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Policy, Progress for India’s Highway sector, ET Infra

In the context of India’s ambitious journey toward a 5 trillion-dollar economy, the transport sector emerges as a pivotal player. The upcoming Union Budget is expected to transcend its role to an evolving visionary roadmap for this critical Industry.

At its core, the plan is expected to revolve around key themes: further push for green initiatives, digital innovation, evolving infrastructure financing, and bridging the rural-urban divide. These elements represent not just a shift in policy but a transformative stride towards comprehensive infrastructural development.

Eco-Conscious Infrastructure: The Green Highways Initiative Road transport is a dominant mode of transportation in terms of its contribution to Gross Value Added (GVA). Green Highways Initiative, anticipated to receive a significant boost in the budget, would bring sustainable practices into the
limelight of over 1.46 lakh km of national highway network.

This initiative, echoing India’s pledge for sustainable growth at the G20 summit, is expected to push further for utilization of recycled materials, integration of eco-friendly technologies, tree plantations, across the life cycle of highway development.

These steps are not just environmentally imperative but also strategically vital, marking a shift towards sustainable and eco-friendly infrastructure.

Connecting Rural and Urban India: A Commitment to Inclusive Growth
The upcoming budget is expected to further renew the focus on enhancing rural connectivity, crucial for achieving inclusive national progress. This PMGSY scheme initiative, coupled with the development of key expressways which has drastically reduced travel time across regions, underscores the government’s commitment to not just bridge the rural-urban divide but also boost logistical efficiency across the nation.

The Digital Transformation Anticipating a digital revolution, the road transport sector is set to embrace significant technological innovations. The shift towards Global Navigation Satellite System (GNSS)-based tolling systems is expected to streamline toll collection, inspired by successful implementations in a few developed countries.

The integration of advanced technologies such as IoT, AI, and GIS in road infrastructure is poised to redefine India’s highway transportation landscape, enhancing network management and safety. This digital leap is a critical step
towards ensuring efficiency and positioning India as a leader in innovative transportation solutions and the budget should consider dedicated funds to aid the push.

Innovative Maintenance Financing of Infrastructure
A paradigm shift in infrastructure financing and maintenance is on the horizon. The budget should consider addressing the current disparity in maintenance funding, where India allocates meager budget out of its total infrastructure budget compared to the developed economies.

An increase in funding for life cycle of the road assets, covering due and timely maintenance and establishment of a dedicated fund is anticipated. This proactive approach will extend the lifespan of roads, reduce the need for costly repairs and reconstruction, and facilitate the sustainability of infrastructure.

Catalyzing India’s Logistic Ecosystem
The Government’s National Master Plan for Multi-Modal Connectivity aims to significantly reduce logistics costs from the current double digit of the GDP to a more manageable single-digit figure. This ambitious plan emphasizes the importance of investing in alternative transport modes and developing multimodal logistics parks and cargo terminals. These strategic investments are crucial for reducing logistics costs, enhancing efficiency, and paving the way for a self-reliant India.

Paving the Path for a Robust and Efficient Highway Transport Sector
The forthcoming Union Budget is poised to mark a new chapter for the Indian Highway Industry, underpinned by strategic investments and forward-thinking policies.

By embracing sustainability, technology, and inclusivity, the
government is set to build a robust, resilient, and efficient transport infrastructure. This visionary approach is expected to propel India into a new era of economic growth and infrastructural excellence, aligning the nation with
global standards and expectations.

(This article has been written by Vishal Gupta, Executive Director, Deloitte Touche Tohmatsu India LLP)

  • Published On Jan 24, 2024 at 03:22 PM IST

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