Budget 2021: National Infrastructure Pipeline Expanded To Cover 7,400 Projects
The National Infrastructure Pipeline, which was launched with 6,835 projects, has now expanded to 7,400 projects.
The government has extended its Rs 111-lakh-crore ($1.5 trillion) National Infrastructure Pipeline to cover more projects by 2025 in an effort to shore up economic growth as the nation recovers from the pandemic-induced recession.
“The National Infrastructure Pipeline, which was launched with 6,835 projects, has now expanded to 7,400 projects. Around 217 projects worth Rs 1.10 lakh crore under some key infrastructure ministries have been completed,” Finance Minister Nirmala Sitharaman said in her Budget 2021 speech on Feb. 1, 2021.
The programme will require an increase in funding from the government as well as the financial sector, she said. For this, the government is proposing to take three concrete steps:
- Creating institutional structure
- Big thrust on monetisation of assets
- Enhancing share of capital expenditure in central and state budget
Building new roads, rail links and other social and economic infrastructure is key for attracting investments and making India a $5-trillion economy. The NIP—jointly funded by the central government (39%), state government (40%) and the private sector (21%)—aims to invest in projects spanning across sectors such as energy, social and commercial infrastructure, communication, water and sanitation.
Besides, the government will set up a new development finance institution called the National Bank for Financing Infrastructure and Development. This will be set up on a capital base of Rs 20,000 crore and will have a lending target of Rs 5 lakh crore in three years, Sitharaman said.
“Infrastructure needs long-term debt financing. A professionally managed development financial institution is necessary to act as provider, enabler and catalyst for infrastructure financing,” the finance minister said.
Other key announcements:
- A national monetisation pipeline of potential brownfield infrastructure assets will be launched.
- An asset monetisation dashboard will be created for tracking the progress and to provide visibility to investors.
- NHAI and PGCIL to set up infrastructure investment trust to attract global funds. Five operational roads with estimated enterprise value of Rs 5,000 crore are being transferred to NHAI InvIT.
- Transmission assets worth Rs 7,000 crore to be transferred to PGCIL InvIT
- A sharp increase in capital expenditure — Rs 5.54 lakh crore for 2021-22, which is 34.5% more than budget estimate of 2020-21.
- To provide more than Rs 2 lakh crore for states and autonomous bodies for their capital expenditure.