Sunday, October 10, 2010

Is India an Infrastructure Deficient or Infrastructural Mess?

A lot has been said and written about India’s slow pace of infrastructure development despite the 2nd highest GDP growth rate. In the 11th five year plan, India expects to spend USD 500 billion and increase the spending from 5% to 10% of the GDP in building infrastructure the next decade. However, digging little deeper you will find that lack of infrastructure is only a part of problem. A large part of the problem lies with the existing infrastructure that has been created by spending huge sum and has done little to improve efficiency of goods movement.

Highways and expressways have been built to connect length and breadth of the country but inter-state movements are still marred with check posts problems where vehicles have to wait for hours for clearance to cross. Different types of forms and permits only result in delays and corruption. The GST implementation date is nowhere in sight. Poor quality and inadequate maintenance of the roads that are washed out after every rain is another problem. Last mile connectivity has not received any attention worth talking about.

The skewed development in favour of road infrastructure in comparison to the railways and waterways reflects the short-sightedness of our planners. It is a well known fact that road transportation is inefficient compared to railways or waterways. The dedicated freight corridors by Indian railways is still a distance dream and water transport is non existent. Even the existing railway infrastructure is not utilized to full potential. Reducing the tare weight of wagons, block signalling and proper maintenance of tracks can improve the freight carrying capacity by 5% to 10%. India has 8000 kms of coastal line that can be effectively used for movement between the coastal towns. The Indian ports are still congested due to archaic systems and procedures. The newly built ports are yet to realize their potential and contribute to less than 10% of ship traffic.


According to an estimate about USD 45 billion are lost every year due inefficiency of existing infrastructure. So, it is not just inadequate development but poor planning & execution of infrastructure development that is leading to the chaos that we are so used to now. Hopefully, the government will wake up to these facts and appoint a unified command to improve quality and productivity of existing infrastructure in an integrated manner.