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Thursday , 30 May 2024

Budget 2021 gives a Boost to Infrastructure Sector

To further improve the  country’s infrastructure, Finance Minister Nirmala Sitharaman has proposed to significantly enhance capital expenditure to Rs 5.54 lakh crore in the next fiscal. The focus is also on creating institutional structures and giving a big thrust to monetizing assets to achieve the goals of the National Infrastructure Pipeline (NIP). This will require a major increase in funding both from the government and the financial sector, she said.

 NIP was launched in December 2019 with 6,835 projects, and now has been expanded to 7,400 projects. Around 217 projects worth Rs 1.10 lakh crore under some key infrastructure ministries have been completed.

 The minister  has also announced that a sum of Rs 20,000 crore has been provisioned in the Budget to capitalise a Development Financial Institution (DFI). The aim is  to have a lending portfolio of at least Rs 5 lakh crore for this DFI in three years time. A  Bill will be introduced to set up the DFI which will act as a provider, enabler and catalyst for infrastructure financing.

 There are other initiatives like launching a national monetisation pipeline of potential brownfield infrastructure assets, creating an asset monetisation dashboard  for tracking the progress and to provide visibility to investors.

 Listing measures in this direction,the Minister  said that the  National Highways Authority of India (NHAI) and Power Grid Corporation of India (PGCIL) have sponsored one InvIT  each that will attract international and domestic institutional investors.

Five operational roads with an estimated enterprise value of Rs 5,000 crore are being transferred to the NHAI infrastructure investment trust (InvIT). Similarly, transmission assets worth Rs 7,000 crore will be transferred to the PGCIL InvIT.

 Railways will monetize dedicated freight corridor assets for operations and maintenance, after commissioning.

More infrastructure assets  will be rolled out under the asset monetization programme: NHAI operational toll roads; transmission assets of PGCIL; oil and gas pipelines of GAIL, IOCL and HPCL; AAI airports in tier II and III cities; other railway infrastructure assets; and  warehousing assets of CPSEs such as Central Warehousing Corporation and NAFED.

Major Expressways/Corridors

  • Delhi-Mumbai Expressway: Remaining 260 km will be awarded before 31.3.2021.
  • Bengaluru – Chennai Expressway: 278 km will be initiated in the current financial year. Construction will begin in 2021-22.
  • Delhi-Dehradun economic corridor: 210 km corridor will be initiated in the current financial year. Construction will begin in 2021-22.
  • Kanpur-Lucknow Expressway: 63 km expressway providing an alternate route to NH 27 will be initiated in 2021-22.
  •  Chennai – Salem corridor: 277 km expressway will be awarded and construction would start in 2021-22.
  • Raipur-Vishakhapatnam: 464 km passing through Chhattisgarh, Odisha and North Andhra Pradesh will be awarded in the current year. Construction will start in 2021-22.
  • Amritsar-Jamnagar: Construction will commence in 2021-22
  • Delhi –Katra: Construction will commence in 2021-22

Advanced Traffic management system with speed radars, variable message sign boards, GPS enabled recovery vans will be installed in all new four and six lane highways.

Indian Railways has prepared a ‘National Rail Plan for India – 2030’ under which a ‘future-ready’ railway system will be created by 2030, she said.

To strengthen urban infrastructure, a new scheme will be launched at a cost of Rs 18,000 crores to support augmentation of public bus transport services.

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