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Shore up infrastructure

The public-private partnership needs a far larger inflow of private investment and the Environment Impact Assessments need to be done properly by engaging civil society, writes Abhishek Singhvi.

india Updated: Jun 06, 2007 02:21 IST

Travelling through South Korea, I was struck by the country’s infrastructure. Physical assets were visible everywhere: bridges, highways, superfast trains, state-of-the-art airports, 100 per cent electrified villages, 100 per cent sanitation and high teledensity. The same is true for several other East Asian countries. India requires similar growth in several core areas.

We, too, have our own success stories: telecom, construction, aviation and railways. However, the most remarkable of them all — telecom — is struggling to expand its reach. India is the world’s fastest-growing mobile market but rural telephony is still a luxury. Construction is also growing at a scorching pace — the challenge here is quality. We need a regulator for the construction industry who can put in place the proposed law that aims to control and punish illegal practices like booking and selling space without any land title, getting money upfront from buyers but not linking the project to the progress of the construction and so on. Such a law should not be seen as an obstacle to growth. Creating global quality norms will make the industry globally competitive.

Aviation no longer seeks passengers, airlines or aircraft. There has been an explosion of all the three, and the domestic sector is booming. The challenge is to create more airports apart from the few showpieces in the four metros. Today out of 122 airports under the Airports Authority of India, at least 50 per cent need to be modernised. The Indian traveller needs functional airports in smaller but economically vibrant towns like Kanpur, Jalandhar and so on. The industry needs trained pilots and support staff.

An unlikely inclusion in this success list is the Indian Railways. This much-maligned sector has bounced back from the brink of bankruptcy. Run by professionals and minimum political interference, reforms like round-the-clock freight loading service have increased revenues. Freight contributes 70 per cent of railway’s revenues. Lower rates and higher volumes, both in passenger and freight, coupled with outsourcing of several ancillary activities has enabled the behemoth to surprise us all. The main challenge is not only to sustain this growth but also quickly convert narrow-gauge tracks to broad gauge and a greater focus on new tracks and rail safety.

Rural infrastructure is the real long-term challenge. Regional disparities have to be tackled on a war footing. Speedy operationalisation of 4,130 rural clusters under the Provision of Urban Amenities in Rural Areas is necessary. These clusters are supposed to provide comprehensive connectivity of roads, power, IT, telecom and so on. Bharat Nirman is one of our most remarkable projects, which looks at improving the irrigation potential, rural roads, rural electrification, telecom and so on. These projects have to be speeded up and harmonised with earlier initiatives like the Rajiv Gandhi Drinking Water Mission and Nirmal Gram, the total sanitation plan for villages.

We need to take a leaf out of the China’s special economic zone success story and indigenise it. Despite over 250 approvals and 164 in-principle approvals, only 63 have been notified. We need to engage the rural civil society and convince it of the benefits. We have to constantly reinvent ourselves and not be hesitant to experiment. The Jindal Groups’ steel SEZ in West Midnapore has assured jobs to one member from each family who lost their land; compensation is being negotiated — half of which will be paid in cash and the rest will be deposited in a bank account. The farmer can access the account and, most importantly, they will be shareholders in the new company.

Electricity is another cause of concern. The Tenth Five-Year Plan has a deficit of 25 per cent as far as capacity addition goes. The 11th Five-Year Plan’s projection of 78,000 MW additional capacity will have to make up for this deficit. Add to this, distribution and transmission losses of 40 per cent, continuing cross-subsidisation, inadequate private sector investment, continued reliance on coal and the slow exploitation of the huge untapped potential of hydroelectric energy. Fifty per cent of India’s hydro energy is in Arunachal Pradesh. But lack of infrastructure makes it difficult to exploit this potential.

Roads and highways development with railways, aviation, shipping and ports, which constitute the transport infrastructure, is the special focus of the 11th Plan (2007-12). We need to ensure private investment for the construction of rural roads, apart from national and state highways. Figures indicate that even infrastructure funding agencies like IIFC and IDFC advance loans for building national highways but not for state roads.

A less-complicated Model Concession Agreement — the current model has been aptly described as a Lawyers’ Employment Act — has to be devised. A unified transport regulator can impart holistic continuity and consistency to this vital infrastructure segment. In addition, the public-private partnership needs a far larger inflow of private investment and the Environment Impact Assessments need to be done properly by engaging civil society. The result of such an inclusive approach will be much longer than alternative coercive models.


Abhishek Singhvi is MP, Congress National Spokesperson and a Senior Advocate