In India, a beginning in the air transport was made in the year 1920, when the government first decided to prepare air routes between Mumbai and Kolkata. The civil aviation work actually started in in 1924-25, but the progress was slow until the outbreak of the second World War.
Hindustan Aeronautics Limited: The Hindustan Aircraft (now Hindustan Aeronautics Limited), was founded in 1940. It was started at Bangalore (now Bengaluru) as a repair, overhauling and assemblage depot, has now grown into an important manufacturing plant. It has designed and manufactured trainer air-crafts. It belongs to the aerospace and defence industry. It is managed by Ministry of Defence.
Civil Aviation Recent Developments: A Snapshot
India is the 9th largest civil aviation market in the world, In FY17, domestic passenger traffic witnessed a growth rate of 21.5 per cent
In FY17, airports in India witnessed a domestic passenger traffic of about 205 million people.
Investments worth US$ 6 billion are expected in the country’s airport sector in 5 years
India’s civil aviation market is set to become the world’s 3rd* largest by 2020 and expected to be the largest by 2030
Growth Potential & Drivers of Indian Aviation Industry
Airport Authority of India
Airports & Airstrips in India
Major Airline Operator in India
Private Sector Participation in Airport Development
Until 2013, AAI was the only major player involved in developing and upgrading airports in India.
Post liberalisation, private sector participation in the sector has been increasing.
Private sector investment increased to US$9.3 billion during the 12th Five Year Plan from US$ 5.5 billion in the previous plan.
In March 2017, by selling off 2 offshore bonds, GMR plans to raise US$250-300 million for refinancing their debt. In June 2017, GMR announced plans to refinance loans and divest assets in road and power sectors to cut debt so as to invest up to Rs. 7,400 (US$ 1.15 billion) crore to expand Delhi and Hyderabad airports.
Successful PPP Model Airports in India
Presently India has 5 PPP airports each at Mumbai, Delhi, Cochin, Hyderabad and Bengaluru, which together handle over 55 per cent of country’s air traffic.
Government of India has approved 15 greenfield PPP projects which are expected to increase the air traffic in India. These projects would be setup in Goa, Navi Mumbai, Maharashtra, Bijapur, Gulbarga, Karnataka, Kerala, West Bengal, Madhya Pradesh, Sikkim, Puducherry and Uttar Pradesh.
Government Initiatives in Civil Aviation Sector
Classifications of Roads
Roads are mainly classified into following Categories:
Road Network in India
Importance of Road Transport
Road Development in India
The major initiative undertaken by the government for the development of road sector are:
National Highway Development Project
NHDP deal with the development of high quality highways. NHDP is the largest highway project undertaken in the country. It has been implemented by the National Highway Authority of India (NHAI).
Initially, The National Highway Development Project (NHDP) consists of two major components:
The “Golden Quadrilateral”: The Golden Quadrilateral” project will connect the four major metropolitan cities (Delhi. Mumbai, Chennai & Kolkata) with 4-6 lane highways, with a total length of about 5,850 km.
The “North South – East West” projects: The “North South – East West” project will connect the Northern most point of the country to the Southernmost, and similarly from East to West, with a total length of about 7,300 km
The NHDP was expected to cost Rs 540 billion, when started in 1998. The financing pattern of this project indicates that private sector participation in the form of investment amounts to only Rs 40 billion (7.4 per cent of the total).
Over the course of the project, institutions like the World Bank, Asian Development Bank (ADB) and Japanese Bank for International Cooperation (JBIC) are expected to finance about Rs 200 billion; another Rs 200 billion of investment would be financed from the cess.
NHDP consists of following Phases:
Problems of the Road Sector
Road Sector in India Recent Developments
Expansion of Roadways:
Road Development Program for North East Region
The Special Accelerated Road Development Programme for the North-Eastern region (SARDP-NE) is aimed at developing road connectivity between remote areas in the North East with state capitals and district headquarters
SARDP-NE is vested with the development of double-/four-lane national highways of about 7,530 kms and double-laning improving about 2,611 kms of state roads, as on FY16
Implementation of the road development programme would facilitate connectivity of 88 district headquarters in North Eastern states to the nearest National Highways
The project would be undertaken in following 3 phases:
Policy Initiatives by the Government
Construction Sector
Affordable Housing Scheme
Infrastructure Development in North Eastern States
Metro Rail and Mono Rails
Mono Rail
Historical Timeline
Infrastructure Sector: Recent Developments
FDI Flows in the Infrastructure Sector
Infrastructure Projects Completed during 12th Five-Year Plan
Expansion of Roads: Recent Trends
Revenue growth of Indian Railways
Power Generation Capacity
Performance of Eight Core Infrastructure Sector
Definitions:
Infrastructure is a key driver of the overall development of Indian economy. Infrastructure sector focuses on major infrastructure sectors such as power, roads and bridges, dams and urban infrastructure.
“Infrastructure is generally understood as the basic building blocks required for an economy to function efficiently”.
The National Statistical Commission headed by Dr. C. Rangarajan, attempted to identify infrastructure based on some characteristics. The Rangarajan Commission indicated six characteristics of infrastructure sectors:
Based on these features (except b, d, and e), the Commission recommended inclusion of following in infrastructure in the first stage:
Dr. Rakesh Mohan Committee in “The India Infrastructure Report” included:
The World Bank treats power, water supply, sewerage, communication, roads & bridges, ports, airports, railways, housing, urban services, oil/ gas production and mining sectors as infrastructure.
The Economic Survey considers power, urban services, telecommunications, posts, roads, ports, civil aviation, and railways under infrastructure sector.
Why do Infrastructure Matter for Growth & Development?
There is, indeed, a plethora of anecdotal and more technical evidence that suggests development of infrastructure can lead to growth and development of an economy.
The argument is particularly true for the developing countries which lack adequate infrastructure facilities. Intuitively, it should make sense to assume that the more developed a country is, the higher its infrastructure facilities and hence the lower the return from additional investment in roads, railways, ports etc. However, the less developed a country is, the more likely the infrastructure is to matter, because the returns from the Infrastructure development will be much more than the cost of the projects.
Example: A massive road-building exercise in a poorly developed state can offer a one-time boost production activity and productivity of workers in the state.
Infrastructure Sectors & Growth
Any modern textbook on industrial economics or industrial organization will point out that for industries that enjoy network externalities (positive spill over effects/benefits to other sectors/industries), the social rate of return has to be higher than the private rate of return in these projects—assuming that the regulation does not allow the network externality to be turned into a private rent. In other words, their impact on GDP and its growth should be high. This explains for instance why the growth impact of the telecoms sector so often come out to be high. But for specific countries or regions, this could also be true for transport or electricity.
In general, however, all infrastructure subsectors can be good examples of sectors in which such network externalities can matter. This section reviews the main lessons available on each subsector on the growth impact of each infrastructure subsector.
Energy Sector
The importance of energy sector especially electricity in promoting growth and development via human development and physical development is well known. The single most reason obstructing the growth of the industrial sector in general and manufacturing in particular in India is deficiency of continuous power supply (electricity/electrification) to run factories.
Various studies have found out that, there exist a positive impact on energy infrastructure on the growth of an economy. Therefore, investing in the energy sector may be the safest bet to achieve a high growth. This should not be a surprise, energy is indeed an input into any of the other infrastructure subsectors—for instance, water for irrigation purpose is often pumped through the electric pumps.
Telecommunication
The impact of telecommunication on the growth is found to be maximum. The availability of fixed line phones and mobile phone penetration have effectively transformed the Indian economy and has given boost to Businesses like BPOs and KPOs (Knowledge Processing Outsourcing).
The recent growing research on the importance of the access to internet to increase competition in the private and public sector and from increasing competition to the higher social return and growth of industries is well documented.
Transport
For developing countries like India, the estimated growth effects of transport investments have been very strong. This has been a common finding in research over the last 20 years or so. This is not surprising since the transport facilities in India are weak. The main impact of improved transportation facilities on the development has to come from quality, from addressing bottlenecks or from capturing new network or suprational effects which have not been internalized in older designs of the transport networks.
In fact, studies have found, that for most of the developing countries, the construction of Roads, Railways, Highways, Airports and Sea Ports have contributed positively towards increasing growth.
For instance, roads are needed in Africa, if Africa wanted to match the growth rate of the rest of the world. Construction of Roads & Highways are essential to reduce differences across regions in India. Ports are needed in India, if India, wants to increase its exports and become a major player in the Global Economy.
Q.1) Consider the following statements regarding the ‘P5+1’ countries:
1. Germany is a member of ‘P5+1’.
2. All the five permanent members of UN Security Council are not members of ‘P5+1’
Which of the statements given above is/are correct?
a) 1 only
b) 2 only
c) Both are correct
d) None is correct
Q.2) The Term ‘Intifada’ is related to
a) Spain
b) Israel
c) Russia
d) Monglolia
Q.3) Which of the followig Department/Ministry/Tribunal deals with the matter related to Anti-Dumping?
a) Department of Industry Policy and Promotion(DIPP)
b) Minsitry of Finance
c) Customs, Excise and Service Tax Appellate Tribunal (CESTAT)
d) None of the above
Q.4) Consider the following:
1. Indonesia
2. Thailand
3. Bangladesh
Which of the above have FTA with India under aegis of ASEAN?
a) 3 only
b) 1 and 2 only
c) 2 and 3 only
d) All Of the above
Q.5) Consider the following statements regarding FDI and FPI:
1. FPI tends to involve establishing more of a substantial, long-term interest in the economy of a foreign country.
2. FDI is an equity investment with a shorter time frame for investment return
Which of the above is/are correct?
a) 1 only
b) 2 only
c) Both 1 and 2
d) Neither 1 nor 2
Q.6) What is/are the purpose/purposes of ‘Marginal Cost of Funds based Lending Rate (MCLR)’announced by RBI?(CSE: 2016)
1.These guidelines help improve the transparency in the methodology followed by the banks for determining the interest rates on advances
2.these guidelines helps ensure the availability of bank credit the interest rate which are fare to the borrowers as well as the banks
Select the correct answers using the code given below
a) 1 only
b) 2 only
c) Both 1 and 2
d) Neither 1 nor 2
Q.7) What is/are the unique about the ‘Kharai Camel’ a breed found in India(CSE: 2016)
1.It is capable of swimming up three kilometers in seawater
2.Its survives by grazing on mangroves
3.It lives in the wild and cannot be domesticated
Select the correct answers using the code given below
a) 1 only
b) 2 only
c) Both 1 and 2
d) Neither 1 nor 2
Q.8) Recently, our scientists have discovered a new and distinct spices of banana plant which attains a height of about 11 meters and has orange – colored form of pulp. In which part of India has been discovered?(CSE: 2016)
a) Andaman Islands
b) Anaimalai Forests
c) Maikala Hills
d) Tropical rainforest of North east
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