India’s infrastructure has improved significantly in recent years, highlights a report by Morgan Stanley.
The report noted that India’s infrastructure competitiveness has historically been hampered by weak infrastructure. However, recent improvements and government initiatives, such as Jati Shakti, show great promise for further progress.
“India’s infrastructure has improved significantly in recent years – and there is significant scope for further improvements through recent government initiatives such as PM Gati Shakti (PMGS),” the report said.
In the past decade, the report said, India has significantly increased its infrastructure spending, with a strong focus on expanding and modernizing its physical assets.
The report also highlighted that when comparing the size of infrastructure relative to GDP, India compares favorably with China, which is often seen as a benchmark for large-scale infrastructure development.
Several ministries of the Government of India have initiated long-term sector-specific infrastructure plans to further improve various sectors of the economy.
These projects include Bharatmala Road Development, Sagarmala Port Connectivity, Energy for All, and Waterways Development Programme.
According to the report, “This helps margins move goods faster and at a lower cost than in the past,” demonstrating the tangible benefits of these initiatives.
Looking ahead, the report predicts a steady increase in infrastructure investment in India. It is expected to rise from 5.3 percent of GDP in fiscal year 2024 (F24) to 6.5 percent by fiscal year 2029 (F29). This increase indicates a strong compound annual growth rate of 15.3 percent, leading to cumulative spending of US$1.45 trillion over the next five years.
As of the current fiscal year, India’s GDP is 19 percent of China’s GDP. China has long been known for its massive investments in infrastructure, providing unparalleled scale, scale and efficiency. However, the report notes that India’s physical infrastructure does not lag significantly behind China when considering the size of their economies.
Although there may be clear differences in efficiency and quality, the report said that ongoing and planned investments in India indicate progress and potential for further development.
As India continues to develop its infrastructure, it is poised to make significant progress, positioning itself favorably in the global context.
(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)