and Investment Models
Infrastructure is the basic physical systems of a country
for a business entity; transportation, communication, sewage, water and
electric systems are examples of infrastructure. Infrastructure development is
a herculean job as it involves huge investments, long gestation periods,
procedural delays and returns spread over a long period of time.
Infrastructure is, a driver for inclusive growth. Although,
investments in infrastructure are not easily available due to requirements of
lumpy capital investment with very low returns. Such investments are justified
normally on grounds of social benefits rather than on financial viability.
Absence of world class infrastructure facilities in India is
often considered as one of the major impediments to growth. With the sprawling
urbanization, demand for infrastructure continues to rise faster than the
capacity in the economy to satisfy such demands.
the largest rail network in Asia comprising about 67,000 route kilometres,
there has not been much growth in the network since independence. According to
the Ministry of Railways, in the last 69 years, the freight loading has
increased by 13 times and passenger kilometers by 16 times, but the route
kilometers have grown by only 24%.
‘Mission Raftaar’ aims to increase the speed of trains in
Indian Railways. It was announced in the
Railway Budget 2016-17. The mission has
a target of doubling of average speed of freight trains and increasing the
average speed of all non-suburban passenger trains by 25 kmph in the next 5 years.
Main routes have been identified for raising of speed under
Mission Raftaar. These are six routes on Golden Quadrilateral and diagonals
namely, Delhi – Mumbai, Delhi – Howrah, Howrah- Chennai, Chennai – Mumbai,
Delhi – Chennai and Howrah – Mumbai.
These six routes carry 58% of freight traffic and 52% of coaching
traffic with a share of only 16% of the network. Golden Quadrilaterals and its Diagonal routes
have been designated for replacement of loco hauled short distance passenger
trains by MEMUs (Mainline Electric Multiple Unit)/DEMUs (Diesel Multiple unit) having better acceleration
and deceleration characteristics for fast pickup and braking.
‘Mission 41K’ to
save Rs. 41,000 crore on the Indian Railways’ expenditure on energy consumption
over the next 10 years.
This target of
Mission 41K will be achieved by taking a slew of measures which include moving
90% of traffic to electric traction over diesel from present 50% of the total
Problems associated with Railways
Passenger fares has not been revised regularly
while freight charges are increased to recover cost. This has resulted in shifting
of the traffic to other transportation system.
Frequent rail accidents mostly caused by
derailment and at level crossings leading to death of innocent persons due to
inefficient infrastructural development.
Merger of Railway and General Budget and impact on Railways
Railway budget was used for populism and party
politics. These decisions can now be taken by railway board on commercial
Huge revenue deficit of Railways will be
transferred to finance ministry.
Steps to ensure Safety in Railways
Implementation of Kakodkar committee recommendations
which include constitution of a separate safety authority.
GPS, Maps, Anti-collision avoidance systems etc.
must be introduced in Indian railways. The loopholes must be plugged with
The old track design and poor maintenance are
also one of the reasons of frequent train accidents. Thus Track Modernisation
should be ensured at the rapid pace.
High Quality train coaches like latest LHB
coaches, engines, and all other technicalities like advanced braking system,
etc. should be ensured.
India has a road
network of more than 50 lakh kilometres which is the second largest in the
world. These roads carry 65 percent of the freight traffic and 80 percent of
the passenger traffic of the country.
carry 40 percent of the traffic, yet constitute less than 3% of the total road
network in the country. The State Highways have also suffered from prolonged
Pradhan Mantri Gram Sadak Yojana (PMGSY)
A record 47,350 kms. of PMGSY road was
constructed during 2016-17. This is the highest construction of PMGSY roads in
a single year, in the last 7 years.
With a view to reduce the “carbon footprint” of
rural roads, reduce environmental pollution, PMGSY is aggressively encouraging
use of “Green Technologies” and non-conventional materials like waste plastic,
cold mix, geo-textiles, fly-ash, iron and copper slag etc. in rural roads.
Around 4,100 kms. of PMGSY roads were
constructed using ‘Green’ technologies, in 2016-17.
ITEWS for Disaster Prevention
Indian Tsunami Early Warning System (ITEWS) is a network of sensors to
detect tsunamis and a communication infrastructure to disseminate timely alarms
for evacuation of people from coastal and low lying areas. INCOIS (Indian
National Centre for Ocean Information Services) has established a
state-of-the-art early warning centre with all the necessary computational and
communication infrastructure to enable reception of real-time data from all
sensors, data analysis, as also generation and dissemination of tsunami
The Indian Aviation Industry is among the world’s fastest
growing industries. Aviation Sector plays an important role in moving people or
products from one place to another, be it domestic or international. India aims
to become the third-largest aviation market by 2020 and the largest by 2030.
The Civil Aviation industry has ushered in a new era of expansion, because of
factors such as low-cost carriers, modern airports, increasing Foreign Direct
Investment (FDI) in domestic airlines, advanced information technology (IT)
interventions and growing emphasis on regional connectivity.
Importance of Civil Aviation
Employment in the Indian tourism industry is also dependent
on the aviation industry.
Civil Aviation sector makes a significant contribution to
public finances in form of the Service tax paid by air passengers, corporation
tax paid by airline companies, airport, MRO (Maintenance Repair and Overhaul)
firms and income tax paid by their respective employees, along with the revenue collected through taxes on fuel
National Civil Aviation Policy 2016
NCAP has a Vision to create an eco-system to make flying
affordable for the masses and to enable 30 crore domestic ticketing by 2022 and
50 crore by 2027, and international ticketing to increase to 20 crore by 2027.
Similarly, cargo volumes should increase to 10 million tonnes by 2027.
India plans to enter into ‘open sky’ air service agreements
(ASA) with SAARC countries and with countries beyond 5,000 km radius from
Objectives of NCAP
To establish an integrated eco-system which will
lead to growth of civil aviation sector, which in turn would promote tourism,
increase employment and lead to a balanced regional growth.
Ensure safety, security and sustainability of
aviation sector through the use of technology and effective monitoring.
Enhance regional connectivity through fiscal
support and infrastructure development.
Enhance ease of doing business through
deregulation, simplified procedures and e-governance.
Promote the entire aviation sector chain in a
harmonised manner covering cargo, MRO, general aviation, aerospace
manufacturing and skill development.
The policy is very comprehensive, covering 22 areas of the
Civil Aviation sector. It encourages development of airports by AAI, State
Governments, the private sector or in PPP mode. Policy will help in development
of Maintenance Repair and Overhaul business in India.
UDAN (Ude Desh ka Aam Naagrik) Scheme is to develop the
regional aviation market. It is a market-based mechanism in which airlines bid
for seat subsidies.
Under UDAN scheme, half of the seats on the plane will be
capped at Rs. 2,500 per hour’s flight. Government will provide subsidy to
airlines for first three years of operations.
The operators could seek a
Viability Gap Funding (VGF) apart from getting various concessions.
A Regional Connectivity Fund (RCF) will be created to fund
the scheme via a levy on certain flights. States are expected to contribute 20
per cent to the fund.
The UDAN is likely to a give
a stimulus to tourism and employment generation in the hinterland. Through
introduction of helicopters and small aircraft, it is also likely to reduce travel timings in remote and hilly regions,
as well as islands and other areas of the country.
Challenges in the Civil Aviation Sector
Viability-gap funding, subsidized ATF and
concessions can increase the fiscal burden. States need to provide free land
and operational infra to bring down the cost.
Lack of interest of private players, may
overburden Air India which is already under huge stress.
Airport charges are quite high i.e. they
contribute 20% for long distance and 30% for short distance air tickets.
Infrastructure like equipments, technical
manpower etc are inadequate. Air traffic control services and air safety also
need to be ramped up.
The maintenance repair and overhaul (MRO)
charges are high in India, so airlines prefer to go to Abu Dhabi, Jordan,
Singapore for MRO. The high MRO charge is passed on to passengers.
Low cost operations might not ensure much profit
for big airlines.
Way forward for Aviation Industry
industry is largely untapped with huge growth opportunities, considering that
air transport is still expensive for majority of the country’s population. The
industry stakeholders should engage and collaborate with policy makers to
implement efficient and rational decisions that would boost India’s civil
aviation industry. There is a need to make joint efforts towards the growth of
aviation industry rather than involving in unhealthy competition and price
wars. India should also learn from the experience of other BRIC nations and
also partner countries like USA, and should promote more consensus, private participation
in civil aviation to achieve the full potential of its civil aviation industry.
Indian maritime sector handles 95 percent of India’s foreign
trade by volume.
Sagarmala project is a port-led development programme of
Ministry of Shipping. Port led development model would include ports, SEZs,
rail, road, air and waterway connectivity with the hinterland. It also aims at
reducing the logistics costs in operation of ports.
The Sagarmala initiative addresses the challenges in
Maritime Sector by focusing on –
Supporting and enabling Port-led Development
through appropriate policy and institutional interventions and providing for an
institutional framework for ensuring inter-agency and
ministries/departments/states collaboration for integrated development.
Port Infrastructure Enhancement including
modernization and setting up of new ports.
Efficient Evacuation to and from hinterland through
development of multi-modal transport network.
For a comprehensive and integrated planning for
“Sagarmala”, a National Perspective Plan (NPP) for the entire
coastline have been prepared which will identify potential geographical regions
i.e. Coastal Economic Zones (CEZs).
Major Port Authorities Bill 2016
Provisions of the Bill
The port trusts that govern the 12 major
ports in India will be replaced by a Major Port Authorities Board.
Bill provides the government more flexibility
and power to allow private players in the port sector.
Problems faced by Indian Ports
India’s major ports are small in size and carry
less traffic than ports like Singapore or Dubai. Many major ports are affected
by silting and they are not dredged properly.
Due to underinvestment by the government and
private companies in the port sector Modern Infrastructure could not be
The bureaucratic style of functioning of ports
has hampered its efficiency. Major ports are operated by the Central Government
while minor ports are operated by State Governments.
Indian ports do not have the adequate capacity
to handle big container vessels.
For transshipment, India is dependent on other
international ports like Colombo, Singapore etc. Due to this, India not only
loses the potential economic opportunities of a transshipment hub, but it also
cost India nearly 1500 Crore per annum.
High turn-around time, low draft and siltation
and other geographic hindrances.
Poor connectivity to hinterland.
Electricity is one of the
basic human needs and to improve human development, every household must have
access to electricity. Energy is now an unavoidable aspect in the growth of the
nation. Energy is also one of the
for employment generation and poverty alleviation. Economic growth drives the
India has an installed
power generation capacity of 310 GW as of December 2016. With this, India has become
world’s 3rd largest producer and 4th largest consumer of electricity. However,
during 2014-15, per capita electricity generation in India was 1,010 kWh with
consumption rate at 746 kWh per capita. Around 60 per cent of India’s current
power generation capacity is coal based.
The distribution segment
of the Power sector suffers from Aggregate Technical & Commercial losses.
Deendayal Upadhyaya Gram Jyoti Yojana
importance of rural electrification, the Government launched, Rajiv Gandhi
Grameen Vidyutikaran Yojana (RGGVY ). The primary objective of the scheme was
to create rural electricity infrastructure and complete household
electrification. RGGVY was subsumed in the new programme, Deendayal Upadhyaya
Gram Jyoti Yojana (DDUGJY) in December 2014. The scheme intends to accelerate
rural development, generate employment and eliminate poverty through development
in areas of irrigation, small scale industry, cold chains, health care,
education, IT and other services.
Aim of DDUGJY:
The major components of the scheme are:
Strengthening of sub- transmission and distribution network.
Metering at all levels (input points, feeders and distribution
Micro grid and off grid distribution network and Rural electrification-
already sanctioned projects under RGGVY to be completed.
DDUGJY provides complete
flexibility with wider scope as there is no minimum population criterion as
well as there is 100 per cent subsidy for Project Management Agency. Under this
scheme, agriculture-intensive States benefit from works of feeder separation. Under DDUGJY,
electrification of un-electrified Below Poverty Line (BPL) households is
provided free electricity service connection.
Implementation of DDUGJY has considerably reduced
burden of women by reducing number of hours they spent on household activities.
Lighting of the house has also reduced expenditure on kerosene. Now they can learn important activities on health,
nutrition and sanitation from TV programmes available to rural people because
of electricity connection.
UDAY (Ujwal DISCOM Assurance Yojana) was launched by the
GoI, in November 2015. UDAY is expected
to clear the debt burden of discoms so that they are able to buy more units
without adding to losses and achieve 24X7 PFA (Power for All). It will also
give the discoms an opportunity to start afresh. The schemes has following objectives-
Reduction of cost of generation of power
Development of Renewable Energy
Energy efficiency & conservation
Unnat Jyoti By Affordable LED’s for All (UJALA) scheme is
part of the Government of India’s efforts to spread the message of energy
efficiency in the country.
Objective of UJALA Scheme
Promote efficient use of energy at the
Enhance the awareness of consumers about using
energy efficient appliances
Aggregate demand to reduce the high initial
costs thus facilitating higher uptake of LED lights by residential users.
Its aims to make India an LED nation with a target of
replacing 77 crore conventional incandescent bulbs with LED. Under it, every
grid-connected consumer having a metered connection from their respective
electricity distribution company will get LED bulbs at subsidized rates.
The UJALA scheme is implemented by the Energy Efficiency
Services Limited (EESL), a joint venture of PSUs under the Union Ministry of
This application provides highlights of the power
availability in the country on real time basis at the power exchanges.
Basically, for Discoms to buy power.
In order to track real time electrification of rural
households, Govt has launched the Grameen Vidyutikaran Android app or commonly
known as GARV. Recently, the Govt upgraded the app to GARV-II that provides
real time data of all six lakh villages of the country.
Nuclear Power in India
Nuclear power generation has demonstrated excellent performance
in almost all aspects viz. operational and safety records, capacity utilisation,
carbon footprint and quantity of waste generation. Issues pertaining to
proliferation and waste storage are currently well within the realm of being
managed and with the advent of new generation of reactors, these concerns are
going to be further minimised.
India currently has approximately 6 gigawatts (GW) of
nuclear power generation capacity. India’s Department of Atomic Energy’s target
is to have 63 GW of nuclear power capacity by 2032. India also aims to boost nuclear power generation
nationwide so that it accounts for nearly 25% of all electricity in the country
by 2050. With 21 operating plants and 12 plants in the pipeline, we are poised
a period of enhanced growth in this sector. The atomic energy sector is
projected to make a significant contribution to energy security and climate
mitigation over the next few decades.
Nationally Determined Contributions (INDC) at Paris Agreement 2015 is for
reduction in the emissions intensity of its GDP by 33 to 35 per cent from 2005
level, by 2030 and to create an additional carbon sink of 2.5 to 3 billion
tonnes of CO2 equivalent through additional forest and tree cover by 2030. In
order to meet this ambitious target, renewable energy is expected to play a
crucial role in our country. As per the present estimates, India has an
estimated RE potential of about 895 GW from commercially exploitable sources.
India has vast RE potential through wind, solar, biomass and small hydro which
is concentrated in certain parts of the country. The wind and solar potential
is mainly in the southern and western states viz. Tamil Nadu, Karnataka, Andhra
Pradesh, Maharashtra, Gujarat and Rajasthan. As per Section 86(1) (e)
of the Electricity Act,
2003, the State Electricity Commission has been mandated to promote
generation of electricity
from renewable energy sources.
Solar power is also a
prominent feature in India’s Intended Nationally Determined Contributions
(INDC) at the Conference of Parties (COP) in Paris, France. India intends to
achieve 40 percent cumulative electric power installed capacity from non-fossil
fuel based energy resources by 2030, as one of ways to curb global temperature
National Solar Mission
It has a target of 100 GW of Electricity production (both grid connected and off-grid)
from Solar Energy by 2022. Out of this 100 GW, 60 GW is to be achieved through
grid-connected utility scale solar plants and 40 GW through grid connected solar
rooftop projects. National Solar Mission also has an ambitious goal of
providing 2 crore solar lighting systems in place of kerosene lamps to rural
International Solar Alliance (ISA)
Solar Alliance is an initiative by the Government of India to accelerate the deployment
of solar energy for universal energy access and energy security for the future.
The initiative was launched at the Conference of Parties (21st)(Paris,2015)
to the United Nations Framework Convention on Climate Change.
(Photo-Voltaic Integrated Micro Solar Dome) is a low cost and energy efficient
lamp useful particularly for urban slum or rural areas which don’t get
electricity supply. The lamp works by capturing day light and concentrating and
saving it, which can be used during the night time. The device is leak proof, and
can work up to four hours continuously after sunset. This device has been
developed by the Department of Science & Technology as a part of the Green
Remote Village Electrification Programme
Hydro power projects are
generally categorized in two segments i.e. small (less than 25 MW) and large
hydro (more than 25 MW). While Ministry of New and Renewable Energy is responsible
for small hydro projects, the large hydro power is dealt by Ministry of Power.
It is a contract between a private Party and Govt for
providing public asset or service.