Run-up to Budget 2018-19: Roads, railway construction in the slow lane

Union Budget

Actual construction of highways and rural roads has lagged the capital spending done on these two sectors, while the capital spend on railways has produced commensurate results in the first eight months of the financial year, according to the data tabled in Parliament.

About 73 per cent of the capital spend for highways has been used till November 2017, but only 33 per cent of planned highways are complete. The budget for rural roads has been spent thriftily, but only 25 per cent of planned rural roads have been upgraded, though the planned habitations to be connected has been fairly on track.

About 60 per cent of designated railway capital spending has produced commensurate results.

Roads — including highways and rural roads — and railways are one of the most capital intensive expenditures of the Union Budget, after the defence sector. While the former totals Rs 1.3 trillion, the latter alone, at Rs 865 billion, represents the biggest chunk of capital expenditure.

Rural roads under Pradhan Mantri Gram Sadak Yojana (PMGSY), with an infusion of Rs 190 billion, has been included. The Budget 2017-18 envisioned a capital expenditure of Rs 3,100 billion in the total expenditure of Rs 21.5 trillion, with capex representing about 14 per cent of the spending pie.

Capital expenditure, despite being front-loaded, could not yield desired results in construction of highways and rural roads in the first eight months of the financial year.

On the rural roads front, only 40 per cent of the budgeted amount, Rs 77 billion of Rs 190 billion, is spent till November. Although, three-fourths of habitations got connected to roads network in eight months under the PMGSY, only a quarter of road length under PMGSY-II — the part of the rural roads scheme that focuses on upgradation of existing roads and consolidation of road network around it — is complete.

Railways

Of the Rs 550 billion allocated for railways, Rs 212 billion was earmarked for the construction of new lines. Till November 2017, 56 per cent of the physical target — 2,000 km of the targeted 3,600 km — was completed.

Apart from new lines, 130 rail overbridges and 332 underbridges had been constructed in FY18 till December 2017.

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