A healthy Infrastructure is a catalyst for a good economy. Discuss the statement in context of India. List down the key issues faced by infrastructure sector.

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A healthy infrastructure provides platform for smooth functioning of economic activity. Power, telecom, transportation etc are essential for any business or economic activity. If country wants to be on the growth path it needs to work hard on capital formation in terms of infrastructure.

According to economic survey, India needs $4.5 trillion for sustaining growth rate in India. India can meet upto $3.9 trillion the balance has to be met by private sector. But private sector is facing balance sheet crisis . Projects are facing cost overruns and time overruns. PPP model are not performing well due to lack of consensus. Projects are not getting land and forest clearances. Share of Railway in tariff is on decline due to non-competitive tariff structure.

The other problem faced by some sectors are recurring loss and debt trap. Like aviation sector is facing issues regarding taxation and telecom sector is reeling under the pressure of price war. Most of the infrastructure sector is owned by government sector and hence facing the problem of government policies like delay in policy formulation, corruption , red tapism etc.

 

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