Is National Infrastructure budget key in promoting industrial growth?

Prepared by – Arshdeep Singh

Roll no. – 140423465

INTRODUCTION

India has re-emerged as one of the fastest growing economies

in the world.

Development of industries have contributed to national

income and per capita income.

Improved infrastructure leads to expansion in productivity

and industrial growth.

But still there is a need for improvement of each sector and

to meet the growing demand of industries, the investment

to be raised from the present 4.5 percent of GDP to 8 percent

of GDP in the 12th five year plan.

ROADWAYS

RAILWAYS

AIRPORTS

TELECOMS

PORTS AND HARBOURS

INFRASTRUCTURE BUDGET PLAN AND ITS NEED

Necessary to be made for maintaining National Infrastructure.

Prepared by Budget Division of Department Of Economic Affairs of The Ministry Of Finance.

An estimate of costs, revenues, and resources over a specified period.

Includes Supplementary excess grants.

Helps by forcing managers to handle unfavourable conditions and what steps to be taken.

PURPOSE OF A BUDGET PLAN

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•Reduction in future costs.

•Improving the transport system.

•Promoting the growth of various industries.

•Meeting the challenges of the climate change.

•Increase the productive capacity of economy by expanding infrastructure provisions.

•Investing in public service infrastructure.

•Improving urban amenities.

•Establishing a health system to serve the needs of the next decade.

INFRASTRUCTURE BUDGET 2014

A rendering of the planned 'smart city' Dholera, in southern Gujarat, India.

•Rs.37,850 crore allocated for road building plan via NHAI – National Highway Authority of India, including Rs.3000 crore for the North-East.

•Rs.11,635 crore to develop existing ports and harbours.

•12 major ports and 200 non-major ports.

•95% of India’s exports and imports to be moved by sea.

•Schemes for development of airports via. AAI – Airport Authority of India.

•Rs. 7,060 crore for Smart Cities.

• Entire project to be finished by 2020.

• world class infrastructure.

• Cities outfitted with High-Tech communication capabilities.

•Availability of optical fibre network and next generation infrastructure.

VARIOUS GROWTH INDICATORS OF SMART CITIES

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INDIAN RAIL BUDGET

Presented by Mr. D.V. Sadananda Gowda, Union Minister for Railways. Targets to make Indian Railways the largest freight carrier of the world. Bullet train proposed on Mumbai – Ahmadabad sector. Targets to growth and easy transport facilities for Industrial goods and fuels . Diamond quadrilateral network to connect major metros through High Speed Rails. Increased speed of trains from 160 km/hr to 200 km/hr. Funds worth Rs. 100 cr allocated to High Speed projects. 23 projects underway in the North-East. Doubling and extending of previous lines. E- Ticketing to support 7,200 users per second. Provision of Road-Over-Bridges and Road-Under-Bridges.

•Presented by Mr. D.V. Sadananda Gowda, Union Minister for Railways.

•Targets to make Indian Railways the largest freight carrier of the world.

•Bullet train proposed on Mumbai – Ahmadabad sector.

•Targets to growth and easy transport facilities for Industrial goods and fuels.

•Diamond quadrilateral network to connect major metros through High Speed Rails.

•Increased speed of trains from 160 km/hr to 200 km/hr.

•Funds worth Rs. 100 cr allocated to High Speed projects.

•23 projects underway in the North-East.

•Doubling and extending of previous lines.

•E- Ticketing to support 7,200 users per second.

•Provision of Road-Over-Bridges and Road-Under-Bridges.

BUDGET PLAN FOR POWER AND ENERGY

Rs. 500 crore for solar power projects

Rs. 100 crore for ultra-modern coal based thermal power technology.

Development of hydro-power projects.

Provision of Natural Gas based turbines at load centres.

AVIATION PLAN

Schemes for the development of new airports under AAI.

Proposed introduction of a program for Electronic Travel Authorisations (e-visas) at 9 Airports.

Increased budgeted investments in public sector enterprises, including air India budgeted at Rs. 7,069 Crores

PLAN FOR AGRICULTURE

Rs.100 crore for agri-infrastructure funds.

Farmers to get loans at 7%.

Government to formulate New Urea Policy.

Rs. 50 crore for indigenous cattle breeding.

Rs. 100 crore for Kissan Television.

BUDGET PLAN FOR TELE-COMMUNICATIONS

Proposed a Pan India programme “Digital India”to ensure broadband connectivity in rural areas.

Rs. 500 crore allocated for improvement of IT sector.

Provision of high speed internet in all industrial sectors for online working facilities.

PROFILE OF INDIA’S PHYSICAL INFRASTRUCTURE

Hardware components grew slowly in the last few decades.

Road sector provided wider access than the railways sector.

Software part performed well to maintain faster growth of the economy.

Hardware components needs utmost attention.

Requirement of high investment potentials in transport and power sector.

INDUSTRIAL GROWTH

.

Industrial Developme

nt

Greater Productivi

ty

High Investm

ent

Greater Per Capita

Income

Greater National Income

PROMOTED INDUSTRIES BY 11TH FIVE YEAR INFRASTRUCTURE PLAN

PETROLEUM AND CHEMICAL INDUSTRY

• Major contributor to India’s industrial GDP.

• Both contribute 34% of its export earnings.

• India has become one of the top 5 producers of petrochemical products.

• 100% FDI allowed in many segments of this sector.

• Oil and gas sector attracts both domestic and foreign investment.

• India had total reserves of 1354.76 billion cubic metres of natural gas.

• 758.25 million tonnes of crude oil by the end of FY 2012-2013.

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ENGINEERING INDUSTRY

• Largest sub-sector of India’s industry GDP.

• Third largest foreign exchange earning sectors for the country.

• Currently employs about 4.5 million workers.

• Sector exported $67 billion worth of engineering goods in 2013-2014.

• India has become world’s largest producer of tractors.

• Sector accounts for about 20% of India’s total exports.

• Sector manufactured about 20 million passenger and utility vehicles in 2013.

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TELECOM INDUSTRY

• World’s most competitive and fastest growing market.

• Industry has grown 20 times in just ten years.

• Internet user base stood at 190 million at the end of June 2013.

• World’s second largest mobile phone user base with over 930 million users in 2013.

• Total revenue grew by 7 percent to Rs. 2382 billion for 2011-2012 financial year.

• India’s telecom network has lowest call tariffs in the world.

• National Optical fibre Network, a project to ensure broadband connectivity to rural areas.

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TEXTILE INDUSTRY

• Contributes about 4 percent to the country’s GDP.

• Transformed from a declining sector to rapidly developing one.

• Total investment into textiles increased by 27 billion dollars.

• Providing employment to 45 million people of India.

Increase in India’s global exports of textile items

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POWER AND ENERGY INDUSTRY

• India has became the third largest producer of electricity .

• India has 4.8% global share in electricity generation.

• Total annual generation of electricity from all sources was 1102.9 TeraWatt hours in 2013.

• Coal fired plants account for 59% of India’s installed electricity.

• India receives highest solar radiations of energy 5,000 trillion kWh every year.

• Fifth largest installed wind power capacity in the world.

MINING INDUSTRY

• India’s mining industry is fourth largest producer of minerals.

• Contributes 3% of its GDP.

• High growth rate in coal mining till 2013, still high in production.

Coal Mining in India – Total Production by grade – Bituminous and Lignite (Million Tonnes)

. TOURISM INDUSTRY

• Contributes more to India’s GDP than textile industry.

• India attracted 6.85 million international tourist arrivals in 2013.

• Steady growth from 4.45 million tourist arrivals in 2006 to 7 million in 2013.

• Combined International and domestic tourism contributes 5.93% of India’s GDP.

• Contributes 9.3% to its employment.

• Fast growing medical tourism offering low cost health and long term care.

INDUSTRIAL CONTRIBUTION TO EMPLOYMENT

•Increase in industrial growth provides job opportunities to unemployed people.

•Maximum credit goes to technology sector and agriculture sector.

•Technology sector contributes about 20.1% job growth in IT, cyber infrastructure and telecommunication.

•Health and medical industry provides wider scope of career to new comers.

•Contributes about 9.5% of the total job growth among all other industries.

• Other contributers are engineering industry, science and biotechnology, oil and gas industry, Hospitality and tourism and many other manufacturing industries.

CONCLUDING REMARKS

Industrial growth requires high investment in infrastructure sector.

Provision of quality infrastructure is essential to realize full potentials of Indian industry.

Tremendous change in industrial growth by 11th Five Year budget Plan .

Hence, National infrastructure budget acts as a key in promoting industrial growth.

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THANK YOU!!