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3 Priorities In The Infra Agenda
Pune: Saturday, May 7th, 2016
Vinayak ChatterjeeBy
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“You and I come by
road or rail, but
economists
travel on
infrastructure !” Margaret Thatcher
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THE THREE PRIORITIES
A: GCFI (Gross Capital Formation In Infrastructure)
B: A National Market For Electricity
C: PPP Revival
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2002
4.8%
9.0%
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
5.6%
10th Plan Average5.0%
11th Plan Average7.1%
12th Plan Expected Average
8.3%
11th Plan Expectation
(% o
f GD
P)
10th Plan Actual12th Plan
Projection
[Source: Erstwhile Planning Commission]
6.26%
7.32%6.81%
8.41%
6.51%7.40% 7.69%
8.08%8.58%
Gross Capital Formation in Infra as % of GDP
3.0%
His
tori
cally
The “Infra Deficit”
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?3 YEARS NOW WITH NO VISIBILITY
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INVESTMENTS IN INFRA : 10TH, 11TH AND 12TH PLANS
Eleventh Plan
(2007 - 12)
Twelfth Plan (2012 - 17)
Actuals(April, 2012 – March, 2016)
Achievement at Current Prices*
Projection*
Grand Total (₹ Lac Crores) 23.86 56.32 ?Grand Total (US $ Billions) 477@ 1126@ ?Investment as % of GDP 7.1 8.3 ?Share of Public Expenditure 63% 52% ?Share of Private Capital 37% 48% ?*₹ Lakh Crore at Current Prices; @50₹ = 1US$Source: Erstwhile Planning Commission – 12th Plan Document
PUBLIC AND PRIVATE INVESTMENTS ARE A HUGE CONCERN
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ESTIMATES INDICATE 30% SHORTFALL
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B: A NATIONAL MARKET FOR ELECTRICITY
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C: PPP REVIVAL
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WAKE-UP CALL FOR PPP VERSION 2.0
Finance Minister - Mr. Arun Jaitley announced
₹500 Crore for 3P India in the Union Budget :
July, 2014
Dr. Vijay L. Kelkar
Committee on “Revisiting and Revitalizing the
PPP Model of Infrastructure Development”
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• Reset Risk Allocation
• Create truly Independent Regulators
• Create a Renegotiation Commission
• Resources for Long-term Investments
• Receiving All Critical Permissions before bid-out: “Plug
and Play.”
THE 5Rs OF A PPP REVIVAL
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“The significance of a man is not in what he attains, but rather what he longs to attain.”
- Kahlil Gibran
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