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Plans to take up work worth 15 trillion rupees in highways, says Nitin Gadkari

Amit Agrahari by Amit Agrahari
7 June 2019
in Economy
Plans to take up work worth 15 trillion rupees in highways, says Nitin Gadkari

(PC: Indian Express)

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In the 2019 general election manifesto, BJP promised 144 lakh crore rupees infrastructure investment in the next five years if the party comes to power. As the party came to power with an even larger majority, the road building and other connectivity projects are set for a boost. Nitin Gadkari is again given the responsibility of Road Transport and Highways ministry. “The blueprint for highways is already in place. We plan to take up work worth at least Rs 15 trillion in highways that includes building 22 green expressways, rolling out all stuck projects in the next 100 days and creating a ‘grid of roads’ at par with power grid,” said Nitin Gadkari recently stated.

In the previous tenure, Gadkari’s ministry spent a total of 17 lakh crore rupees on connectivity including 11 lakh crore rupees on highways alone. Revival of stuck projects in the last tenure would be the priority of Nitin Gadkari in this term. He would also revive the projects which have been jammed due to infrastructure leasing and financial services (IL&FS) bankruptcy. There are funding problems in some major infrastructure projects which were being financed by various subsidiaries of the IL&FS when the behemoth failed. Some of these projects are near completion and just need a few days to get completed.

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“Rolling out all stuck highway projects that include many of the IL&FS projects within 100 days” said the transport minister,” said Gadkari. “I reviewed projects yesterday and found out about 225 projects were pending for financial closure etc, which has been resolved and now only about 20-25 projects are left. This is a priority area and the pending projects will be zero within 100 days,” Nitin Gadkari further added.

The big-ticket infrastructure projects in the pipeline are a new airport in Navi Mumbai, railway modernization, dedicated freight corridor, expansion of Delhi and Mumbai metro. The Modi government aims to take GDP growth to double digits and removing the bottlenecks of poor infrastructure is essential for that. Countries like China had achieved double-digit GDP growth for decades through big-ticket infrastructure at home and around the world. More than a quarter of Chinese GDP is directly or indirectly related to infrastructure. India wants to repeat the Chinese growth story through infrastructure development.

The central government’s spending on infrastructure increased exponentially under the Modi government. In the first year, the government allotted only 1.81 lakh crore rupees for infrastructure and this increased to 5.97 lakh crore rupees in 2018-19. The spending increased by more than tripled in the last five years with total spending 19.36 lakh crore rupees but the ambitious target set by BJP in the manifesto (144 lakh crore rupees in next five years) could not be met without private investment.   

Infrastructure has been a priority for the NDA government in the last five years. It has made a significant investment in public transport, highway construction, railways, water transport, and air connectivity. The large public investment in infrastructure was supported by oil bonanza which government got in its initial years due to the slump in crude prices. There has been a very low investment in the road construction sector by the UPA government because various welfare programs like MGNREGA had constrained the government from financing infrastructure building. The last big push in road development was in NDA-1 government led by former Prime Minister Atal Bihari Vajpayee. The two big infrastructure projects, Golden Quadrilateral Network and Pradhan Mantri Gram Sadak Yojna (PMGSY), were started during this time.

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