PM Gati Shakti scheme has scaled up India’s infra, spurred growth: Morgan Stanley

New Delhi, June 28: Global investment bank and financial company Morgan Stanley has stated that the PM Gati Shakti scheme has succeeded in giving a new fillip to India’s infrastructure development and multi-modal connectivity across highways, railways and ports that has spurred economic growth. According to the report, India has scaled up its infrastructure strongly over the last decade, with higher investment that is also better targeted and potentially more productive.

"We expect India's infrastructure investment to steadily increase from 5.3 per cent of GDP in FY24 to 6.5 per cent of GDP by FY29. Indeed, this implies that infrastructure investments are expected to register a strong 15.3 per cent CAGR, resulting in cumulative spending of USD 1.45 trillion over the next five years. In our view this will help to lift the investment rate, leading to a sustained period of high productive growth."

Interestingly, the report also states that “contrary to popular perception, India's physical infrastructure scale already compares favourably to China's when viewed in the context of GDP differential.” The report cites the World Bank's Logistics Index Report, 2023, which records that the average Container Dwell Time in Indian ports was three days compared to four days for countries like the UAE and South Africa, seven days for the USA, and 10 days for Germany.

Indian Ports "turnaround time" has reached 0.9 days, which is better than the USA (1.5 days), Australia (1.7 days), Singapore (1.0 days), etc. 6. In F24, ports overall cargo growth was 7 per cent, with 53 per cent of cargo handled by major ports (government-owned).

Prime Minister Narendra Modi launched the PM Gati Shakti National master plan for infrastructure development in October 2021. It brings 16 ministries including Railways and Highways together on a digital platform for integrated planning and coordinated implementation of multi modal connectivity projects. It is conceived as a transformative approach for economic growth and sustainable development with roads, railways, airports, ports, mass transport, waterways and logistics infrastructure constituting “7 engines “ to pull the economy forward in unison.

According to the Morgan Stanley Report, initiatives under PM Gati Shakti are yielding results. Under the PM Gati Shakti scheme so far, cumulatively 101 projects worth Rs 60,900 crore have been identified for implementation in the ports and shipping sectors. As of April 2023, 26 projects, worth Rs 8,900 crore have been completed, 42 projects worth Rs 15,340 crore are under development, and 33 projects worth Rs 36,640 crore are under implementation.

The Ministry of Ports, Shipping, and Waterways (MoPSW) is also implementing a comprehensive port connectivity plan in coordination with the highways and railways ministries. The Morgan Stanley report says under the Sagarmala programme, 220 projects worth Rs 1.12 lakh crore have been completed and 231 projects worth Rs 2.21 lakh crore are under implementation while 351 projects worth Rs 2.07 lakh crore are at the evaluation stage. Similarly, National Waterways are also being developed as a more efficient and environment friendly means of transport for both cargo and passengers.