Run-up to Budget 2018-19: Roads, railway construction in the slow lane
Actual construction of highways and rural roads has lagged the capital spending done on these two sectors, while the capital spend on railways has produced commensurate results in the first eight months of the financial year, according to the data tabled in Parliament.
About 73 per cent of the capital spend for highways has been used till November 2017, but only 33 per cent of planned highways are complete. The budget for rural roads has been spent thriftily, but only 25 per cent of planned rural roads have been upgraded, though the planned habitations to be connected has been fairly on track.
About 60 per cent of designated railway capital spending has produced commensurate results.
Roads — including highways and rural roads — and railways are one of the most capital intensive expenditures of the Union Budget, after the defence sector. While the former totals Rs 1.3 trillion, the latter alone, at Rs 865 billion, represents the biggest chunk of capital expenditure.
Rural roads under Pradhan Mantri Gram Sadak Yojana (PMGSY), with an infusion of Rs 190 billion, has been included. The Budget 2017-18 envisioned a capital expenditure of Rs 3,100 billion in the total expenditure of Rs 21.5 trillion, with capex representing about 14 per cent of the spending pie.
Capital expenditure, despite being front-loaded, could not yield desired results in construction of highways and rural roads in the first eight months of the financial year.
On the rural roads front, only 40 per cent of the budgeted amount, Rs 77 billion of Rs 190 billion, is spent till November. Although, three-fourths of habitations got connected to roads network in eight months under the PMGSY, only a quarter of road length under PMGSY-II — the part of the rural roads scheme that focuses on upgradation of existing roads and consolidation of road network around it — is complete.
Railways
Of the Rs 550 billion allocated for railways, Rs 212 billion was earmarked for the construction of new lines. Till November 2017, 56 per cent of the physical target — 2,000 km of the targeted 3,600 km — was completed.
Apart from new lines, 130 rail overbridges and 332 underbridges had been constructed in FY18 till December 2017.
Against a target of electrification of 4,000 km of lines, no data pertaining to physical achievement in 2017-18 was available. More than half the network — 37,844 km of 67,368 km — is yet to be electrified, for which the power requirement is 3,200 Mw. The railways ministry has pegged the required capital infusion for this at Rs 326 billion or Rs 1 billion for every 116 km.
On revenue expenditure, working expenses of Indian Railways at Rs 929 billion had surpassed the planned expenses of Rs 916 billion till November. On revenues earned, passenger and freight revenue of Rs 1 billion was collected against expected revenue of Rs 1.1 trillion.
Rural roads
Against allocation of Rs 180 billion for this head, Rs 77 billion was spent till end-November. In terms of physical achievement, 131,000 of an eligible 178,000 habitations had been connected by new roads/upgraded roads under the first phase of PMGSY in FY18 till November.
Under the second phase, 12,456 km — of the FY18 target of 50,000 km — had been fully upgraded till the end of November, 25 per cent completion in two-third of the financial year. Readmore
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