What is National Infrastructure Pipeline (NIP)? Suggest measures to boost investment through NIP to upgrade infrastructure for a $5 trillion economy.
- January 18, 2021
- Posted by: OptimizeIAS Team
- Category: DPS Topics
NIP is a first-of-its-kind initiative to provide world-class infrastructure across the country and improve the quality of life for all citizens. It will improve project preparation, attract investments (both domestic & foreign) into infrastructure (social and physical), and will be crucial for attaining the target of becoming a $5 trillion economy by FY 2025.
Body: Mention Atanu Chakraborty Report which recommended NIP and the suggest committees as well as other measures.
Measures to boost investments through NIP:
Atanu Chakraborty Report noted need of 111 lakh crore over the next five years (2020-2025) to build infrastructure projects and drive economic growth.
- The centre (39 percent) and state (40 percent) are expected to have an almost equal sharein implementing the projects, while the private sector will have 21 percent share. NIP will channelize all this investment.
- Aggressive push towards asset sales.
- Monetisation of infrastructure assets.
- Setting up of development finance institutions (DFIs funded 20-25% of infrastructure investments during 2013-2018). DFIs in the state levels need to be increased)
- Strengthening the municipal bond market.
Other measures should be:
Setting up of a suitable mechanism to facilitate infrastructure asset monetisation, with a focus on State and city-level projects
Extension of the existing credit guarantee facilities for infrastructure projects, either through the proposed Credit Guarantee Enhancement Corporation or any other similar entity
Exploring tax exemptions/reducing tax for large investment to incentivise investment
Policy reforms for individual sectors: Ex- DISCOMs disburdening
Other measures which will attract investment: Appropriate regulatory & tariff setting mechanisms for specific sectors, streamlining land allotment, approvals, contract enforcement & renegotiation and dispute resolution practices for infrastructure projects.
Infrastructure investment can be the growth multiplier towards $5 trillion and also bring India out of current economic slowdown.