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Budget 2017: Experts Laud The Increase In Allocations For Highways And Rural Roads

The Union Budget increased allocations for roads and other infrastructure. This move has widely been praised by experts

Written By: Simar Singh | Edited By: Sonia Bhaskar | December 11, 2017 12:58 PM | Features

Budget 2017: Experts Laud The Increase In Allocations For Highways And Rural Roads

New Delhi: India’s network of roads and highways shoulder most of the country’s traffic, being the dominant means of travel in the country. According to the World Bank, over 85 per cent of passenger traffic and around 60 per cent of freight use this network, making these central to connectivity, mobility, and economic development. Highways bear a disproportionate burden of this traffic – carrying 40 per cent of the load while making up a mere 1.7 per cent of the total roads in the country. So when the Finance Minister, Arun Jaitley, announced that the allocation for highways would be increased by 11.9 per cent from 57,976 crores to 64,900 crores in today’s Budget presentation, it was largely seen as a welcome move.

Also Read: Union Budget 2017: Allocation For Highways Increased To Over 64,000 Crores

Union Minister of Law and Justice Ravi Shankar Prasad tweeted, “Rail, road, and airports- development of infrastructure got a big boost in this budget.”

“The increased in spend on road and rail is a welcome move,” said Manish Agarwal, Partner and Leader Infrastructure, PwC.

Reiterating the same view, Vinayak Chatterjee, Co-Founder, Feedback Infra and Chairman of the Confederation of Indian Industry’s (CII) National Committee on Infrastructure, told NDTV, “The infrastructure sector is pretty happy. The budget is directionally correct and the good thing is that the funds are being allocated to a lot of ongoing programmes that look at the development of highways, rural roads, railways, etc.”

In totality, the transport sector which includes roads, shipping and railways have been allocated 2,41,387 crores.

Rural Connectivity

In his speech, Mr Jaitley stated that the roads, including those built under the Pradhan Mantri Gram Sadak Yojna (PMGSY), from FY2014-2015 till now, was around 1,40,000km. This, he said, was significantly higher than the previous three years. He further added that “the pace of construction of PMGSY roads has accelerated to reach 133 km roads per day in 2016-17, as against an average of 73 km during the period 2011-2014”.

Poor road connectivity in rural areas is widely regarded as a big impediment to India’s economic growth. Taking cognisance of this, the Budget this year has allocated 19,000 crores to the PMGSY and with contributions from the states, this figure is expected to rise to 27,000 crores.This scheme had been launched in 2000 by the Atal Bihari Vajpayee administration and the current government now aims to complete it by 2019.

Efficiency and Economic Boost

A recurring theme throughout today’s Budget speech was the government’s focus on transparency and efficiency and this extended to the transport sector. While reiterating the need to digitise transactions and grievance handling, the Finance Minister also announced that the road transport offices will be one of the government institutions to build digital payment infrastructure.

“The major plans as outlined by the Finance Minister on infrastructure development will help improve the service quality as well as bring in greater efficiency in the operations of our roads and highways,” said Pankaj Patel, President, FICCI.

In terms of economic growth, the continued focus and increased spending on roads and other infrastructure are considered as good moves.

“This magnitude of investment will spur a huge amount of economic activity across the country and create more job opportunities,” Mr. Jaitley had said during his presentation, speaking about the allocation which had been announced for the transport sector.

ICICI Bank’s CEO and MD, Chanda Kochhar, in a statement said that the Finance Minister had rightly prioritised investment in infrastructure and that the increase in capital spending and the proposals for investment in areas like roads and railways “would not only have a multiplier impact on other sectors of the economy but also enhance employment generation and make the growth inclusive.”

“Increased investments in railways and road infrastructure will facilitate interstate trade while lowering the cost of operations for merchants.” explains Sashank Rishyasringa, Co-founder and Managing Director, Capital Float, an online lending company.

It is no secret that roads are an integral part of any successful growth story and hopefully the announcements in this Budget will translate into an essential on-ground boost to the growth of road infrastructure across India.

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