INDIAN ECONOMY SEMINARWELCOME TO ALL

SHANSON SHAJI15-PEC-25

IN INDIA’S ECONOMIC DEVELOPEMENT

IMPORTANCE OF…….

INTRODUCTION• Infrastructure, in general, defines as a set of facilities through which goods and services

are provided to the public. Infrastructure is the stock of basic facilities and capital equipment needed for the functioning of a country or area; the term to refer collectively to the roads, bridges, rail lines, and similar public works that are required for an industrial economy, or a portion of it, to function.

• The total investment in infrastructure in 2016–17 was estimated to be around 6-9% of GDP.

• According to BUDGET Plan, the total investment in infrastructure required is 9% and 11% in the ending years.

• According to the budgeted plan, the total investment in infrastructure required is 7.5% • GDP growth averaging 9% per year can be achieved only by

• overcoming infrastructure deficit.• adequate investment takes.

• Achieved through a combination of public investment, public-private-partnerships (PPPs) and exclusive private investments

[Source: www.planningcommission.nic.in]

OBJECTIVES OF THE STUDY

o To examine the theoretical framework of infrastructure.o To analyse the socio economic relationship between infrastructure development and economic growth.

NEED OF THE STUDY• Every economy either developing or developed counrty has

two kinds of main basic objectives:- • Providing basic needs and facilities to their population • Achieving higher growth rates.

The need for studying importance of infrastructure growth and development. How infrastructure plays a dynamic role to fulfil their growth targets as well as achieving higher living standards of their mass population.

IMPORTANCE OF INFRASTRUCTURE

INVESTMENT PLAN  X Plan XI PlanSectors US $ billion Share (%) US $ billion Share (%)Electricity (incl. NCE) 72.96 33.49 166.63 32.35Roads and Bridges 36.22 16.63 78.54 15.25Telecommunication 25.84 11.86 64.61 12.54Railways (incl. MRTS) 29.91 13.73 65.45 12.71Irrigation (incl. Watershed) 27.88 12.80 64.34 12.49Water Supply and Sanitation 16.20 7.44 35.93 6.98Ports 3.52 1.61 22.00 4.27Airports 1.69 0.78 7.74 1.50Storage 1.20 0.55 5.59 1.09Gas 2.43 1.11 4.21 0.82Total US $ billion 217.86

100515.05

100Rs. crore 871,445 2,060,193

[Source: www.planningcommission.nic.in]

Electricity32%

Roads 15%Telecom

13%

Railways13%

Irrigation12%

Water Supply and Sanitation

7%

Ports4%

Airports2% Gas

1%

Storage1%

XI PLAN INVESTMENT

[Data Source: www.planningcommission.nic.in]

PROJECTED INVESTMENT IN INFRASTRUCTURE IN THE ELEVENTH PLAN

2007-08 2008-09 2009-10 2010-11 2011-120

100000

200000

300000

400000

500000

600000

700000

270,724322,390

390,957

482,455

593,666

Projected Investment in Infrastructure in the Elevent Plan (Rs. 20,60,193 crore)

(Rs.

cro

re)

[Data Source: www.planningcommission.nic.in]

• Rs. 27,000 crore to be spent on roadways.• 65 eligible habitats to be connected via 2.23 lakh kms of road.

Current construction pace is 100 kms/day.• Shops to be given option to remain open all seven days in a week

across markets.• Rs. 55,000 crore for roads and highways. Total allocation for road

construction, including PMGSY, - Rs 97,000 crore.• India's highest-ever production of motor vehicles was recorded in

2015.• Total outlay for infrastructure in Budget 2016 now stands at Rs.

2,21,246 crore.

UNION BUDGET 2016-17 HIGH LIGHTS ON INFRASTRUCTURE

• New greenfield ports to be developed on east and west coasts.• Revival of underserved airports. Centre to Partner with States to revive

small airports for regional connectivity.• 100 % FDI in marketing of food products produced and marketed in India.• Dept. of Disinvestment to be renamed as Dept. of Investment and Public

Asset Management.• Govt will amend Motor Vehicle Act in passenger vehicle segment to allow

innovation.• MAT will be applicable for start ups that qualify for 100 % tax exemption.• Direct tax proposals result in revenue loss of Rs.1060 crore, indirect tax

proposals result in gain of Rs.20,670 crore.

UNION BUDGET 2016-17 HIGH LIGHTS ON INFRASTRUCTURE

• Focus on making India a manufacturing hub to ensure employment to our youth. Make In India to promote entrepreneurship by making our youth job creators than being job seekers.• National Investment & Infrastructure Fund announced.• Through PPP (Public private partnership)model. Public investment to be

stepped up to catalyze private investments.• Increased Budgetary allocation to Roads & Railways; Tax-free infra bonds for

Rail, Roads transport projects.• 5 Ultra Mega power projects, of 4000 MW announced.• Ports in public sector will be encouraged to corporatize & become

companies under companies act

UNION BUDGET 2016-17 HIGH LIGHTS ON INFRASTRUCTURE

PEOPLE LIVING STANDARDS IMPROVES

BEFORE

AFTER

ADVANTAGES OF PROMOTING INFRASTRUCTURE

GDP INCREASES

• Country economic growth improves• Improves Job Opportunities• Improves Sector development

ADVANTAGES OF PROMOTING INFRASTRUCTURE

DIFFICULTIES IN PROMOTING INFRASTRUCTURE

The Urban infrastructure problems in India are:• Urban residence• Business premises• Power• Urban transport• Water• Airports• Railways• Seaports• Roads• Bridges• Solid waste management• Health care• Entertainment• Communications

The Rural infrastructure problems in India are:

Power IrrigationDrinking WaterRural housingRoadsHealth careEducationTelecommunication

CONCLUSION• Increase Private participation to fund the deficit in investment to attain GDP growth rate of 6-9%•Development of the infrastructure sector is crucial to the growth of the Indian economy. Sustainable development can only be attained through a careful analysis of the factors that have mitigated growth in the past, and thereafter, taking the appropriate corrective measures.•Over the last decade, the Indian government has made significant efforts to eliminate bottlenecks in these areas. It has initiated policies and schemes such as ECs/EIs and Model Concession Agreements to increase the inflow of private sector investments and make the bidding process for projects more transparent.

By SHANSON SHAJI