India must build infrastructure in the “top gear” to make it a developed nation by 2047, Prime Minister Narendra Modi said on Saturday, in line with the latest budget that cites infrastructure as one of the seven top priorities guiding the country through Amrit Kaal, or the 25 years to India’s 100th year of Independence.
“Infrastructure development is the driving force of the country’s economy. Now we have to improve our speed and move in top gear,” the Prime Minister said while addressing a webinar on “Infrastructure and Investment: Improving logistic efficiency with PM Gatishakti National Master Plan”.
Modi was addressing the eighth of the 12 post-budget webinars, being held between February 23 and March 11 to emphasise importance of key budget proposals and devise ways for their implementation in a coordinated manner, an annual practice since 2021. Besides government officials, the webinar was attended by over 700 senior corporate executives.
Underscoring the importance of far-sightedness in conceptualising infrastructure planning, he cited the example of the redevelopment of Kutch after a devastating earthquake in 2001. He said there could be two ways for restoration — the easiest and cheapest way was quick-fix solutions, and a comprehensive, big and futuristic redevelopment converting disaster into an opportunity. As the chief minister of Gujarat, he preferred the second option by creating bigger and better infrastructure, making the region into a hub of economic activities.
He criticised previous governments for tardy infrastructure development because of their mindset of “poverty as a virtue” and said the present government has not only been successful in eliminating this mentality but also in making record investments in modern infrastructure.
The average construction of national highways has nearly doubled compared to what it was before 2014, he said. Similarly, only 600 km of railway track was electrified per year before 2014, which is now reaching 4,000 km per year, he said.
The robustness of India’s physical infrastructure is important to strengthen the country’s social infrastructure, Modi said, citing the emphasis of his government on setting up wellness centres and housing for the poor. A strong social infrastructure will lead to more talented and skilled youth who will come forward to serve the nation, he added.
The government’s infrastructural development is not just limited to rail, road, ports and airports, Modi said. Citing the example of the budget proposal to create warehousing facilities in villages, he said it will help farmers to store farm produces locally.
Presenting the budget in Parliament on February 1, finance minister Nirmala Sitharaman had said: “We will implement a plan to set up massive decentralised storage capacity. This will help farmers store their produce and realize remunerative prices through sale at appropriate times.”
Infrastructure is one of the key priorities of the Union Budget 2023-24 because it has a multiplier effect on growth and employment. The central government has been raising the capital investment outlays in every budget, especially after the Covid-19 pandemic started in March 2020. In 2023-24, the outlay has been raised by 33% to ₹10 lakh crore, which is about 3.3% of the gross domestic product (GDP).
“This will be almost three times the outlay in 2019-20. This substantial increase in recent years is central to the government’s efforts to enhance growth potential and job creation, crowd in private investments and provide a cushion against global headwinds,” Sitharaman had said. Including grants to states, effective capital expenditure of the Centre is budgeted at ₹13.7 lakh crore in 2023-24, which is about 4.5% of the GDP.
India’s capital spending has been raised five times since 2013-14 and the federal government is moving with a target of investing ₹110 lakh crore under the National Infrastructure Pipeline, Modi said. “This is a time of new responsibilities, new possibilities and bold decisions for every stakeholder,” he said.
There is a need for an integrated approach to infrastructure development, the Prime Minister said, citing the PM Gati Shakti Master Plan as an effective tool. “We have identified the gaps that were impacting the logistics efficiency. That is why, in this year’s budget, 100 critical projects have been prioritised and ₹75,000 crore have been allocated,” he said, inviting increased participation of the private sector in building infrastructure.