India’s global competitiveness has been limited by a logistics sector that lags behind the country's emerging needs. Whether turnaround times in ports or slow road transport times, India’s transport and logistics sector’s constant improvement is necessary to prevent economic bottlenecks.

In this context, the 2022 Union Budget presents a clear infrastructure push, building on the previous two budgets. The PM Gati Shakti National Master Plan is an INR 100 lakh crore master plan for coordinating between big-ticket infrastructure projects such as Sagarmala, Bharatmala, UDAN etc. It incorporates an all of the government approach and stresses multimodal connectivity as being key to the country’s economic prospects. The 2022 Union Budget aims to construct 25,000 kilometres of national highways in 2022-23, almost double of the previous year.

Underlining the importance of public investment for modern infrastructure, seven engines of growth have been identified: roads, railways, airports, mass transport, waterways, and logistics infrastructure. Along with logistics efficiency, complementary roles of IT and communications, bulk water and sewerage, social infrastructure, and clean energy have been highlighted. Another significant announcement is the setup of 100 cargo terminals under the PM Gati Shakti. Transport and logistics infrastructure is a big constituent of the broader capital expenditure budget, estimated to be around 2.9 per cent of GDP.

This blog was authored by Ankita Sharma.