Further, these delays add up to the costs of many projects, making them a less efficient and more costly project for development. There are other issues such as litigation issues, alienation of local communities and the violation of environmental norms, etc.

These issues make the rate of implementation of projects is very slow on global standards. The Gati Shakti master plan offers little or no solution to these major challenges.

How can India improve the implementation of PM Gati Shakti?

Address certain key issues: To the proper implementation of PM Gati Shakti, India needs to address structural and macroeconomic stability concerns, emanating from high public expenditure.

Tackle land acquisition decisions: With the availability of Geographic Information Systems and remote sensing technologies under the master plan, the policymakers have to do well to reclaim lands already subjected to degradation and pollution, rather than alienate controversial new parcels.

Solve the credit offtake challenge: The Economic Survey for 2020-21 mentioned that India needs ₹4.5-lakh crore investments per year from the private sector to boost NIP sectors. So, the government has to address the issues associated with low credit offtake for successful private investments.

Incorporate the digital features in all spheres: This can be done by adding optical fibres along with railway lines and gas pipelines. India also needs digital solutions for aggregation of demand and supply, which can be done by bringing the open network and open protocols under the Gati Shakti initiative.

For instance, Tata Projects has already been using such technological solutions for its various projects like the Dravyavati River Rejuvenation Project. Similarly, the US has built software platforms that achieve 30 to 40% savings.

Improve the performance of roads: India needs to improve the performance of roads for a smooth supply of goods. Roads should be made smart with automatic monitoring of traffic, drone-based support, including drone-based monitoring of maintenance of assets.

In conclusion, the Gati Shakti will boost economic growth, attract foreign investments and enhance the country’s global competitiveness thereby enabling smooth transportation of goods, people and services and creating employment opportunities. Thus, the PM Gati Shakti will help India to realise its dream of becoming the “business capital” of the world. But all the challenges must be addressed on priority in order for the project to be a success.