Infrastructure Financing in India- a Review

Abstract

Infrastructure is a critical determinant of investments, manufacturing depth, logistics, productivity, inclusive development, national integration and poverty reduction. Insufficient capacity across infrastructure sectors leads to a widening infrastructure gap, resulting in lower productivity, higher transport and logistics costs, reduced competitiveness, and slower growth. Infrastructure also plays a great role in accelerating economic development of a country. Infrastructure is the capital of an economy. It is a component of capital stock that promotes development by linking the production points with input supplies including lab our through transport and communication. Infrastructure helps in reducing poverty, promotes development and facilitates functioning of economy. Indian planners are fully aware of the link between infrastructural facilities and general economic development and accordingly, they gave high priority to the rapid expansion of these facilities right from the first plan itself. The investments made by government on infrastructural facilities could be easily justified since they have provided for necessary agricultural development and industrial expansion. There has been threefold rise in agricultural production and seven fold rise in industrial production