Transport Infrastructure & Investment Models (DAMP)
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Contents
- What is the status of the Indian aviation industry, and how can the transition to a Public-Private Partnership (PPP) model in the Indian Airways sector be managed carefully to foster its growth and development?
- The government’s directive to ports to develop master plans for achieving ‘mega port’ status by 2047 prompts a discussion on port challenges and solutions to advance India’s blue economy.
- Explain the role of inland waterways in fostering sustainable transport in India. Identify the challenges hindering their development. Additionally, outline a comprehensive roadmap for future inland waterway development in the country.
- Evaluate the socio-economic effects of enhanced road connectivity in rural areas. Discuss the obstacles encountered in achieving improved road infrastructure and propose measures to address these challenges.
19-07-2023
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Answer :
The civil aviation industry in India has emerged as one of the fastest growing industries in the country during the last three years. India is expected to overtake China and the United States as the world’s third-largest air passenger market in the next ten years, by 2030.
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Status of Indian Aviation Industry: |
- Domestic traffic contributes around 69% of the total airline traffic in South Asia and India’s airport capacity is expected to handle 1 billion trips annually by 2023.Â
- In FY22, airports in India pegged the domestic passenger traffic to reach 166.8 million, a 58.5% YoY increase, and international passenger traffic to reach 22.1 million, a 118% YoY increase, as compared to FY21.
- As of 2022, India had 131 operational airports. India has envisaged increasing the number of operational airports to 220 by 2025. The number of PPP airports is likely to increase from five in 2014 to 24 in 2024.
- According to DPIIT, FDI inflow in India’s air transport sector (including air freight) reached US$ 3.61 billion in FY 2022.
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Initiatives by government to promote Aviation Industry: |
- The government has allowed 100% FDI under the automatic route in scheduled air transport service, regional air transport service, and domestic scheduled passenger airlines.
- NABH (NextGen Airports for Bharat) – Nirman is a government initiative to expand airport capacity more than five times to handle billions of trips a year, in the next 10-15 years.
- AAI Startup Policy: Delivering a framework & mechanism for the interaction of AAI with internal and external stakeholders that catalyze innovation at airports and leveraging technology for addressing challenges and enhancing the delivery of services to passengers.
- UDAN-RCS scheme has been launched by the government which aims to increase air connectivity by providing affordable, economically viable, and profitable travel on regional routes.
- AAI and other Airport Developers have targeted a capital outlay of approximately Rs. 98,000 crores in the airport sector in the next five years.
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Public-Private Partnerships (PPPs) in the Indian Airways sector offers several compelling reasons: |
- Infusion of Capital: PPPs attract private investments, providing a significant source of funding for infrastructure development, modernization, and expansion of airports, airlines, and related services.
- Enhance operational efficiency: PPPs can bring private sector expertise, efficiency, and innovation to the aviation sector which will reduce costs and enhance overall efficiency.
- Risk Sharing: By engaging private partners, the risks associated with aviation projects can be shared. Private partners assume some of the financial and operational risks, relieving the burden on the government.
- Improved Service Quality: Private partners have incentives to deliver superior services, leading to enhanced facilities, better maintenance, shorter wait times, and improved passenger amenities.
- Employment Opportunities: With private investments and expansion of infrastructure, there is a potential for increased employment generation.
- Economic Growth and Connectivity: The development and expansion of airports and airlines facilitate better connectivity, both domestically and internationally. This can boost tourism, trade, and economic growth, attracting investments and contributing to regional development.
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Some reasons to manage PPP carefully in Indian Aviation sector: |
- Strategic Planning: Careful strategic planning to identify the sectors or services suitable for PPP, ensuring alignment with aviation policies.
- Regulatory Framework: Establishing a robust regulatory framework is essential to govern the PPP arrangements, addressing issues such as pricing, service quality, and competition to protect consumer interests.
- Transparency and Accountability: Implementing transparent processes for selecting private partners, conducting fair bidding processes, and ensuring accountability in contract management is vital to prevent potential misuse of public resources.
- Risk Allocation: Clear delineation of risks between public and private partners is necessary to avoid undue burden on the government or taxpayers.
- Financial Viability: Considering factors such as revenue-sharing models, return on investment, and the ability of private partners to deliver quality services while ensuring profitability.
- Public Interest Safeguards: Protecting public interests, such as affordable and accessible air travel, should be a core consideration during the PPP transition.
 The progress of the aviation sector in India has been remarkable, with significant growth, infrastructure development, and government initiatives aimed at enhancing connectivity and affordability. AAI and other Airport Developers have targeted a capital outlay of approximately Rs. 98,000 crores in the airport sector in the next five years for continuous improvements, technological advancements, and enhanced passenger experiences.
12-08-2023
Answer :
A mega port earns its label through cargo volume, economic value, or spatial extent. These ports drive the ‘blue economy,’ using ocean resources for growth, livelihoods, and ecosystem health. India aims to make all ports mega by 2047. However, significant challenges persist:
- Underutilized Capacity: Despite handling most cargo, ports operate below capacity. For instance, major ports with a 1500 MTPA capacity handled only around 670 MT in 2020-21.
- Infrastructure Issues: Ports grapple with low productivity, extended turnaround and pre-berthing times, and high freight costs.
- Digital Gaps: Absence of an integrated online portal hampers information exchange among stakeholders, as isolated IT solutions lack interaction.
- Logistical Bottlenecks: Inadequate expressway links and high fuel costs hamper hinterland transport efficiency.
- Labour Inefficiencies: Local unskilled labor affects overall productivity and cargo handling.
- Competitiveness Challenges: High taxation and compliance burdens raise operational costs for Indian vessels.
- Investment Shortfalls: Despite incentives, cumulative FDI in maintenance and port operation was only $1.63 billion from 2000 to 2021.
Addressing these issues requires:
- Dredging Sector Openness: Attract international players to maintain port draft depth and cater to larger vessels.
- Sagarmala Program Acceleration: Expedite projects enhancing port connectivity, establishing coastal economic zones (CEZs), and building new ports.
- Cost Reduction Initiatives: Streamline hinterland-to-port goods movement to cut costs.
- Digital Integration: Develop the ‘National Portal for Cargo Facilitation (NPCF)’ to unite stakeholders.
- Technology Adoption: Embrace technologies like big data and AI, learning from successful global ports for efficiency improvements.
- Sector Liberalization: Flexible procedural, operational, and financial measures to enhance competitiveness.
- Collaborative Efforts: Encourage cooperation among terminal operators, ship owners, exporters, and importers to meet sector demands.
In a global context, India must adapt, staying competitive by nurturing flexibility and cohesion across stakeholders to meet evolving challenges.
22-07-2023
Answer :
Inland Water Transport was an important means of trade and communication in ancient India. But, with the development of roadways and railways in the 19th and 20th century, it got sidelined. In recent years, GoI has again started emphasizing on the need of developing Inland Waterways because of its inherent
advantages like fuel efficiency, competitive potential and thus ability to promote economic development
and growth.
Inland Waterways Potential in India: Inland water transport holds great untapped potential as a means for the transportation of goods and passengers. India has a large endowment of rivers, canals, and other waterways. The total navigable length of waterways in India is around 14,850 kilometers.
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Need for improving and Inland waterways and ports: |
- Contribution in trade Only 3.5% of trade in India is done through the mode of Inland waterways, which is 47% in China, 40% in Europe, 44% in Japan and Korea and 35% in Bangladesh.
- Fuel Efficient -> Cost Effective
- Less Polluting: Environment friendly as the emission per unit distance per unit weight is lesser.
- Economic growth and jobs: It will boost the economy and provide more jobs, especially in inland regions which needs desperate boost to economies.
- Reducing Pressure on Road -> less congestion
- Fewer accidents – when compared to any other mode of transport.
- Less Land Acquisition Problems and Less Deforestation: As land capital required in case of water transport is minimal when compared to road and rail transport.
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Challenges faced by Inland Waterways development in the country: |
- Finance: According to Ministry of Shipping, India needs Rs 80,000 crores to develop 20,000 km of inland
- Who will use inland waterways: For e.g., there are not a lot of industries situated along the Ganga River. So, the waterways may not be used a lot.
- Seasonal Variation in Navigable depth
- Most river transport routes are short: River transport routes should run uninterrupted for at least 300 km at a stretch so that desired logistics cost saving might be achieved.
- Dams and Barrages interrupt the water supply: Tussle between states would lead to unviability of some of these projects.
- Environmental Concerns (e.g., how EN Ganges river dolphins are being affected by NW-1)
- Other Concerns -> low transport speeds, limited areas of operation etc.
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Way forward: |
- Increased budgetary allocation to the Ministry of Shipping which can be used for more allocation to inland waterways project.
- Simultaneous focus on development of industries in the inland water ways region to ensure that waterways get used more and more and are economically viable.
- Dams and diversion of water for agriculture can be reduced by focusing on newer dam technologies which limit the amount of water that needs to be stored and promoting efficient utilization of water in agriculture.
- In undertaking this paradigm shift towards inland transport, India should implement the sustainability practices in Europe.
- A consultative, inter-disciplinary approach, as opposed to a techno-centric one, would keep the negative consequences to a minimum.
21-07-2023
Answer :
Rural connectivity is a key component of rural development in India. The construction of rural roads brings various socio-economic benefits to the rural areas and result in forming a strong backbone for the agro-based economy.
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Positive Impacts of better road connectivity in rural areas are multidimensional: |
 It results in diversified livelihoods’ portfolio and improved quality of life for rural communities.
â–« Agriculture
» Road connectivity leads to increase in the quality of inputs for agriculture in terms of better seeds, fertilizers, motorized agri-equipment, vehicles etc.
» Better connectivity to market also triggers increase in production of dairy, poultry and allied activities.
â–« Promotes local industries.
» Better access to raw material and market for the sale of finished products.
â–« Improved Employment opportunities
» Not only due to better agri-productivity and local industries, but also because of access to employment opportunities outside the village.
â–« Improved Health Access
» Due to easy access to health centres which becomes more crucial during emergency situation
â–« Improved educational opportunities.
» Better connectivity leads to easy accessibility for both school and higher education facilities.
» It is expected to contribute to increase in attendance and enrolment of primary and middle school.
â–« Better law and order
» Police or other armed forces agencies improve their mobility and thus can reach the crime scene quickly.
» This also creates more deterrence among criminals.
â–« Better implementation of government schemes/programs
» For e.g. Pradhan Mantri Ujjwala Yojana which aims to provide LPG cylinders to BPL families will be more effective in those rural areas which are better connected.
â–« Enhanced Disaster Management
» Relief and rescue reaches more effectively
» Rehabilitation work can also be faster in better connected areas.
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Pradhan Mantri Gram Sadak Yojana (PMGSY) |
â–« PMGSY was launched in the year 2000, as a centrally sponsored program and a one-time special intervention by Ministry of Rural Development (MoRD).
â–« The primary objective of the programme was to provide.
§ Connectivity by way of all-weather roads to unconnected habitations of designated population size of more than 500 in plain areas and 250 in north-east, hill, tribal and desert areas as per the census 2001.
§ Upgradation of selected roads to provide full farm to market connectivity.
§ Connecting left wing affected areas Scheme:
§ To improve rural road connectivity in the left wing extremism affected districts from security angle , the Cabinet had in 2016 approved the centrally-sponsored “Road Connectivity Project for Left Wing Extremism (LWE) Affected Areas” scheme.
§ The Project will be implemented as a vertical under PMGSY to provide connectivity with necessary culverts and cross-drainage structures of 44 worst affected LWE districts and adjoining districts, critical from security and communication point of view.
§ Development of Major District Roads (MDRs): PMGSY guidelines don’t permit construction/upgradation of MDRs. However, keeping special circumstances of LWE area in view, MDRs would be taken up under the scheme as a special dispensation.
§ Government has taken up task of connecting habitations with more than 100 persons in LWE affected blocks under PMGSY.
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Key challenges being faced by PMGSY: |
- Adequate Maintenance of the existing 4.6 million km of road network is emerging as a major challenge.
â–« Many parts of the existing road network is either vulnerable or have already suffered damage from climate induced events such as floods, high rainfall, sudden cloud bursts and land-slides.
â–« Generating funds for road maintenance has become a crucial challenge.
b. Wide variation in unit costs among states leads to confusions and delays.
â–« Further, the cost is very high in some states which hinders the project
c. Delays in execution
â–« Adverse weather condition
â–« Issues in land acquisition
â–« Law and order problems
d. Non-availability of labor and material especially in remote areas
e. Lack of technically trained staff to execute and monitor road work
f. Providing public transport in these roads.
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Way forward: |
i. Climate vulnerability assessment during the design process to identify the critical locations affected by
floods, waterlogging, submergence, cloud bursts, storms, landslides, poor drainage etc.
ii. Special treatment for flood affected areas through adequate waterways and submersible roads. Use of
environmentally optimized road designs.
iii. For reducing the cost, the use of non-traditional but durable and less expensive material such as iron
and steel slag, fly ash and lime that are locally and easily available may be adopted.
iv. Proper Scheduling
â–« Schedule work after monsoon to avoid delays and cost over-runs.
v. Build Operate and Transfer Model can be considered to deal with the issue of lack of resources.
vi. Better Monitoring can be achieved by giving the responsibility of monitoring and undertaking minor maintenance to Gram Panchayat.
vii. Skill development of rural workforce should also focus on road construction and maintenance activities.