The infrastructure industry plays a pivotal role in advancing the economic growth of the nation. The sector stands as a pillar in enhancing the living conditions of the nation’s citizens. The government is currently investing and adopting measures in order to raise the market to world-class standards. Aiming for sustainable development, the government of India plans to invest US $14 trillion by the year 2023. Being an industry that provides the best employment opportunities and simultaneously a sector that can boost the overall GDP through its “multiplier effect,” where a one percent investment can result in a two percent increase in GDP, it has seen a drastic shift in its progress slope with the advent of the COVID-19 pandemic. The shortage of finance, human resources, and capital has severely led to the stalling of numerous initiatives.

One of the biggest constraints the country is presently facing is the availability of land for development projects. The majority of building projects are held up because of delays in the appropriate acquisition of land, which ultimately results in the disappointment of investments made by the private sector. Aside from this, the provision of financial resources is an extremely important factor in the expansion of the infrastructure industry. Purchases, technological advancements, high-priced equipment, delays in procedure, and other factors are all considered part of infrastructure investments. Payback or return on investment should be the major focus of this endeavour. In this case, a drop in short-term profits is brought about as a result of the lengthy payback period caused by their long-term financing structure.

Another hurdle that stands in the way of the growth of the industry is connected to the regulatory frameworks that are in place in the country. The clearance of the projects and their successful execution are both slowed down as a result of the multiple procedures that are connected to the numerous ministries and authorities. In most of the cases, these regulatory and administrative delays result in both time and cost overruns, making it difficult to maintain the faith of investors and maintaining the integrity of the project without compromising its quality.

In a world where top talents, jobs, and trades are in a competing phase, the government must ensure its investments in those areas that may benefit the public the most and provide a competitive advantage. Transportation sector is where the country may focus on to bring up progress in the infrastructural development. These includes investments in roads, trains, and aviation, maritime and inland waterways. With more than 7500 km coastline and 14500km potentially navigable rivers, India has huge growth potential in shipping. With the weak connectivity between ports to roads and railways, the nation must focus on improving these links and promote modernisation.

Development in the infrastructure of the country requires substantial investments. Incorporating the private sector can alleviate the shortfalls in quality related with the infrastructure sector. In addition to these things, steps has to be taken to streamline the process of getting clearance for the project and to ensure that it is carried out in a timely manner. It is possible for other states’ governments to follow the example set by the government of Tamil Nadu, which, acting on the advice of CREDAI, created a “single window” system to facilitate the acquisition of statutory pre-project clearances from a variety of Tamil Nadu authorities through a centralised location.

SOURCES:

Newer Quality Infrastructure Investment: An Overview
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Older Talent Shortage: One of The Most Significant Shortfalls in Indian Infrastructure Industry