New Delhi: Prime Minister Narendra Modi on Thursday said that ₹100 lakh crore will be spent towards infrastructure creation in the country.
Presenting a report card of his government's first 10 weeks after assuming office for the second term, Modi in his sixth Independence Day speech said, “Times are changing and we have to accept that: People's thinking has changed," and added, “Earlier, people were happy with merely a plan to make a railway station. Now people ask when will Vande Bharat Express come to my area?"
The last five years have seen massive spending on roads, railways, water, irrigation and urban infrastructure. Connectivity, both physical and digital, which has a multiplier effect on the economy, is a key development goal for the Narendra Modi administration in its second term as it seeks to steer the economy away from unfavourable headwinds and to becoming the fifth largest in the world.
PM Modi had flagged the first Vande Bharat Express, which is running on the Delhi-Varanasi route, on 15 February this year. In the new train there is more space to store meals for passengers and a slew of modern features like adjustable seats, improved wash basins, automatic doors, WiFi and infotainment system among others.
“People do not want only good railway stations or bus stations, they ask when is a good airport coming?" said Modi.
The government has also set ambitious plans, such as Sagarmala (ports) and Bharatmala (roads), to improve transport infrastructure. While the total investment for the Bharatmala project was pegged at ₹10 lakh crore—the largest ever outlay for a government road construction scheme—the country has envisaged ₹8 lakh crore of investment until 2035 under the Sagarmala programme.
PM Modi spoke about infrastructure creation in areas such as clean energy, electric mobility, gas grid and efforts towards a gas-based economy.
As the country prepares to switch to electric vehicles to curb pollution and cut its dependence on foreign oil, India has become one of the top renewable energy producers globally with ambitious capacity expansion plans. The country has an installed renewable energy capacity of about 80 gigawatts (GW) and is running the world’s largest renewable energy programme, with plans to achieve 175GW by 2022 and 500GW by 2030, as part of its climate commitments.
With several large conglomerates and infrastructure companies weighed down by debt, the onus of creating infrastructure is on the Centre.
“Earlier, the aspiration was to have a good mobile phone but now, people aspire to better data speed," Modi said, adding that in the 75th year of India’s Independence, every household will have electricity access and every village will be connected to an optical fibre network with high-speed broadband connectivity.
The government has set in play a new integrated infrastructure programme, which involves building roads, railways, waterways and airports. The Centre has also been trying to leverage roads, railways and waterways to bring India’s logistics costs down to 8% to make the economy competitive. Since long, India has been grappling with high logistics costs of 14% (as a percentage of the cost of the product), which make exports uncompetitive vis-а-vis those of China, where logistics costs add up to just about 8-10%.
“Today, the government in India is stable, policy regime is predictable… the world is eager to explore trade with India," Modi said and added, “The fundamentals of our economy are strong."
This comes in the backdrop of the government’s goal of making India a $5 trillion economy, with the plan to stimulate the economy also including income tax breaks for purchasing electric vehicles and affordable homes.