INFRASTRUCTURE: A comparative study between India and China

Posted by | October 19, 2006 | Life - INXS | One Comment

Picture this” I was driving down the Chennai IT Express highway, one hour well in advance for a strategic meeting to be held in one of the prominent business establishment in Tidel Park, well I was well prepared for all the questions to be thrown at me by the members of the panel and for the presentation.  I was comfortable and very much looking forward for the meeting and ‘screech’ the car stops…I enquire and find that there is a traffic jam caused by one of the major pot holes on the highway, a ‘tempo’ seems to have driven right into it, and badly stuck and since all the big vehicles were trying to get through all at the same time, the chaos had started.  Well there was no traffic police in sight and someone said that a SOS had been sent to them about half an hour ago.  The fumes and heat were unbearable, what was most frustrating was that I was losing precious time and my entire project depended upon the meeting, the time ticked away increasing my heart beat to a extent that I could hear it in my ears.  Well the traffic took about an hour to clear and along with it my future was clear…there goes my meeting and my contract”.  Ok you people out there tell me, who’s fault was it anyway, mine…but I started well before time, the vehicle which I was travelling was good and was not cause of trouble, well you might ask what about traffic, but none of this would have happened if there was no pot hole…so finally who is at fault, well it is the Government of course! They have provided us with such pathetic infrastructure.  Thanks to the bureaucracy and red tapism, which is still prevalent in the country, we get to use such sub standard infrastructure, be it in the form of bad roads or poor power supply.  With all the efforts that we have put forth (by we I mean the ‘band’ of tech. Start up companies) we come to hurdles, which are put forth by our own Government.  I find that in other countries, the Government are more than willing to attract investments by providing the start up companies with all the help in the form of good infrastructure.

Why then why does our Government turn a blind eye towards our need? Don’t we want to prove our best and do our part to the country then why in the name of God does the Country itself pose a threat and hurdle to us?  I am speaking out of frustration, because the likes of me have put their best foot forward both in the form of investment and knowledge but the Government fails to recognise this and in turn wants to restrict our growth?

Infrastructure is the backbone of any economy.  Indian economy should necessarily concentrate on Infrastructure if it needs to be classified under   the label of ‘developed economy’.  What inspiration can India draw to better its infrastructure facility, obviously the answer is China, being the nearest neighbour and being ‘similar economy’ to that of India.  China has all the problems, which India faces, be it on the macro level or micro level but yet it has surpassed all these and has emerged as a successful economy and well onto the path of development.  Let me analyse as to what changes did China incorporate within itself to make such a change possible, or where did India fail to incorporate these changes.  stronger.

Infrastructure is the backbone of any economy.  Indian economy should necessarily concentrate on Infrastructure if it needs to be classified under   the label of ‘developed economy’.  What inspiration can India draw to better its infrastructure facility, obviously the answer is China, being the nearest neighbour and being ‘similar economy’ to that of India.  China has all the problems, which India faces, be it on the macro level or micro level but yet it has surpassed all these and has emerged as a successful economy and well onto the path of development.  Let me analyse as to what changes did China incorporate within itself to make such a change possible, or where did India fail to incorporate these changes.  Well this article is going to concentrate on all those aspects and more and also try and find out the possible solution to make the backbone of India stronger.

Let me take example of the steps taken by China, that of India and what are the various methods that India can adopt to surpass or at least equal China in its developmental efforts. One of the important sectors in Infrastructure development is Roadway and China is making a great headway with its expressways.  Some of the important expressways are

Changde-Jishou Expressway, Changde- Zhangjiajie Expressway that interconnects the province of Hunan.  Similar expressways exist in Sichuan Province and Shanxi Province and other provinces, but of course the Indian quadrangle project is also one of the best but one should try and analyse not only highways or Expressways but even the inner roads because like how ‘capillaries are important in blood vessels’ inner roads are also important and needs to be improved upon.

You and I would have learnt in our school about centralisation of all the decision being one of the hurdle in the ‘nation building’ activity, but fortunately now decentralisation is ruling the roost, now state government have become the major decision bodies.  Hence these state governments are vying with each other to improve their own cities, be it in the case of Tech. Park or infrastructure, one of the cities, which had made mark on these basis, was Hyderabad closely followed by Bangalore and Chennai.  But yet the efforts are not enough and much has to be done to attract investment.

Why is it that India has not achieved what China has in terms of Infrastructure, what is the block that is there with the Government that has been such a big hurdle? Well the answer to my question was answered by Mr. Kapil Sibal(Minister for Science and  Technology) himself during the ‘China Business Summit 2006’  According to him We cannot built a Pudong overnight, because unlike China, India is a home consumption based economy and not export led economy.  Emphasising on ‘quality’ Sibal was of the view that while China is a state led economy, India is a market led economy and there is no way that we can displace thousands of people overnight to built a highway or to commission a power supply, it simply does not work that way.  But on the positive note he feels that India would definitely surpass China in the coming years, one reason that there are many young people below the age of 25, and hence the future productivity at least by the year 2030 is high, with populating dwindling in other parts of the world, it would be easy to absorb the productive labour force of India thus leading to an increase in cross culture economy in the coming years.   Yes I do agree with Mr. Kapil Sibal that India is a market led economy and that it is a consumer led economy, but efforts need to be put in now so that we could reap the benefits later.  The gestation period of any infrastructure project is quite long and hence it is very important that investments and proper investment (without bureaucracy involved) be put forth right now.  You might ask what is the suggestion that I give such that the situation is improved.  Well for one since the laying of roads are given through tenders in our country, a clause should be added in these contracts that the maintenance of these roads are also borne by the person or organisation for whom the tender has been awarded.  This would make maintenance of the roadways much more efficient and simple.  Secondly a clause should also be introduced wherein after the new roadway has been laid, for about a five year time no laying of cables or sewage work be conducted except of course in case of emergency, this would ensure that the roads are well maintained and not full of pot holes and unexpected speed breakers (in the form of uneven roads).

It is quite obvious that town planning in our country especially in our city has gone to the dogs, with a building coming up every second day, without even checking if the sewage system or the electric power cables in that area are capable of taking the loads.  Along with new buildings come sand, stones and what not are spilt on the roadways, making the already congested roads smaller.  Why is it that the Government does not bring about a rule or enforce a fee for such offenders?

Ok let me provide you with some hard-core details.  According to Bloomberg.com, India is emerging as the second largest economy in Asia after China. The growth rate of India is set at 8.4%. It is believed that with poor infrastructure when India can grow at the rate of 8%, then it might very well grow at the rate of even 12% with good infrastructure facilities.  India has the strong base to attract consumer goods investments, retail outlets like that of Wal-Mart, Hindalco is planning to spend around $7 billion.  India’s steel growth is aimed to grow around 110 million tonnes by 2020 to aid the infrastructure facilities.  Thus what India needs right now is planned investment such that these investment help the country to increase its growth at the same time is a source of building the infrastructure facilitates.  Those foreign investments should be invited which would also help in building the various infrastructure facilities.  Kindly note that as an IMF official had strongly suggested that Foreign reserves should not be used for building infrastructure facilities and only earning from the various investments need to be used.

Do you know that at present only 5.5% of the GDP of India is spent on Infrastructure, this figure needs to be increased to about 7%.  Let us take China now…well let us take China in the initial stages where it started, according to the National Bureau of Statistics (NBS), the Chinese Government had initiated the Primary industries and try to strengthen China’s infrastructure.  The report said that from 1989-2001 (please be informed that this was the initial years of China’s development).  The Government of China had spent about 6.3 trillion Yuan (about 761 billion US dollars) into 1553 infrastructure projects covering various sectors like that of transportation, animal husbandry, fisheries, energy, raw materials, postal and telecom services and other public services. Well the investment at the moment in China is so huge, that I don’t even want to compare the figures.  Well to give you an insight, Chinese Infrastructure has even trickled down to the inland cities like that of Chongging.  China is all set to follow Tokyo as far as investment in infrastructure is concerned.  As for India, I just hope that this type of investment starts at the earliest.

Well to summarise everything, I want to contribute towards the development of my country and I am sure that scores of others also feel the same way, but is it not the duty of the Government to provide us with good infrastructure to help us?  Or in other words, India should welcome at least those foreign investments, which would bear the burden of some of the infrastructure building.  The advantage is that the huge investment required would be shared and also it is good for the long-term development of both the project and the country as well.  And as suggested earlier Indian government should bring about a maintenance clause in the tenders awarded to contractors.  This I understand is a long-term process and cannot be done overnight but the Government should take steps towards the same and implement some of those immediately such that we could attract many investments into the country.  Guess I have spoken the minds of many others and am assured that the Government would soon take steps and try to bring about some form of arrangements such that frustrations experienced by me and many others are put to rest!

SOURCES:

1. India Business week

2. Bloomberg.com

3. English.peopledaily.com

One Comment

powered by
Welcome! Let me know how I can help you!