For infrastructure, the Budget has devoted a massive ₹11.11 lakh crore for building highways, ports, railways, and power plants. This process is proposed to continue for five years to spur economic growth and create jobs.
Finance Minister Nirmala Sitharaman said the Central government's investment in infrastructure during the past few years had made a huge difference in terms of greater economic growth. She said, "The spending of the Central government in infrastructure has given substantial multiplier effect to the economy. We remain committed to continuing the strong fiscal support for infrastructure in the coming five years, all the while staying focused on other priorities and supporting fiscal consolidation. This year, I proposed ₹11,11,111 crore for capital expenditure, 3.4% of our GDP."
The Centre has also made appeals to states and the private sector to pitch in with their own contributions to step up the development pace.
Added Sitharaman, "We shall support and facilitate infrastructure creation for all those States which are willing to take steps in this direction, in terms of their priorities. This year, we have allocated ₹1.5 lakh crore for the purpose of long-term, interest-free loans to support States for resources allocation."
Besides, private sector investment would be harnessed in infrastructure development through viability gap funding and other supportive policies and regulations. A new framework on market-based financing will be implemented, she said.
The Economic Survey presented on Monday said, "Central government's investment in large-scale projects, especially in highways, seaports, railways, and airports assumes center stage. But with equal emphasis, it said that state governments and the private sector also must contribute to development to a greater extent.".
The survey has found that the construction of National Highways has increased from 11.7 km per day in FY14 to 34 km per day by FY24. Likewise, the capital expenditure on Railways increased by 77 percent during the last five years to significant investment in new lines, gauge conversion, and doubling of existing tracks.
In FY24, 21 new terminal buildings at airports have become functional and increased the overall passenger handling capacity by about 62 million passengers per annum. In 2023, India jumped to the 22nd rank in the World Bank Logistics Performance Index for International Shipments from 44th rank in the year 2014.
"Given that infrastructure-creation efforts in India are currently predominantly public sector-led, a higher level of private sector financing and resource mobilisation from new sources will be crucial for India to continue down the path of building quality infrastructure. Facilitating this would not only require policy and institutional support from the Central government but state and local governments would have to play an equally important role," the survey stated.
It also pointed out that although infrastructure development in India is largely public sector-driven, increased private financing and resource mobilization from new sources are required if the process of development has to be sustained. This will need not only active support from the Central government but also active participation by state and local governments.
He also announced the launch of Phase IV of PMGSY for all-weather connectivity to rural habitations with 25,000 of them now becoming eligible due to increase in population.
"Bihar has frequently suffered from floods, many of them originating outside the country. Plans to build flood control structures in Nepal are yet to progress. Our government, through the Accelerated Irrigation Benefit Programme and other sources, will provide financial support for projects with an estimated cost of Rs 11,500 crore, such as the Kosi-Mechi intra-state link and other ongoing and new schemes including barrages, river pollution abatement and irrigation projects. In addition, survey and investigation of Kosi related flood mitigation and irrigation projects will be undertaken," Nirmala Sitharaman said.
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