What the National Infrastructure Pipeline will need to regain momentum after COVID19 pandemic
The National Infrastructure Pipeline launched this year by the Finance Minister, Nirmala Sitharaman, is the framework on which the PM proposes to transform India into a $ 5 trillion economy by 2024. However, the COVED19 pandemic has disrupted the plans. The plan had envisaged a huge spike in spending in the financial years 2021-22 and 2022-23 when the spending would be to the tune of Rs 19.5 trillion and Rs 19 trillion respectively while a Rs 13.6 trillion investment has been proposed for 2020-21. Measures to contain the pandemic and to support the flagging economy may now consume the bulk of the attention this year although the government has been blessed with a windfall in terms of the oil price which has slipped to under $ 23 per barrel and already likely to save $ 7 billion during 2019-20 and may halve to $ 60 billion in FY 2020.
India’s PPP program has been time tested and has the potential to attract foreign investors especially with the tax inducements provided for sovereign funds. So our growth story has the potential to attract funding . However, we need to approach the world investors with a bagful of bankable fully incubated projects. All risks which arise due to land acquisition and permissions from innumerable authorities which ultimately delay, and derail projects should be mitigated during incubation.
Having discussed this with the panellists on the Construction World Webinar hosted on 31st March 2020 with panellists like Arun Goyal, former Secretary to Government of India, Raghav Chandra, former Chairman of National Highway Authority of India, Uma Shanker, former Secretary, Ministry of Power, Government of India and Vijay Agarwal , it was felt that the allocation for healthcare and education needs to be revised, Fear among bureaucracy that their decisions would be reviewed and vigilance departments would haul them up under the guise of inquiry committees seemed to have sapped the administrators of the initiative to manage projects like private entrepreneurs would. On the issue of procurement there did not seem to be a clear answer on how the ‘L1’ or lowest cost tendering method could be improved upon. However, strict pre-qualification processes can filter unqualified bids which derail the bidding process.
Judicial process for arbitration needs to be reviewed by instilling the obligation among the government departments to accept arbitration judgements without appealing against them unnecessarily.
Finally, there seemed to be a consensus that the COVID19 pandemic would pan out by end June as the economy limps back to normalcy.
The video for the webinar can be seen on the following link – Click Here. Further details can be read here.
- Pratap Padode, Founder, ASAPP Info Global Group, and Founder & Executive Director at FIRST Construction Council and Smart Cities Council India
