Rising Govt capex fuelling surge in India's physical & digital infra

New Delhi Aug 28
The Union Government has enhanced its capital expenditure on infrastructure projects such as roads, railways and airports from Rs 1.97 lakh crore (1.6 per cent of GDP) in FY2014-15 to Rs 11.1 lakh crore (3.4 per cent of GDP) in FY2024-25, according to credit rating agency Moody's report.

Consequently, India's infrastructure development has seen unprecedented progress over the past decade, driven by substantial capital spending from both government and private sectors. This transformation spans physical infrastructure projects in railways, roads, and airports as well as digital advancements, positioning India as a leader among emerging markets, the report said.

This increase in government investment has also encouraged private sector participation through public-private partnerships (PPPs), it added.

Recent developments have not only bolstered connectivity and logistics but also significantly improved the country's ranking on the World Bank’s Logistics Performance Index (LPI).

From being ranked 54 out of 160 countries a decade ago, India has now shot up to the 38th position out of 139 countries. The infrastructure component of the LPI has similarly improved, moving up from 58 to 47 in the same period, according to the report.

India's physical infrastructure has expanded dramatically with the country now boasting of the second-largest road network globally, next only to the United States.

India's infrastructure density, including road and railway network lengths per 1,000 kilometres, now surpasses that of countries like China.

Airport passenger handling capacity has surged, with India recently shooting past Brazil and Indonesia to become the third-largest domestic aviation market, after China and the US, it said.

India has distinguished itself through its rapid advancement in digital infrastructure, notably via the Digital Public Infrastructure (DPI). This initiative, part of the broader Digital India campaign, has significantly expanded internet connectivity and facilitated digital service delivery, it added.