Samantha Amerasinghe delves into what’s needed to achieve superpower status

Infrastructure development is critical to India’s development; it will be the elixir for pushing it higher up the ranks of the world’s largest economies to economic superpower status. In the light of the country’s recent general elections, infrastructure gained importance and became a high priority for the government.

A key tenet of Prime Minister Narendra Modi’s election campaign agenda was to steer the country’s rapid economic expansion through infrastructure led development.

During his decade in office, India’s economy rose four places in the rankings of the world’s largest economies. Its economy, which was worth US$ 3.7 trillion last year, was the fifth largest on the planet – and the subcontinental giant is comfortably placed to expand at an annual rate of at least six percent in the years ahead.

Experts argue that if New Delhi wants to achieve economic superpower status, it should be targeting growth of eight percent or more.

As India continues on its path to becoming a global economic powerhouse, the need for robust infrastructure has become increasingly apparent. Sustained expansion of infrastructure could propel India to No. 3 on the globe’s economic pecking order – behind only the US and China – by 2027.

India is following in China’s footsteps; it is emulating what Beijing did more than three decades ago by spending billi­ons on building roads, ports, airports and railways, in an infrastructure transformation that’s geared to drive economic growth and national development.

Furthermore, India is being widely seen as an alternative to China for countries and businesses that are looking to diversify their supply chains. Under Modi’s leadership, the country seems well positioned to offer investors and consumers an alternative to China in their search for growth, and manu­facturers who are looking to reduce supply chain risks.

So it wasn’t surprising when the Bharatiya Janata Party’s (BJP) manifesto pledged to sustain the momentum of the infrastructure push.

In this year’s federal budget alone, 134 billion dollars was carved out for capital spending to boost economic expansion. New Delhi added nearly 55,000 kilometres to its national highway network (a 60% increase in the overall length) between 2014 and 2023.

The government’s ambitious targets include the construction of over 5,000 kilometres of railway tracks annually and the development of 15,000 kilometres of access controlled highways.

There’s also an emphasis on electric vehicle (EV) charging infrastructure and a renewed commitment to green initiatives, encompassing the goal of achieving 500 GW of renewable energy, advancing the Green Energy Corridor project and ramping up green hydrogen production.

New Delhi is focussing on public-private partnerships (PPPs) since collaboration between the government and private sector is essential for creating resilient ‘future ready’ infrastructure.

PPPs have brought in much needed investments, innovation and efficiency, while ensuring sustainability and inclusivity. They have helped bridge the financing gap while fostering competition and technological advancements, and promoting best practices in project execution.

Interestingly, India’s resolve to be more self-reliant through its ‘Make in India’ campaign stemmed from the COVID-19 pandemic and subsequent challenges to the supply chain. Disruptions to the logistics sector compelled the nation to expand and modernise its manufacturing capabilities, and focus on infrastructure development.

One of its major initiatives is Gati Shakti, which is also known as the National Master Plan for Multi-modal Connecti­vity. The project is worth US$ 1.2 trillion and aims to stream­line the planning process to ensure that resources are effec­tively directed to development planning.

In addition, the Indian government introduced the National Infrastructure Pipeline (NIP) with estimated funding of more than a trillion dollars over five years. The NIP includes projects in the renewable energy sector.

India has also made headway in its infrastructure development plans through a sovereign wealth fund called the National Invest­ment and Infrastructure Fund (NIIF). It was set up to manage investments, and is intended to serve as a platform for co-investment by global and domestic investors, as well as multilateral development banks (MDBs).

In October last year, the government announced the launch of the India-Japan Fund in partnership with the Japan Bank for International Cooperation (JBIC). The fund is dedicated to investments for the promotion of sustainability and low carbon emissions.

Several large-scale highway projects have been launched across the country to augment India’s infrastructure drive. An unprecedented project that’s expected to be completed this year is the highway connecting New Delhi with the financial hub of Mumbai. This will greatly reduce travel time between the two megacities.

The year ahead will also be marked by the completion of the world’s highest railway. Plans to develop and modernise railway corridors in 2024 are also underway.

India’s aviation industry is expected to receive a boost with the launch of the Ude Desh ka Aam Naagrik (UDAN) scheme, which has led to a doubling of the number of airports and will strengthen the country’s supply chain.

The subcontinental country is well primed to be the next global economic powerhouse. And under the stewardship of Modi, India will see continuity for its infrastructure push, which may help it achieve superpower status.