Union Finance Minister Smt. Nirmala Sitharaman in her Budget speech 2019-20 announced that Rs. 100 lakh crore would be invested on infrastructure over the next five years. The Prime Minister, Shri Narendra Modi, in his Independence Day speech 2019 reiterated that “For development of modern infrastructure, an amount of Rs. 100 lakh crore has been earmarked for this period which will create new job opportunities besides improving the living standards.”
NIP is a first-of-its-kind, whole-of-government exercise to provide world-class infrastructure across the country, and improve the quality of life for all citizens. It aims to improve project preparation, attract investments (both domestic and foreign) into infrastructure, and will be crucial for target of becoming a $5 trillion economy by FY 2025.
The NIP has been made on a best effort basis by aggregating the information provided by various stakeholders including line ministries, departments, state governments and private sector across infrastructure sub-sectors identified in the Harmonised Master List of Infrastructure. To draw up the NIP, a bottom-up approach was adopted wherein all projects (Greenfield or Brownfield, Under Implementation or under conceptualisation) costing greater than Rs 100 crore per project were sought to be captured.
The Final Report of NIP Task Force is projecting total infrastructure investment of Rs 111 lakh crore during the period FY 2020-25 in light of additional/amended data provided by Central Ministries/State Governments since the release of summary NIP Report. The Final Report of NIP task force is in three volumes. Volume I & II will be uploaded on the DEA website www.dea.gov.in, www.pppinindia.gov.in and on the Ministry of Finance Portal and project database enlisted in Volume III A&B will be uploaded on the India Investment Grid Portal in due course.
Out of the total expected capital expenditure of Rs. 111 lakh crore, projects worth Rs 44 lakh crore (40% of NIP) are under implementation, projects worth Rs 33 lakh crore (30%) are at conceptual stage and projects worth Rs 22 lakh crore (20%) are under development Information regarding project stage are unavailable for projects worth Rs 11 lakh crore (10%). Sectors such as energy (24%), roads (18%), urban (17%) and railways (12%) amount to around 71% of the projected infrastructure investments in India. The Centre (39%) and States (40%) are expected to have almost equal share in implementing the NIP in India, followed by the private sector (21%).
The final report identifies and highlights recent infrastructure trends in India as well as global in all sectors of infrastructure. It also captures sector progress, deficits and challenges. In addition to update existing sectoral policies, the Final Report also identifies and highlights a set of reforms to scale up and propel infrastructure investments in various sectors throughout the country. The report also has suggested ways and means of financing the NIP through deepening Corporate Bond markets, including those of Municipal Bonds, setting up Development Financial Institutions for infrastructure sector, accelerating Monetisation of Infrastructure Assets, Land monetisation, etc.
The Task Force has recommended that three Committees be setup:
- a Committee to monitor NIP progress and eliminate delays;
- a Steering Committee in each Infrastructure ministry level for following up implementation; and
- a Steering Committee in DEA for raising financial resources for the NIP.
While basic monitoring will vest with the ministry and project agency, there is a need for higher level of monitoring on reforms to be undertaken and to deal with issues of stalled projects. The basic elements of the monitoring and evaluation framework including recommended governance escalation matrix is given in Volume-I of the NIP report.
The NIP project database would be hosted on India Investment Grid (IIG) shortly to provide visibility to the NIP and help in its financing with prospective investors; domestic and foreign, able to access updated project level information. Each line Ministry/State would further add new projects and update their respective project details at pre-defined time intervals so that updated data is available to prospective investors.