AMITY LAW SCHOOL

INDIAN ECONOMY PSDA

TOPIC – WHAT ARE THE MAJOR CHANGES IN INFRASTRUCTURE
SINCE YEAR 2000 IN INDIA AND EXAMINE ITS ROLE IN INDIA’S
ECONOMIC DEVELOPMENT?

SUBMITTED TO – DR. PRADEEP MEHTA

SUBMITTED BY – TARAB KHAN
SHAMBHAVI MISHRA
ITISHA SINGH
GAUTAMI GUPTA
HARDIK
YUSUF
TITLE: INFRASTRUCTURE DEVELOPMENT IN INDIA SINCE 2000
AND ITS ROLE IN ECONOMIC DEVELOPMENT
ABSTRACT
The development of a nation's infrastructure is essential to its economic progress and advancement.
Since 2000, India's infrastructure has seen substantial alterations that have both altered the country's
landscape and aided in its economic growth. This in-depth examination looks at the significant
infrastructural upgrades that have occurred over the last 20 years and how they have affected India's
economic development and growth. The article addresses important industries like energy,
telecommunications, urban infrastructure, and transportation while stressing the potential and
problems that have arisen.

INTRODUCTION
Any economy is built on its infrastructure, which provides the fundamental facilities and mechanisms
required for a society to run smoothly. Transportation, energy, telecommunications, water supply,
sanitation, and urban development are just a few of the many industries it covers. A nation's economic
development is directly impacted by the quality and sufficiency of its infrastructure, which also affects
commerce, productivity, and general well-being.

• Infrastructure can be categorized into two main types:

 Hard infrastructure

 Soft infrastructure.

HARD INFRASTRUCTURE:
The term "hard infrastructure" describes the real, physical parts of infrastructure systems. Large-
scale, capital-intensive projects and infrastructure that are crucial to the nation's development and
daily operations are typically involved. Robust communication networks, waste management and
disposal services, public transport, power, etc. are a few instances of physical infrastructure.

SOFT INFRASTRUCTURE:
The non-profit components that are essential to human activity and economic development make up
soft infrastructure. Its main objectives are the integration, management, and training of the nation's
infrastructure. Law enforcement, financial services, and education accessibility are a few examples of
soft infrastructure.

2. BACKGROUND HISTORIES
India's post-independence period, during which the nation set out on a path of industrialization and
modernization, is when the country's infrastructure development journey began. But for a number of
decades, the development of infrastructure progressed relatively slowly and frequently fell short of the
population's increasing demands.
India only started to accelerate its efforts to develop its infrastructure in the late 20th and early 21st
centuries. This change was influenced by a number of factors, such as growing middle class demands
for higher living standards, increased foreign direct investment (FDI), and economic liberalisation. An
important milestone in the development of infrastructure was reached in 2000 when the government
unveiled the National Highways Development Project (NHDP), which aims to modernise and enhance
the country's highway system.

3. TRANSPORTATION INFRASTRUCTURE
1) ROAD TRANSPORT
One of the most visible and critical aspects of infrastructure development in India has been in the road
transport sector. Since the year 2000, the country has witnessed a remarkable expansion and
improvement in its road network, primarily through the NHDP and other state-level initiatives.

The NHDP aimed to upgrade and expand India's national highway network, which is crucial for the
transportation of goods and passengers. It was implemented in multiple phases, and its success has
led to a substantial increase in the length and quality of national highways. As of my last knowledge
update in 2022, over 22,000 kilometers of national highways had been constructed under this project.

Motorways like the Golden Quadrilateral, the North-South and East-West Corridors, have greatly
lowered travel times and transportation costs, which has increased commerce and economic activity.
Because these motorways improved connection between major cities and ports, they revolutionised
the logistics and manufacturing industries.

3.2 RAIL TRANSPORT

One of the greatest rail networks in the world is found in India, and it is run by Indian Railways.
Despite having a long history, it has long struggled with capacity issues, antiquated technology, and a
lack of funding. But since 2000, there have been significant advancements in rail transit

The introduction of high-speed rail projects, station refurbishment, and railway line electrification have
all been major undertakings in the rail industry. When it was first introduced in 2002, India's urban rail
system reached a critical turning point with the Delhi Metro, which has subsequently been emulated in
other big cities.

It is anticipated that the creation of dedicated freight corridors will transform rail freight transit,
boosting productivity and cutting expenses associated with logistics. Among the noteworthy instances
are the Eastern Dedicated Freight Corridor (EDFC) and Western Dedicated Freight Corridor (WDFC)
projects, which are designed to increase freight capacity and relieve traffic on the current rail
networks.

3.3 AIR TRANSPORT

Since 2000, India's aviation industry has grown remarkably. The Indian populace now has greater
access to air travel thanks to the liberalisation of air travel regulations, the rise of low-cost airlines, and
the development of airport infrastructure. A major factor in meeting the growing demand for air travel
has been the development of new airports and the renovation of old ones.
In addition to improving internal connectivity, the development of greenfield airports in places like
Hyderabad, Bengaluru, and Delhi as well as the expansion of already-existing international airports
have established India as a major aviation centre worldwide. The goal of introducing regional
connectivity programmes like the UDAN (Ude Desh ka Aam Nagrik) initiative is to lower the cost of air
travel and increase accessibility to underserved areas of the nation.

4. ENERGY INFRASTRUCTURE
4.1 POWER GENERATION
Any economy's ability to function depends on its energy infrastructure, and India has achieved great
progress in this area since 2000. India's power generation capacity has increased significantly,
resolving past shortages and providing the groundwork for future industrial and economic growth.

A major step towards boosting power producing capacity was the start of the Ultra Mega Power
Projects (UMPPs). Power deficits have decreased as a result of these efforts, which sought to build
sizable, effective power plants. In India, the growth of renewable energy sources—particularly solar
and wind power—has accelerated, and the country has set high goals for its clean energy potential.

The enactment of the Electricity Act of 2003 resulted in regulatory changes and promoted private
sector involvement in the production and distribution of electricity. This assisted in decreasing
inefficiencies and raising the standard of the power source.

4.2 RURAL ELECTRIFICATION

One other notable accomplishment in the energy industry is the programme for rural electrification.
The rate of electrification in rural areas has significantly increased as a result of the government's
commitment to supplying power to every hamlet in the nation. Programmes such as the Pradhan
Mantri Sahaj Bijli Har Ghar Yojana (Saubhagya) have been instrumental in accomplishing this
objective.

Rural electrification has raised living standards for residents while also opening doors for economic
growth because many small-scale enterprises and industries depend on electricity for operation.

5. TELECOMMUNICATIONS INFRASTRUCTURE
Since the early 2000s, India's telecom industry has undergone a revolution. The nation's
telecommunications network was constrained before this time, with low teledensity and inadequate
connectivity in remote areas.

5.1 MOBILE REVOLUTION

In India, the introduction of mobile phones changed everything. The number of mobile subscribers
increased quickly as a result of the introduction of mobile services and a competitive market. The
widespread availability of reasonably priced mobile phones and inexpensive tariff plans has increased
public accessibility to communication.
The digital divide was closed and people in rural and distant locations could now access information,
services, and employment possibilities thanks to the growth of mobile networks in these places.
Mobile technology revolutionised the way business is done in the nation by playing a significant role in
sectors including e-commerce, mobile banking, and agriculture.

5.2 BROADBAND AND INTERNET

In India, the expansion of broadband services and the internet have both been substantial. High-
speed internet access made possible by the advent of 4G and then 5G technology has encouraged
innovation and digital enterprise. The goal of e-governance programmes like Digital India was to
expedite the adoption of internet technology by offering government services online.

The usage of social media, e-commerce sites, and online education has increased as a result of the
widespread availability of smartphones and reasonably priced data plans. The COVID-19 epidemic
highlighted the need for a strong internet infrastructure as telemedicine, online learning, and remote
work became essential for day-to-day living.

6. URBAN INFRASTRUCTURE
Over the past few decades, India has seen a notable trend of urbanisation as a large percentage of
the population has moved to cities in quest of better prospects. In order to deal with increased
urbanisation, the nation has made investments in enhancing urban infrastructure.

6.1 SMART CITIES

The goal of the 2015 introduction of the Smart Cities Mission was to turn metropolitan areas into
technologically sophisticated, efficient, and sustainable cities. Numerous cities have started projects
to enhance waste management, transportation, urban infrastructure, and general quality of life under
this effort. By improving citizens' living and working conditions and drawing investments, the creation
of smart cities directly affects economic growth.

6.2 HOUSING AND REAL ESTATE

The building industry has expanded significantly along with the real estate sector. Demand for new
homes was fueled by government programmes like the Pradhan Mantri Awas Yojana (PMAY), which
attempted to give the impoverished in both urban and rural areas access to cheap housing. In addition
to being a major driver of the economy, the real estate market serves as a barometer of people's
goals and levels of living.

7.CHALLENGES AND THE WAY FORWARD

Even if India's infrastructure has developed remarkably, the country's economic prosperity must be
sustained and further enhanced by addressing a number of issues.

7.1 FUNDING AND FINANCING

A significant obstacle is the requirement for large amounts of finance for infrastructure improvements.
Public-private partnerships, or PPPs, have become more significant even while government funding
has remained the main source. Due to complicated regulations, problems with land acquisition, and
worries about financial feasibility, attracting private sector investments for long-term projects continues
to be difficult.

7.2 SUSTAINABILITY AND ENVIRONMENTAL CONCERNS

India needs to address environmental issues and sustainability as it develops and upgrades its
infrastructure. A move towards greener and more sustainable energy sources is required to meet the
nation's expanding energy needs. Long-term economic and environmental well-being depends on
striking a balance between infrastructure development and environmental conservation.

7.3 REGIONAL DISPARITIES

Infrastructure development in India has been unequal, with discrepancies between urban and rural
areas, as well as between states. It is difficult to ensure fair access to infrastructure, and specialised
measures are required to alleviate regional differences.

7.4 REGULATORY REFORMS

The regulatory framework in India can be complex and bureaucratic, resulting in infrastructure project
delays and cost overruns. To encourage more private investment, the country must streamline rules
and improve the ease of doing business.

7.5 MAINTENANCE AND OPERATION

While the focus has largely been on building new infrastructure, there is a need for equal attention to
maintenance and efficient operation. Neglecting maintenance can lead to infrastructure deterioration
and increased costs over time.

8. ECONOMIC IMPACT OF INFRASTRUCTURE DEVELOPMENT

Changes and improvements in India's infrastructure have had a significant impact on the country's
economic progress. Here are some of the most important characteristics of this impact:

8.1 BOOSTING PRODUCTIVITY

Improved infrastructure, particularly in transportation and energy, has increased supply chain
efficiency, lowering transit costs and time. This, in turn, has a direct impact on industry
competitiveness. The reduction in logistics costs has increased the competitiveness of Indian
products in international markets.

8.2 ATTRACTING INVESTMENTS

Domestic and foreign investors have flocked to modern infrastructure, notably in urban regions and
special economic zones. Because it decreases operating costs and risks, industries are more likely to
establish industrial units or offices in regions with solid infrastructure.

8.3 ENHANCING LIVELIHOODS

People's lives in remote locations have improved as a result of rural electricity and road connectivity.
Access to energy and mobility has increased economic potential for small companies, agribusinesses,
and cottage industries.
8.4 REDUCING POVERTY
Infrastructure development helps to alleviate poverty by expanding income-generating options and
improving living circumstances. Rural development initiatives, in particular, have a direct impact on
poverty reduction in India.

8.5 URBANIZATION AND EMPLOYMENT

Development of urban infrastructure not only promotes urbanisation but also produces jobs in the
construction, real estate, and service industries. Urban areas become economic activity and job hubs,
luring migration from rural areas.

8.6 SUSTAINABLE GROWTH

The emphasis in infrastructure development on clean energy and sustainable practises corresponds
with global environmental goals. By decreasing environmental hazards and boosting the country's
reputation as a responsible global actor, sustainable infrastructure contributes to long-term economic
success.

8.7 CONNECTIVITY AND TRADE

Improved transportation infrastructure, including road, rail, and air networks, has increased connection
both inside and between countries. This has increased local and international trade, opening up new
prospects for firms and industries.

9. CONCLUSION
Since the year 2000, infrastructure development in India has been a revolutionary journey, with
significant changes and advances in numerous areas such as transportation, electricity,
telecommunications, and urban infrastructure. These innovations have been critical to the country's
economic growth and development, increasing productivity, attracting investments, reducing poverty,
and improving quality of life.

While India has achieved significant progress, it continues to face funding, sustainability, regional
inequities, regulatory reforms, and maintenance difficulties. Addressing these issues is critical to
maintaining and expanding the economic benefit of infrastructure development in India.

As of our most recent knowledge update in 2022, India's infrastructure development is still evolving,
with new projects and policies being implemented. It is essential that you reference the most recent
government reports, academic research, and news sources to fully comprehend the current state of
infrastructure in India and its impact on economic development. India's infrastructure development
path is projected to remain a crucial component in the country's economic growth and global
competitiveness.