Today’s Question

Q National Infrastructure Pipeline is an ambitious step in the direction of achieving multiple development goals. In this context, discuss its features and significance.

Approach 🔍

• Introduce by giving a brief account on the National Infrastructure Pipeline.
• Discuss how this project helps in achieving multiple development goals.
• Discuss in brief the features and significance of this step in the context of projected trends in
Indian economy and demography.
• Give an appropriate conclusion.

Answer ✍️

It is estimated that India would need to spend $4.5 trillion on infrastructure by 2030 to sustain its growth rate. Therefore, in this regard the government has launched the National Infrastructure Pipeline.
The National Infrastructure Pipeline (NIP) consists of the projects and programmes with a total allocation of INR 102 lakh crore for infrastructure development in the next five years.

Features of NIP:
• It includes economic and social infrastructure projects in sectors such as Energy (24%), Roads (19%), Urban (16%), and Railways (13%), amounting to around 70% of the projected capital expenditure in infrastructure in India. Investment in different sectors will help in focused development of each sector under the umbrella of this programme.
• The Centre (39%) and states (39%) are expected to have equal share of the capital expenditure to be undertaken in the infrastructure sector, followed by the private sector (22%).
• Each Ministry/ Department would be responsible for the monitoring of projects so as to ensure their timely and within-cost implementation.
• It has also suggested important reforms such as improving project preparation processes, enhancing execution capacity of private sector participants, financial sector reforms etc.

India’s infrastructure bottleneck is a primary constraint to improving its global competitiveness, as measured by the World Economic Forum’s Global Competitiveness Index. In the same index, India is currently ranked 70 out of 140 countries for its infrastructure quality. And in order to improve the living standards and fulfill SDG 9, India needs to develop quality, reliable, sustainable and resilient infrastructure, including regional and trans-border infrastructure. The National Infrastructure Pipeline , therefore, holds crucial importance.

Significance of NIP in the context of projected trends in Indian economy and demography:

Trends in Indian Economy
o Shift to services-based economy: It is estimated that the share of services in total
employment in India will grow from 27% in 2012 to 48% in 2030. NIP will play a critical
role in boosting the service sector by providing it with adequate and efficient infrastructure. o Increasing unemployment: Infrastructure creation is labour absorbing, which boosts
employment and income generation in the economy and further spurs domestic demand.
o Logistics and Road connectivity: Improved infrastructure capacities also create efficiency gains through improved logistics and networks, which would improve the competitiveness of the economy. This can help kick in a virtuous cycle of higher investments, growth and employment generation in the economy.
o Impact on other programs: Creating new and upgrading existing infrastructure can
specially be critical for the success of other programs like ‘Make in India’ program as
manufacturing competitiveness critically depends on infrastructure.

Demographic trends
o Growing working-age population: It is expected that the working-age population of India will grow 1.2 times during 2015-2030. India is expected to have the world’s largest working-age population of 1.03 billion by 2030 compared with 0.97 billion in China and 0.22 billion in the US. Employment generated due to NIP will be crucial in this scenario. o Increasing urbanization: By 2030, it is estimated that around 42% of India’s population would be urbanised from the current 31%.

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