Infrastructure - a necessity, some data and a solution
Posted : January 30, 2005 at 7:58 am [IST]
India can’t just think to repeat the success story of IT sector in manufacturing sector without a world-class infrastructure. And the bid for higher shares in world markets will be futile.. Very soon Indian firms will have to compete to defend their shares in domestic markets in the face of zero duty imports from ‘free trade agreement countries’. India will have to compete with the countries that have better infrastructure and lower transactions costs; and so produce at cheaper cost.
Several initiatives of almost a decade have failed to get the result. And India is lagging behind badly. It will be worthwhile to make a cursory comparison with China. While India has a larger road network (3.3 million km) compared to China’s (1.81 m km), the latter has 30,000 km of expressways. India has initiated the golden quadrilateral programme under which less than 3,500 km was reported to have been completed by the end of 2004. The project must be speeded up to get he benefits faster rather than blaming previous government that took the historic initiative.
In 2001, Chinese airports handled almost 10 times more freight than Indian airports and per capita electricity consumption in China was 893 kwh as compared to India’s 365 kwh. Teledensity in India has increased from a dismal 2 per 100 at the end of the last century to above 8 now due to the ‘mobile revolution’. The corresponding figure for China is much higher at above 42 per 100 and is rising as rapidly as ours.
India is behind all our major Asian neighbours in infrastructure and in all likelihood falling behind further. As a result, it’s not only the foreign firms which prefer alternative locations for their new plants, but Indian firms have also now started to put up new capacity in other countries. Much needed employment generation is thus sacrificed for want of adequate infrastructure.
Estimates for the next five years range from $150 billion, indicated by the Prime Minister in November 2004, to more than $200 bn, estimated on the basis of investments proposed in the Tenth Plan and various sector committee reports. This implies an annual capital expenditure of between $30-40 bn, which converts to approximately 5-7% of current GDP. A major and unprecedented resource mobilisation effort is called for.
Policies and programmes are getting announced. However, you hardly see much all around. Many things can be done to expedite that. One such initiative may to make good pucca roads along all the existing irrigation canals that can provide a all season links to the villages on both sides of the canals.
- Indra
Category: Government Policy/Administration |
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