Raising funds for infrastructure will be "challenge": Economic Survey

Our Bureau New Delhi | Updated on January 31, 2020

The lull in infrastructure activities and cancellation of some major projects remain a cause for concern though better prices in some markets have provided relief   -  PV Sivakumar

States that well prepared projects might attract investors

Admitting that raising funds for Government’s plan to spend $ 1.4 trillion on infrastructure over the next five years is a “challenge”, the Economic Survey hoped a set of well prepared projects might help attracting investors.

The Economic Survey tabled by Finance Minister Nirmala Sitharaman.

India recently launched the National Infrastructure Pipeline (NIP) requiring $1.4 trillion over a five year period of fiscal 2020-2025, as adequate infrastructure is essential for inclusive growth, India has set a target to become a $5 trillion economy.

“Financing of the National Infrastructure Pipeline will be a challenge but the Survey hoped that a bouquet of well prepared project(s) will attract from Central and State Government, urban local government, banks and financial institutions, PE funds and private investors, both local and foreign,” stated the official release.

Investment in infrastructure is necessary for growth. Power shortages, inadequate transport and poor connectivity affects overall growth performance, it noted.

Contribution of transport

In its focus on the transport sector, the survey noted that road transport is the dominant mode of transportation in terms of its contribution to Gross Value Added (GVA). GVA measures the net contribution of a sector minus the inputs.

The share of transport sector in the GVA was about 4.77 per cent, of which the largest chunk is contributed by road transport (3.06 per cent), followed by Railways (0.75 per cent), air transport (0.15 per cent) and water transport (0.06 per cent), stated an official release on the survey.

Total investment in the roads and highways sector has gone up more than three times in five year period of 2014-15 to 2018-19, it said.

The Economic Survey gave an overview of sectoral developments relating to Railways, Road Transport, Civil Aviation, Shipping, Telecom, Petroleum and Natural Gas, Power, Mining, Housing and Urban Infrastructure.

Published on January 31, 2020

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