The Indian infrastructure sector has undergone a remarkable transformation since India gained independence in 1947. Initially marked by limited resources and outdated infrastructure, the sector has become a critical component of the country’s economic development. This article outlines significant milestones and developments in the Indian infrastructure sector over the decades.
In the early years following independence, the infrastructure sector in India was largely underdeveloped, with limited road networks, outdated ports, and insufficient power generation capacity. The government recognised the need for substantial investments to build a robust infrastructure base. During this period, key projects included the construction of major roads and bridges, as well as the development of railways.
In the 1950s, India embarked on its first Five-Year Plan, focusing on industrialisation and infrastructure development. The first Five-Year plan was quite a success. Although the plan only aimed to achieve a growth of 2.1% GDP, the growth reached up to 3.6%, leading to an immense economic development that the country had not seen for years.
Improvements were seen not only in agriculture and irrigation but also in price stability, reduced inflation, increased capital income, better employment opportunities, and self-sufficiency. The first five-year plan also focused on infant mortality, health, medical science, transport, and technology, leading to notable advancements.
By the end of the first plan in 1956, India inaugurated five new technical institutions, the Indian Institutes of Technology (IITs), funded by the University Grants Commission (UGC) to enhance higher education and student prosperity.
Notably, the Bhakra Nangal Dam, completed in 1963, played a crucial role in irrigation and hydroelectric power generation. Additionally, the development of the Indian Ports Act in 1963 led to the modernisation of port facilities and increased cargo handling capacities.
The 1970s and 1980s marked a period of significant expansion and modernisation in infrastructure. Between 1970 – 71, there were 29 national highways and 89 state highways, an increase from 24 and 62, respectively, between 1960 – 61.
By 1970, there were 10 major ports in the country, handling 62.46 metric tonnes of total traffic. During the same period, the power generation capacity was 16,270 MW. Even the total number of telephones were 0.98 million.
The 1980s saw a substantial change in the infrastructure sector. In 1988, the National Highways Authority of India (NHAI) was established to oversee the development of the national highway network. Creating the NHAI was a pivotal step towards improving road connectivity nationwide.
The 1990s were a transformative decade for India’s infrastructure sector, driven by economic liberalisation and globalisation. The introduction of the National Telecom Policy in 1994 was a landmark move, leading to the liberalisation and privatisation of the sector. The National Telecom Policy defined certain important objectives, such as making telephones readily available, providing world-class services at affordable prices, positioning India as a major telecom equipment manufacturing and export hub, and ensuring universal access to basic telecom services in all villages.
This period also witnessed the development of major urban infrastructure projects, including the Delhi Metro’s planning and approval stages.
One of the most significant achievements during this period was the launch of the Golden Quadrilateral project in 2001. This ambitious road network aimed to connect major cities across India, including Delhi, Mumbai, Chennai, and Kolkata. The Golden Quadrilateral greatly improved road connectivity and boosted economic activities across the country.
The 2000s also saw advancements in power generation and transmission. The introduction of the Electricity Act in 2003 facilitated the restructuring of the power sector, promoting competition and improving service delivery.
By 2006-07, India had 67 national highways and 137 state highways. The power generation capacity also increased to 1,54,664 MW.
In recent years, the Indian infrastructure sector has continued to grow, with significant investments in transportation, energy, and smart cities. The government’s focus has shifted towards sustainable development and technological integration.
The Smart Cities Mission, launched in 2015, aims to develop 100 smart cities across India with enhanced infrastructure, digital connectivity, and improved quality of life for residents. The Pradhan Mantri Awas Yojana (Urban) scheme, introduced in 2015, targets affordable housing for all, further contributing to urban infrastructure development.
The National Infrastructure Pipeline (NIP), announced in 2019, outlines a comprehensive investment plan for infrastructure projects over the next five years. With an estimated investment of over US$ 1.4 trillion, the NIP focuses on sectors such as transportation, energy, and water supply. In June 2022, the Minister of Road Transport and Highways opened 15 national highway projects worth ₹13,585 crore (US$1.7 billion) in Patna and Hajipur, Bihar.
In March 2024, Prime Minister Mr Narendra Modi inaugurated multiple connectivity projects in Kolkata, totaling US$ 1.8 billion.
While significant government support is driving the growth of the infrastructure sector, which is vital for India to reach its 2025 economic target of US$ 5 trillion, several companies are also playing a pivotal role in the sector’s advancement.
A few of these companies include Adani Ports and Special Economic Zone Limited, IRB Infrastructure Developers Ltd, GMR Airports Infrastructure Ltd and Larsen and Toubro Ltd. As of August 8, 2024, the 5-yr CAGR of these companies are 32.91%, 45.86%, 45.74% and 21.75%, respectively.
Notably, Adani Ports and Special Economic Zone Limited is India’s largest private-sector port operator, with 627 MMT cargo handling capacity. The company holds 13 domestic ports located in 8 maritime states in the country.
In March 2024, the Minister of Civil Aviation and Steel announced plans to inaugurate 15 airport projects valued at US$12.1 billion by 2028. India’s logistics market is estimated to reach US$ 484.43 billion by 2029.
Additionally, the development of the Delhi-Mumbai Expressway, expected to be completed by 2025, represents one of the largest infrastructure projects in India. This expressway aims to reduce travel time between the two major cities and enhance logistical efficiency.
Since independence in 1947, the Indian infrastructure sector has transformed from a state of underdevelopment to a key driver of economic growth. Significant developments, from early post-independence projects to recent advancements in smart cities and national infrastructure pipelines, reflect the sector’s dynamic evolution.
Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.
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