Economics Prelims cum Mains

Task Force on National Infrastructure Pipeline presents its Final Report

In News

  • The Task Force on National Infrastructure Pipeline (NIP) has submitted its Final Report on NIP for FY 2020-25 to the Union Minister for Finance & Corporate Affairs.
  • The task force was set up after the Prime Minister, in his Independence Day speech last year, highlighted Rs 100 lakh crore worth of infra investment over the next five years to make India a $5 trillion economy.
  • The Summary Report of the Task Force on National Infrastructure Pipeline had already been released by the Finance Minister in December, 2019.
  • The summary report had pointed that critical step in addressing decreasing private sector participation in infrastructure can be institutionalizing dispute resolution mechanism to efficiently resolve disputes related to PPP projects.
  • It further stated that investments must be made in the institutions created under The Commercial Courts Act 2015, The Specific Relief (Amendment) Act 2018 and the New Delhi Arbitration Centre Act 2019 for speedy resolution.

 

National Infrastructure Pipeline

  • NIP is a first-of-its-kind, whole-of-government exercise to provide world-class infrastructure across the country, and improve the quality of life for all citizens.
  • It aims to improve project preparation, attract investments (both domestic and foreign) into infrastructure, and will be crucial for target of becoming a $5 trillion economy by FY 2025.
  • The Final Report of NIP Task Force has projected total infrastructure investment of Rs 111 lakh crore during the period FY 2020-25. While Centre and states are expected to have almost equal share in implementing NIP, private sector contribution is expected around 21 per cent.
  • The NIP captures all projects — greenfield or brownfield, under implementation or under conceptualisation — costing greater than Rs 100 crore per project.
  • Out of the total expected capital expenditure of Rs 111 lakh crore, projects of Rs 44 lakh crore (40 per cent of NIP) are under implementation, projects worth Rs 33 lakh crore (30 per cent) are at conceptual stage and projects worth Rs 22 lakh crore (20 per cent) are under development.
  • Of the total project capital expenditure, sectors such as energy (24 per cent), urban (17 per cent), railways (12 per cent) and roads (18 per cent) are expected to contribute nearly 70 per cent of the infra investments in India.

 

Recommendations

  • In addition to updating existing sectoral policies, the Final Report also identifies and highlights a set of reforms to scale up and propel infrastructure investments in various sectors throughout the country.
  • Aggressive push towards asset sales, monetisation of infrastructure assets, setting up of development finance institutions and strengthening the municipal bond market are some measures suggested to boost infrastructure investments.
  • Further, the Task Force has recommended for three Committees be setup:
    • A Committee to monitor NIP progress and eliminate delays;
    • A Steering Committee in each Infrastructure ministry level for following up implementation; and
    • A Steering Committee in Department of Economic Affairs for raising financial resources for the NIP.

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