• Infrastructure is universally acknowledged as a key driver of growth. 
• Since 2014, India’s development story has been closely linked with a strong focus on physical, social and digital infrastructure.
• Budget 2023 gives a powerful thrust to these three dimensions of infrastructure development which, put together, accelerate inclusive growth.
• Physical, social and digital infrastructure.
• Rs. 10 lakh crore (3.3 per cent of the GDP), an increase of three times from 2019, was allocated for infrastructure which indicates the government’s focus on inclusive growth.

Outlay

• The Government of India’s capital expenditure as a percentage of GDP increased from 1.7 per cent in 2014 to nearly 2.9 per cent in 2022-23.
• In Budget 2023-24, Rs 10 lakh crore (3.3 per cent of the GDP), an increase of three times from 2019, was allocated for infrastructure.
• The Ministry of Railways received its highest-ever allocation of Rs 2.4 lakh crore, approximately nine times the allocation in 2013-14.
• The Ministry of Road Transport and Highways saw a 36 per cent increase in its budget to about Rs 2.7 lakh crore.
• The direct capital investment by the Centre has been further supplemented by a one-year extension of the 50-year interest-free loan to state governments.
• It aims to encourage infrastructure investment and incentivise complementary policy actions, with a significantly increased outlay of Rs 1.3 lakh crore.

Significance of Investments in Physical Infrastructure

• The targeted infrastructure investments to various Ministries will help create vital physical infrastructure, jobs and spur private investments.
• It will improve connectivity that will accelerate the movement of passengers and freight and will also provide a cushion against global headwinds and prevailing global slowdown.
• The extension of interest-free loans to state governments will lead to decentralized infrastructure development in urban and peri-urban areas across regions.
• For example, a 66 per cent increase in allocation to the PM Awas Yojana will not only provide housing but also create jobs in rural areas.
• Investment on infrastructure development is critical as every rupee spent on capital expenditure gives 95 as a multiplier.
• In contrast, the money given through revenue expenditure gets less than a rupee for every rupee spent.
• In the last eight years, one can witness the blurring of the digital divide that existed between urban and rural areas. The world has acknowledged India’s phenomenal success in building population-scale platforms at startup speed.

Digital Infrastructure Development in India

• Digital transformation of India has been happening in two phases as follows:
• First phase: It started in 2015 led by the JAM trinity- Jan Dhan, Aadhaar and mobile linkages, and the Digital India programme. Few successful milestones in this phase of public digital infrastructure creation are as follows:
• Low-cost accessibility (Aadhaar), the success of citizen-centric services such as the Unified Payments Interface (UPI), large-scale adoption and reach (DigiLocker, MyGov), and the vaccine journey (CoWin) etc.
• This had benefited India’s populace through increasing penetration of government schemes and efficient financial inclusion.
• Second phase: It is now being led by the development, application, and large-scale expansion of cutting-edge technologies such as 5G, Internet of Things (IoT), artificial intelligence (AI), quantum computing, mechatronics, robotics, and more.
• For example, the Digital India Bhashini portal is a public digital platform hosting 260 open-source API-based AI models for machine translation, and text-to-speech conversion in 11 Indian languages and English.
• AI thus has enormous potential as a tool for breaking down language barriers in a country like India, with its unparalleled linguistic and cultural diversity, providing internet access in native languages.
• It also provides the benefits of Natural Language Processing (NLP) to MSMEs and individual innovators in the hinterlands. NLP is the ability of a computer program to understand human language as it is spoken and written.
• New announcements: The Agriculture Accelerator Fund was announced recently in the budget 2023-24.
• It will enable the Indian agricultural ecosystem (startups, businesses, and farmers) to work collaboratively and find knowledge-based and farmer-centric solutions.
• It will enormously benefit agricultural sector that employs nearly half the workforce of the Indian economy.

Investment in Social Infrastructure

• It includes education and skilling, public health and nutrition, drinking water, sanitation and other social services.
• Budgetary announcements: The total expenditure of the central government in social infrastructure has increased by 134 per cent from Rs 9.1 lakh crore in 2016 to 21.3 lakh crore in 2023 (BE).
• The budget also announced mission to eliminate sickle cell anaemia by raising awareness about the near-fatal disease and screening 7 crore people in age group of 0 and 40 yrs, immensely benefiting the affected tribal areas.
• It will also lead to a more productive and proficient workforce, reduced mortality, wasting and stunting, increased social mobility and a higher quality of life.
• All these factors contribute to a stronger and more inclusive economy and holistic development.
• Earlier efforts to boost social infrastructure: The Aspirational Districts Programme spearheaded by NITI Aayog also gave attention to backward districts through data-driven governance, resulting in consistent macro improvements in key socioeconomic indicators.
• The emphasis on digital land records under the SVAMITVA Scheme of the Ministry of Panchayati Raj, a structural reform in rural land management has also led to individual economic empowerment.
• The PM National Dialysis Programme recorded a 232 per cent expansion in the Non-Communicable Diseases clinics and 320 per cent expansion in the districts under the programme between 2014 and 2022.

Conclusion

• The concerted thrust on creation, maintenance and expansion of physical, digital and social infrastructure has emerged as a systemic focus of India’s unique development model.
• This infrastructure triad will be the enabler of growth and leveller of opportunities in the dream of a “Viksit Bharat” by 2047 and people must be kept at the focal point of this infrastructure growth story.