Budget 2019 gives massive push to infrastructure, connectivity2 min read . Updated: 05 Jul 2019, 12:28 PM IST
- Finance minister Nirmala Sitharaman said the government plans to use rivers for cargo transportation
- Projects such as industrial corridors, DFC, Bharatmala, Sagarmala and UDAN schemes will continue to improve connectivity and increase competitiveness
New Delhi: The government plans to restructure the national highways programme to create network of highways grid of a desirable capacity for better connectivity, finance minister Nirmala Sitharaman said today.
Sitharaman said the government envisions using rivers for cargo transporation, a move that will decongest roads and railways and said that the railway ministry is in the process of completing the ambitious dedicated freight corridor (DFC). She also said that railways will be encouraged to make investments and expand network in suburban areas.
Railway infrastructure will need investment of ₹50 lakh crore between 2018 and 2030, she said adding that Public Private Partnerships (PPP) will be used to unleash faster development and delivery of passenger freight services.
The government will also launch station modernization programme this year, she said.
Projects such as industrial corridors, DFC, Bharatmala, Sagarmala and UDAN schemes have and will continue to improve connectivity and increase competitiveness. Road corridor project Bharatmala, port-linked industrialization plan Sagarmala and UDAN will help in bridging the rural-urban divide and improve transport infrastructure. The minister also spoke of allowing commercial activity around transit hubs. The finance minister also expects cargo movement in Ganga will increase four times in four years with the creation of transit hubs at Varanasi, Sahigbanj and Haldia.
The government has set an investment target of ₹80,250 crore for phase three of the Pradhan Mantri Gram Sadak Yojana, under which the government wants to build 1,25,000 km of village roads. The earlier phases of this scheme led to the construction of 30,000 km of village roads with green technology, which will continue, Sitharaman said.
The finance ministry had allocated the highest-ever budgetary support of ₹83,016 crore to the highways sector in the interim budget announced earlier this year in February and ₹64,587 crore for railways.
“The budget speech duly emphasized the importance of infrastructure and connectivity to the Indian economy – in terms of enhancing and taking forward programs across various key infrastructure sub-sectors. The budget’s focus on comprehensive plans and blue prints for various infrastructure plans/ grids is a welcome one – especially in the context of: considering systemic trade-offs and development of economic and efficient infrastructure, and involving private sector in this area in a bigger way on a long-term basis," said Peeyush Naidu, partner, Deloitte.
With regard to power, Sitharaman said the government would focus on “one nation, one grid". The government will introduce policy interventions to revive nearly 24GW of natural gas-powered power plants, currently stranded for the lack of natural gas supply. The government will also “examine the performance so far of the Ujwal Discome Assurance Yojana (UDAY), which had been introduced to stabilize the financial bearings of state power distribution companies. The Centre will also also look into the electricity tariff policy and tweak it to benefit the sector struggling to sign long-term power purchase agreements with states.
The country has raised ₹24,000 crore by monetizing public infrastructure, through infrastructure investment trusts, real estate investment trusts and the toll-operate-transfer scheme of the National Highways Authority of India. To boost investment, the government will encourage foreign portfolio investors to invest in infrastructure debt funds, introduce credit default swaps for the infrastructure sector, deepen the corporate bond market, and encourage equity investment by non-residential Indians.