New Delhi, Oct 24: The Union Cabinet Tuesday approved the largest every highway development programme, which includes developing and expanding roughly 83,000 km of roads with an investment of Rs. 6.9 lakh crore over a period of five years. The plan also includes the 28,400 km ‘Bharatmala’ project that aims to connect the border areas of the country with the mainland.
In addition, 1,837 km of expressways will also be developed under the programme approved by the Union Cabinet.
Aside from providing a boost to the country’s infrastructure, the project aims to set in motion economic activity as well as generate as many as 32 crore man days throughout the country by 2022. The emphasis of the project is to enhance the traffic flow speed on the vital corridors by providing standardised four-lane roads between two specific points. Majority of the proposed corridors are to be shorter as well as access-controlled for more rapid movement of cargo vehicles.
The Center plans to raise nearly half the fund required for the programme from the market, besides a major chunk from private investments. The remaining amount would come from the Central government roads funds and highway toll.
Poor road conditions, narrow width as well as congested points have resulted in a truck covering on an average 250-300 km daily in India compared to 700-800 km in developed countries.
Perhaps, this is perhaps the biggest announcement by the government announcement ahead of the upcoming assembly elections in Gujarat and few other states.
The transport ministry estimates that construction of 10,000 km of highways annually can generate four crore mandays and the proposed mega highway development programme can be utilized to counter allegations that the Modi government has failed to create any employment opportunity.
The Union government’s move is significant because it comes at a time when the pace of growth in Asia’s third-largest economy has become sluggish owing to a three-year low of 5.7 per cent in the second quarter of the current fiscal that ended June, which has left many experts to demand a need for an expansionary fiscal policy.
Nevertheless, enhancing government spending when tax collections are subdued and the economy is facing a sluggish growth has stressed federal revenues. This may, in turn, increase the fiscal deficit further than the targeted 3.2 per cent of GDP.
Already, there are signs that the Centre has very few options, but spending its way out of trouble which partially exacerbated due to shock withdrawal of high-value banknotes as well as disruptions ahead of the rollout of the new Goods and Services Tax (GST) last year.
Already, the National Highways Authority of India (NHAI) has prepared detailed project reports (DPRs) for the 10,000 km of the identified network that would facilitate faster roll out of projects. (PNN/Agencies)
