New Delhi:
India’s infrastructure has improved significantly in recent years, highlights a Morgan Stanley report.
The report notes that India’s infrastructure competitiveness has historically been hampered by poor infrastructure. However, recent improvements and government initiatives such as ‘Gati Shakti’ show great promise for further progress.
“India’s infrastructure has improved materially in recent years, and there is significant scope for future improvements through recent government initiatives such as the Prime Minister’s Gati Shakti (PMGS),” the report states.
Over the past decade, the report says India has significantly increased its infrastructure spending, with a strong focus on expanding and modernizing its physical assets.
The report also highlighted that when comparing the scale of infrastructure relative to GDP, India compares favorably with China, which is often considered the benchmark for large-scale infrastructure development.
The various ministries of the Government of India have initiated long-term sector-specific infrastructure plans to further improve various segments of the economy.
These include ‘Bharatmala’ for road development, ‘Sagarmala’ for port connectivity, Power for All and waterways development programme.
According to the report, “This marginally helps products move faster and at a more affordable cost than in the past,” illustrating the tangible benefits of these initiatives.
Looking ahead, the report projects a steady rise in India’s infrastructure investment. It is expected to increase from 5.3 percent of GDP in fiscal year 2024 (F24) to 6.5 percent in fiscal year 2029 (F29). This increase indicates a strong compound annual growth rate (CAGR) of 15.3 percent, which will result in cumulative spending of $1.45 trillion over the next five years.
In the current fiscal year, India’s GDP is 19 percent of China’s. China has long been recognized for its heavy investments in infrastructure, providing unparalleled scale, size and efficiency. However, the report indicates that India’s physical infrastructure is not significantly behind that of China when considering the size of their respective economies.
While there may be visible differences in efficiency and quality, the report mentions that India’s ongoing and planned investments signify progress and potential for further development.
As India continues to develop its infrastructure, it is poised to make significant progress, positioning itself favorably in the global context.
(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated channel.)