India’s infrastructure spending may touch a whopping US$1 trillion in the Twelfth Five Year Plan (2012-17) from US$500-billion during the current 11th plan (2007-12)  The ‘infrastructure’ buzz seems to be up for another roar. Come January 2011 and India will have the draft of the much-awaited Twelfth Five Year Plan (2012-17) ready. The groundwork for the same has already commenced under the expertise and guidance of the Planning Commission.
Confirming the news on the draft preparation of the 12th plan while addressing a conference on infrastructure in New Delhi recently, Planning Commission deputy chairman Montek Singh Ahluwalia said infrastructure development will gain major impetus over the next 5 years and infrastructure spending may touch a whopping US$1 trillion, which is just double the amount projected for the Eleventh Five Year Plan.
In the current 11th plan (2007-12), the government estimated US$500-billion infrastructure investment. According to Mr Ahluwalia, India is close to achieving the said investment target for the infrastructure sector.
Financing road projects: A major challenge
Realising financing of road projects has been a major challenge, the government is striving hard to set up an infrastructure debt fund and ease long-term funding.
According to Mr Ahluwalia, long-term financing has been a problem with banks as they had to borrow short-term to lend for long-term projects. Furthermore, implementing public private partnership (PPP) model in road projects has also been a concern in recent times.
Despite this, the road transport and highways minister Kamal Nath is confident enough to achieve the ambitious target of building 20 km of roads per day. “Around 24,000 km of roads will be build across India by 2010-11,” says optimistic Mr Nath during the recent annual general meeting (AGM) of the Indian Chamber of Commerce. But readers remember that 24,000 km of roads is only national highways.
Speaking in a different tone, Mr Ahluwalia stressed state road corporations to aggressively take up district roads and shift from the ‘present’ hype of developing national highways.
The National Development Council has decided to discuss various issues pertaining to PPP project implementation in the road sector on July 24, when it meets to approve the mid-term appraisal of the 11th plan.
Jeeta Bandopadhyay |
