Morgan Stanley recently praised India’s PM Gati Shakti scheme in a report, noting significant infrastructure advancements over the past decade. The report highlights increased and more targeted investments, suggesting a continued emphasis on infrastructure spending in India’s future.
The report said, “We expect India’s infrastructure investment to steadily increase from 5.3 percent of GDP in F24 to 6.5 percent of GDP by F29. Indeed, this implies that infrastructure investments are expected to register a strong 15.3 percent CAGR, resulting in cumulative spending of USD 1.45 trillion over the next five years. In our view, this will help to lift the investment rate, leading to a sustained period of high productive growth.”
Based on the report, India’s physical infrastructure scale is quite comparable to China’s, especially when considering the difference in GDP between the two countries, which contrasts with common beliefs.
The PM Gati Shakti scheme has boosted infrastructure development and multi-modal connectivity. According to the 2023 World Bank Logistics Index Report, India’s average Container Dwell Time was three days, compared to four days in the UAE and South Africa, seven days in the USA, and 10 days in Germany.
In addition, Indian Ports “turnaround time” has reached 0.9 days, which is better than the USA (1.5 days), Australia (1.7 days), Singapore (1.0 days), etc. 6. In F24, ports’ overall cargo growth was 7 percent, with 53 percent of cargo handled by major ports (government-owned).
Under the PM Gati Shakti scheme, initiatives are showing results. Currently, 101 projects totaling Rs 609 billion have been identified for implementation in the ports and shipping sectors. As of April 2023, 26 projects worth Rs 89 billion have been completed, with 42 projects worth Rs 153.4 billion under development, and 33 projects worth Rs 366.4 billion under implementation.
The Ministry of Ports, Shipping, and Waterways (MoPSW) is overseeing projects totaling Rs 205.4 billion set for completion by December 2023. Additionally, under the Sagarmala program, 220 projects valued at Rs 1.12 trillion have been finished, with 231 projects worth Rs 2.21 trillion currently underway and 351 projects totaling Rs 2.07 trillion in the evaluation phase. Development has commenced on 13 out of 26 viable National Waterways.
In October 2021, PM Narendra Modi launched the PM Gati Shakti National master plan, a digital platform integrating 16 ministries including Railways and Roadways. It aims to coordinate infrastructure projects for seamless connectivity across roads, railways, airports, ports, mass transport, waterways, and logistics, facilitating integrated movement of people, goods, and services.
