The new government is likely to maintain continuity on major programmes launched during its last tenure: Bharatmala Pariyojana, Sagarmala, railway station redevelopment programme, inland waterways development, Namami Gange, Swachh Bharat Mission, UDAN, AMRUT and smart cities. The last five-year period (FY2014-FY2019) had witnessed huge spending on infrastructure segments such as roads (increased by ~353 per cent between FY2015 to FY2019), railways (increased by ~146 per cent times between FY2015 to FY2019), and metro-rail, which is likely to increase further over the next five years.
Taking cues from the BJP manifesto, ICRA expects transport infrastructure (roads, railways, metro, airport, ports and inland waterways) to remain the main focus area for the government. According to Shubham Jain, Vice President and Group Head, Corporate Ratings, ICRA, “The capital investment in the infrastructure sector has been proposed at Rs 100 trillion over the next five years, a huge increase from the current level of capital investment in the sector. Among key segments, transport infrastructure is expected to see a major jump with an estimated Rs 25-30 trillion of capital outlay.” He adds that construction companies are likely to be the major beneficiaries and will witness strong order inflows, estimated between Rs.15 and Rs.18 trillion on the basis of these infrastructure capex plans.
For the roads sector, the manifesto mentions constructing 60,000 km of National Highways over the next five years, at an average rate of 12,000 km per year. Given that the pace of highway construction has grown significantly over the past four to five years and is sizeable under implementation projects, the target seems achievable.
For Railways, the manifesto has proposed a conversion of all viable rail tracks to broad gauge, electrification of all railway tracks, and completion of the two dedicated freight corridor projects
(EDFC and WDFC) by 2022.
As for metro-rail infrastructure, the plan is to bring it to 50 cities from around 20 cities where metro-rail projects have been approved so far.
With regard to airport infrastructure, the target is to double the number of functional airports from around 101 at present. Similarly, port capacity is aimed to be doubled over the next five years and the Sagarmala project is to be fast-tracked.