Funding National Infra Pipeline would be a ‘challenge’: Economic Survey 2019-20

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News:According to Economic Survey,funding of the Rs 102 lakh crore National infrastructure pipeline(NIP) unveiled by the Indian government would be a challenge.

Facts:

About National infrastructure pipeline(NIP):

  • Government had constituted a task force headed by Secretary, Department of Economic Affairs to draw up a National Infrastructure Pipeline(NIP) from 2019-20 to 2024-25.
  • The task force has unveiled the National Infrastructure Pipeline(NIP) with projects worth ₹102-lakh crore.
  • The private companies will account for 22%-25% of the investments and the balance will come from the Centre and the states in equal proportions.
  • The projects have been classified under two broad categories namely economic infrastructure and social infrastructure for both ease of doing business and ease of living.

Economic Survey on NIP:

  • The pipeline can create well prepared infrastructure projects that will create jobs, improve ease of living and provide equitable infrastructure access to make growth more inclusive,.
  • However,raising funds for the pipeline over the next five years will be a challenge.
  • The survey has indicated that huge investments in infrastructure due to NIP may lead to a high fiscal deficit which may increase bond yield thereby possibly crowding out private investment.
  • Further,the survey has also called for the use of next generation infrastructure which will adopt physical infrastructure and technology like Internet of Things and automation together to maximise the efficiency of physical infrastructure.