{"id":54260,"date":"2020-01-02T15:57:00","date_gmt":"2020-01-02T10:27:00","guid":{"rendered":"https:\/\/blogadmin.forumias.com\/?p=54260"},"modified":"2020-02-26T16:00:10","modified_gmt":"2020-02-26T10:30:10","slug":"7-pm-a-tall-plan-on-centres-rs-102-lakh-crore-infrastructure-push-2nd-january-2020","status":"publish","type":"post","link":"https:\/\/forumias.com\/blog\/7-pm-a-tall-plan-on-centres-rs-102-lakh-crore-infrastructure-push-2nd-january-2020\/","title":{"rendered":"7 PM | A tall plan: On Centre&#8217;s Rs. 102 lakh crore infrastructure push | 2nd January 2020"},"content":{"rendered":"\n<p><strong>Context:\n<\/strong>Report\nof the task force on National Infrastructure Pipeline for 2019-2025.<\/p>\n\n\n\n<p><strong>More\nin news:<\/strong><\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>India plans to invest about&nbsp;\u20b9102\nlakh crore in the infrastructure sector in the next five years to achieve the\nGDP target of $5 trillion by 2024-25<\/li><\/ul>\n\n\n\n<p><strong>Infrastructure:<\/strong><\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>Infrastructure sector is a key driver\nfor the Indian economy. <\/li><li>The sector is highly responsible for\npropelling India\u2019s overall development and enjoys intense focus from Government\nfor initiating policies that would ensure time-bound creation of world class\ninfrastructure in the country. <\/li><li>Infrastructure sector includes power,\nbridges, dams, roads and urban infrastructure development. <\/li><li>In 2018, India ranked 44th out of 167\ncountries in World Bank&#8217;s Logistics Performance Index (LPI) 2018.<\/li><li><strong>Market\nSize:<\/strong><\/li><li>Foreign\nDirect Investment (FDI) received in Construction Development sector (townships,\nhousing, built up infrastructure and construction development projects) from\nApril 2000 to March 2019 stood at US$ 25.05 billion, according to the\nDepartment of Industrial Policy and Promotion (DIPP). <\/li><li>The\nlogistics sector in India is growing at a CAGR of 10.5 per cent annually and is\nexpected to reach US$ 215 billion in 2020.<\/li><li><strong>Investments:<\/strong><\/li><li>According\nto India Brand Equity Foundation (IBEF), India has a requirement of investment\nworth Rs 50 trillion (US$ 777.73 billion) in infrastructure by 2022 to have\nsustainable development in the country. <\/li><li>India\nis witnessing significant interest from international investors in the\ninfrastructure space. Some key investments in the sector are listed below.<\/li><\/ul>\n\n\n\n<figure class=\"wp-block-image size-large\"><img data-recalc-dims=\"1\" loading=\"lazy\" decoding=\"async\" width=\"336\" height=\"327\" src=\"https:\/\/i0.wp.com\/blogadmin.forumias.com\/wp-content\/uploads\/2020\/02\/1.jpg?resize=336%2C327&#038;ssl=1\" alt=\"Text Box: India Brand Equity Foundation (IBEF):\n\u2022\tIndia Brand Equity Foundation (IBEF) is a Trust established by the Department of Commerce, Ministry of Commerce and Industry, Government of India. \n\u2022\tIBEF's primary objective is to promote and create international awareness of the Made in India label in markets overseas and to facilitate dissemination of knowledge of Indian products and services.\n\n\" class=\"wp-image-54261\"\/><\/figure>\n\n\n\n<ul class=\"wp-block-list\"><li>In 2018, infrastructure sector in India\nwitnessed private equity and venture capital investments worth US$ 1.97\nbillion.<\/li><li>In\nJune 2018, the Asian Infrastructure Investment Bank (AIIB) has announced US$\n200 million investment into the National Investment &amp; Infrastructure Fund\n(NIIF).<\/li><li>Indian\ninfrastructure sector witnessed 91 M&amp;A deals worth US$ 5.4 billion in 2017<\/li><\/ul>\n\n\n\n<figure class=\"wp-block-image size-large\"><img data-recalc-dims=\"1\" loading=\"lazy\" decoding=\"async\" width=\"705\" height=\"311\" src=\"https:\/\/i0.wp.com\/blogadmin.forumias.com\/wp-content\/uploads\/2020\/02\/2.jpg?resize=705%2C311&#038;ssl=1\" alt=\"\" class=\"wp-image-54262\"\/><\/figure>\n\n\n\n<p><strong>National\nInfrastructure Pipeline for 2019-2025:<\/strong><\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>Report of the Task Force on&nbsp; National Infrastructure Pipeline has been\nsubmitted by Department of Economic Affairs, Ministry of Finance, Government of\nIndia.<\/li><li>Finance Minister Nirmala Sitharaman unveiled\na&nbsp;\u20b9102 lakh crore national infrastructure pipeline, in accordance with the\nNarendra Modi government&#8217;s vision to make India a $5 trillion economy by\n2024-25. <\/li><li>The finance ministry had set up a task\nforce headed by Economic Affairs Secretary to prepare a road map for the\n&#8220;national infrastructure pipeline&#8221; from 2019-20 to 2024-25 under\nthe&nbsp;\u20b9100 lakh crore infra plan.<\/li><li><strong>Aim: <\/strong>To\nachieve the target of $5 trillion economy by 2025, and meet the aspirations of\nthe changing demographic profile, creating new and upgrading existing\ninfrastructure is an imperative.<\/li><li><strong>Vision:<\/strong>\nInfrastructure services that raise the quality of life and ease of living in\nIndia to global standards.<\/li><li><strong>Strategic\ngoals:<\/strong><\/li><li>Provide\na positive and enabling environment for significant private investment in\ninfrastructure at all three levels of government.<\/li><li>Design,\ndeliver and maintain public infrastructure projects to meet efficiency, equity\nand inclusiveness goals.<\/li><li>Design,\nconstruct and maintain public infrastructure to meet disaster resilience goals.<\/li><li>Create\na fast track institutional, regulatory and implementation framework for\nInfrastructure.<\/li><li>Benchmark\ninfrastructure performance to global best practices and standards.<\/li><li>Leverage\ntechnology to enhance service standard, efficiency and safety.<\/li><\/ul>\n\n\n\n<p><strong>Global\ntrends in infrastructure spending: <\/strong><\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>As per the Global Infrastructure Outlook\n2017 published by Oxford Economics, the estimated global infrastructure\ninvestment requirement is $94 trillion during the period 2016 and 2040. <\/li><li>Of this, around half is required in Asia\nalone (primarily China, India and Japan), with roads and electricity sub-sectors\nconstituting around 67% of these investment needs, followed by the\ntelecommunication, railways and water sub-sectors.<\/li><\/ul>\n\n\n\n<p><strong>Importance\nof infrastructure sector given the transformation in India\u2019s demographics: <\/strong><\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>India\u2019s GDP growth is expected to\ngradually swing upwards over the next five years starting from fiscal 2020\nfollowing on the clean-up of financial sector balance sheets, reversing the\ndeleveraging phase with corporates starting to leverage for funding capex,\nleading to growth and payoff from policies and reforms such as the Goods and\nServices Tax and the Insolvency and Bankruptcy Code 2016.<\/li><li>In order to improve India\u2019s global\ncompetitiveness, creating new and upgrading existing infrastructure will be\ncritical along with introducing a slew of supply side reforms. Infrastructure\ndevelopment is labour-intensive, leading to increase in employment\nopportunities and thus, fuelling domestic demand. All of this together can aid\nin initiating a virtuous cycle of higher investments, growth and employment\ngeneration in the economy.<\/li><\/ul>\n\n\n\n<p><strong>Historical\ntrend in infrastructure investment in India: <\/strong><\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>Infrastructure investment in India\nduring the fiscal 2008 to 2017 was estimated at about Rs 60 lakh crore ($1.1\ntrillion at average exchange rates of respective years). <\/li><li>Infrastructure investment in the\nEleventh Five-Year Plan (fiscals 2008 to 2012) was Rs 24 lakh crore and in the\nTwelfth Five-Year Plan (fiscals 2013 to 2017) was Rs 36 lakh crore at current\nprices. <\/li><li>However, infrastructure as a proportion\nof GDP fell to about 5.8% during the Twelfth Five-Year Plan from about 7%\nduring the Eleventh. <\/li><li>As per estimates, India\u2019s infrastructure\ninvestment for fiscals 2018 and 2019 are about Rs 10.2 lakh crore and about Rs\n10 lakh crore, respectively. <\/li><li>During this period, infrastructure\ninvestment was predominantly made by the public sector (Centre and state\ngovernments, with a share of about 65%), while the share of private sector was\nabout 35%.<\/li><\/ul>\n\n\n\n<p><strong>Key\nbenefits of the NIP: <\/strong><\/p>\n\n\n\n<ul class=\"wp-block-list\"><li><strong>Economy:\n<\/strong>Well-planned\nNIP will enable more infra projects, grow businesses, create jobs, improve ease\nof living, and provide equitable access to infrastructure for all, making\ngrowth more inclusive <\/li><li><strong>Government:<\/strong>\nWell-developed infrastructure enhances level of economic activity, creates\nadditional fiscal space by improving revenue base of the government, and\nensures quality of expenditure focused in productive areas <\/li><li><strong>Developers:<\/strong>\nProvides better view of project supply, provides time to be better prepared for\nproject bidding, reduces aggressive bids\/ failure in project delivery, ensures\nenhanced access to sources of finance as result of increased investor\nconfidence <\/li><li><strong>Banks\/\nfinancial institutions (FIs)\/ investors:<\/strong> Builds investor\nconfidence as identified projects are likely to be better prepared, exposures\nless likely to suffer stress given active project monitoring, thereby less\nlikelihood of NPAs<\/li><\/ul>\n\n\n\n<p><strong>NIP\nsector-wise summary:<\/strong><\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>The total project capital expenditure in\ninfrastructure sectors in India during the fiscals 2020 to 2025 is projected at\nRs 102 lakh crore. <\/li><li>The sector-wise annual projected capital\nexpenditure is detailed below. During fiscals 2020 to 2025, sectors such as\nenergy (24%), urban (16%), railways (13%) and roads (19%) accounted for ~70% of\nthe projected infrastructure investments in India.<\/li><\/ul>\n\n\n\n<figure class=\"wp-block-image size-large\"><img data-recalc-dims=\"1\" loading=\"lazy\" decoding=\"async\" width=\"749\" height=\"347\" src=\"https:\/\/i0.wp.com\/blogadmin.forumias.com\/wp-content\/uploads\/2020\/02\/3.jpg?resize=749%2C347&#038;ssl=1\" alt=\"\" class=\"wp-image-54263\"\/><\/figure>\n\n\n\n<p><strong>Conclusion:<\/strong><\/p>\n\n\n\n<p>Reviving the\ninvestment cycle requires more than just ambitious targets. To achieve the\nambitious targets government needs a careful thought about the road-map. It is\nenvisaged that the central and state governments will account for 39 per cent\neach of the projected investment, with the private sector expected to make up\nthe balance. Achieving such ambitious targets require strong will power and\nsystematic roadmap with each sector contributing to the utmost level.<\/p>\n\n\n\n<p><strong>Source:\n<\/strong><a href=\"https:\/\/indianexpress.com\/article\/opinion\/editorials\/sitharaman-economy-infrastructure-projects-6195263\/\">https:\/\/indianexpress.com\/article\/opinion\/editorials\/sitharaman-economy-infrastructure-projects-6195263\/<\/a><strong><\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Context: Report of the task force on National Infrastructure Pipeline for 2019-2025. More in news: India plans to invest about&nbsp;\u20b9102 lakh crore in the infrastructure sector in the next five years to achieve the GDP target of $5 trillion by 2024-25 Infrastructure: Infrastructure sector is a key driver for the Indian economy. The sector is&hellip; <a class=\"more-link\" href=\"https:\/\/forumias.com\/blog\/7-pm-a-tall-plan-on-centres-rs-102-lakh-crore-infrastructure-push-2nd-january-2020\/\">Continue reading <span class=\"screen-reader-text\">7 PM | A tall plan: On Centre&#8217;s Rs. 102 lakh crore infrastructure push | 2nd January 2020<\/span><\/a><\/p>\n","protected":false},"author":61,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"footnotes":""},"categories":[130,955,9],"tags":[],"class_list":["post-54260","post","type-post","status-publish","format-standard","hentry","category-7-pm","category-7-pm-brief-infograph","category-public","entry"],"jetpack_featured_media_url":"","views":{"total":366,"cached_at":""},"jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/54260","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/users\/61"}],"replies":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/comments?post=54260"}],"version-history":[{"count":0,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/54260\/revisions"}],"wp:attachment":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/media?parent=54260"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/categories?post=54260"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/tags?post=54260"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}