The present BJP Government, on 1st February, 2019 presented the Union budget for the fiscal year 2019-2020. With the Lok Sabha elections approaching, the Government has tried to cover all the aspects it had promised to work on, infrastructure and national security being the two most emphasized upon areas in this budgetary allocation. In tune with the promises of bringing about revolutionary infrastructural changes and developments, a hefty sum of Rs.4.56 lakh crore has been allocated under the union budget for the Infrastructure Sector which includes roadways, railways, shipping and aviation, for the financial year 2019-20.
During the budget presentation, the Interim Finance Minister Mr. Piyush Goyal was quoted saying, “Infrastructure is the backbone of any nation’s development and quality of life. Whether it is highways or railways or airways or even digi-ways, we have gone beyond incremental growth to attain transformative achievements.” Indeed, the Infrastructure Sector is the most tangible evidence of a nation’s development and a major push to the national economy. The major takeaways from the budgetary allocation 2019-20 for the Infrastructure Sector are as follows:-
A total of Rs. 4.56 lakh crore was allocated to the Infrastructure Sector wherein the railways saw a 21% increase and the Aviation Sector witnessed 54% cut as compared to the previous year budgetary allocation.
A big sum of Rs. 1,58,658 crore was allocated as the capital expenditure for the railways, up from Rs 1,38,857.52 crore in 2018-19 whereas the expenditure on the ‘Rashtriya Rail Sanraksha Kosh’ (Railways safety fund) remained the same i.e., Rs. 20,000 crores.
The roadways were allocated a slightly increased sum of Rs. 83,015 crores even though the Government had pledged to bring connectivity to every ‘unconnected’ village. An upgraded allocation of Rs. 19,000 crore was made on rural roads under the ‘Pradhan Mantri Gram Sadak Yojana’ (PMGSY) from a sum of Rs. 15,500 crores in 2018-19.
The Government had a narrative of creating a blue economy and bringing back the inland waterways. In pursuance of the same, Rs. 1902 crore have been allocated to the shipping industry. Furthermore, Rs. 550 crore has been allocated for port and coastline development under the flagship programme named ‘Sagarmala’, as against Rs. 381 crore in 2018-19. Though the inland waterways was allocated funds reduced by about 15% as compared to the previous year allocation. Funds allocated for inland waterways were at Rs 891.13 crore in 2018-19, which has been reduced to Rs 757 crore for 2019-20.
The Aviation Sector was allocated Rs. 4500 crore. The Aviation Sector is witnessing dynamic changes with the revised FDI norms and new private players in the market, the Government seems to be playing it safe in this sector since the Aviation Sector has too much in its hands to handle as of now like reviving the national carrier Air India and fulfillment of its promise of maximum regional connectivity.
As we analyze the present budget allocation in the Infrastructure Sector, it becomes very evident that the present Government is looking at making major changes in the Infrastructure Sector and development of the economy. It was also the first time that the use of electric vehicles was mentioned in a budget aiming at renewable energy boosted transportation by 2030, which is the need of the hour.
In the present time where a number of the power and infrastructure companies are either insolvent or on the verge of insolvency, the Government’s initiative of allocating a huge sum on infrastructure is welcome change for the Sector and one hopes that this would boost the Infrastructure, Banking and Financial Sector.
The Indian Lawyer