Chapter 8 Infrastructure

8.1 Introduction

The varying levels of development across different states in India can often be attributed to the quality of their infrastructure. For instance, states like Punjab and Haryana excel in agriculture due to robust irrigation and transport systems, while Maharashtra and Gujarat are industrial powerhouses, partly because of their port facilities and strong transport networks. Similarly, Kerala's high standards in literacy and health are a result of its strong social infrastructure, and Bengaluru's status as an IT hub is built on world-class communication facilities.

These foundational support systems are collectively known as infrastructure. They are the backbone of a modern economy, and understanding their role is crucial to understanding the development process itself. This chapter explores what infrastructure is, its relevance, and its current state in India, with a special focus on the energy and health sectors.

8.2 What Is Infrastructure?

Infrastructure refers to the network of fundamental facilities and systems that provide supporting services essential for the functioning of an economy. These services are vital for industrial and agricultural production, as well as domestic and international trade.

Infrastructure is generally divided into two main categories:

1. Economic Infrastructure: This includes facilities and services that directly support economic production.
   • Examples: Energy (power stations, pipelines), Transportation (roads, railways, ports, airports), and Communication (telecommunication facilities).
2. Social Infrastructure: This includes facilities and services that improve the quality of human resources and contribute indirectly to economic development by building a healthy and skilled workforce.
   • Examples: Education (schools, colleges), Health (hospitals, sanitation, clean drinking water), and Housing.

Both categories are interdependent and crucial for the balanced development of a nation. For example, a strong health and education system (social infrastructure) is necessary to create a productive workforce that can operate and manage the economic infrastructure efficiently.

8.3 Relevance Of Infrastructure

Infrastructure is the bedrock of a modern economy. Its relevance stems from its ability to enhance the productivity of all factors of production (land, labor, and capital) and improve the overall quality of life for the population.

• Boost to Agriculture: Modern agriculture relies heavily on infrastructure for irrigation, as well as the transport of seeds, fertilizers, and produce. Banking and insurance facilities are also crucial for managing large-scale farming operations.
• Support for Industry: Industrial progress is contingent on the reliable supply of power, electricity, and efficient transport and communication networks.
• Impact on Health:
  • Improved water supply and sanitation directly reduce the incidence of waterborne diseases, thereby lowering morbidity (the rate of illness in a population).
  • Efficient transport and communication systems improve access to healthcare facilities, especially during emergencies.

Conversely, inadequate infrastructure acts as a major bottleneck to economic development, hindering productivity, affecting public health, and reducing the overall efficiency of the economy.

Work This Out

In any locality, we use a wide range of infrastructure daily. This includes roads for travel, electricity for homes and businesses, water supply for drinking and sanitation, telephone and internet for communication, schools for education, and hospitals or clinics for healthcare. Often, communities may feel the need for additional infrastructure, such as better public transport, more reliable power supply, a community park (social infrastructure), or improved waste management systems.

8.4 The State Of Infrastructure In India

Traditionally, infrastructure development was considered the sole responsibility of the government. However, due to the massive investment required, government funding has often been inadequate. In recent years, the private sector has started playing a significant role, both independently and through Public-Private Partnerships (PPPs).

Despite progress, there remains a significant deficit in India's infrastructure, especially in rural areas. Census 2011 data reveals a stark picture:

• Only 56% of rural households had an electricity connection.
• About 85% of rural households relied on biofuels (like firewood and dung) for cooking.
• Tap water was available to only 31% of rural households.
• Access to improved sanitation was just 30% in rural areas.

India's investment in infrastructure, at about 30% of its GDP, lags significantly behind countries like China (44%). For India to achieve its goal of becoming one of the world's top economies, a substantial boost in infrastructure investment is imperative.

As economies develop, their infrastructure needs evolve. Low-income countries prioritize basic infrastructure like irrigation and transport. In contrast, high-income countries require more service-related infrastructure, such as advanced telecommunications and power grids. This shows that economic development and infrastructure development are intrinsically linked.

Work These Out

Terms like Bharat Nirman (a time-bound plan for rural infrastructure), Special Economic Zones (SEZ) (areas with business-friendly policies to promote exports), and models like Build-Operate-Transfer (BOT) and Public-Private Partnership (PPP) are all related to infrastructure development. They represent various government strategies and financing models designed to accelerate the creation of infrastructure by involving the private sector.

8.5 Energy

Energy is a critical input for nearly all economic activities. It is essential for industries, agriculture (for running farm equipment and producing fertilizers), and households (for cooking, lighting, and heating). The development process is fundamentally linked to the availability and use of energy.

Sources Of Energy

Energy sources can be categorized as follows:

Non-conventional Sources Of Energy

These are emerging sources of energy that are renewable and environmentally friendly. As a tropical country, India has immense potential for developing these sources.

• Solar Energy: Harnessing energy from the sun.
• Wind Energy: Using windmills to generate electricity.
• Tidal Power: Generating energy from the movement of ocean tides.

Consumption Pattern Of Commercial Energy

Commercial energy constitutes about 74% of total energy consumption in India. The major sources are coal (74%), followed by oil (10%) and natural gas (9%). The sectoral consumption pattern has shifted over time. While the transport sector was the largest consumer in the 1950s, its share has declined, whereas the shares of households and agriculture have increased significantly.

Power/Electricity

Power, or electricity, is the most visible form of energy and a crucial component of infrastructure. For India to achieve an 8% GDP growth rate, its power supply needs to grow by about 12% annually.

Sources of Power Generation (2018):

• Thermal Power (from coal, oil, gas): Dominant source, accounting for 82%.
• Hydropower (from water): Accounts for 8.5%.
• Nuclear Power: Accounts for only 2.5%, far below the global average of 13%.
• Renewable Energy (Solar, Wind): Contributes 7%.

Some Challenges In The Power Sector

India's power sector faces numerous challenges:

1. Insufficient Capacity: The installed capacity to generate electricity is inadequate to meet the rapidly growing demand. India is currently able to add only about 20,000 MW per year, while the need is much higher.
2. Losses of SEBs: State Electricity Boards (SEBs), which handle distribution, incur massive losses (over ₹20,000 crores). This is due to:
   • Transmission and Distribution (T&D) losses: Power is lost while being transported from power stations to consumers.
   • Power theft.
   • Wrong pricing: Providing subsidized or free power to certain sectors, like agriculture.
3. Limited Private Sector Role: The participation of private and foreign investors in power generation is still limited.
4. High Tariffs and Power Cuts: This leads to general public unrest and hampers industrial activity.
5. Raw Material Shortages: Thermal power plants frequently face shortages of coal.

Box 8.2: Power Distribution: The Case of Delhi

The experience of privatizing power distribution in Delhi highlights the complexities of reform. While it was expected that handing over distribution to private companies would lead to significant improvements, the results have been mixed, with issues related to tariff structures and consumer satisfaction persisting. This shows that privatization alone is not a magic bullet for solving the power sector's problems.

Box 8.3: Saving Energy: Promoting The Case Of Compact Fluorescent Lamps (Cfl) And Led Bulbs

Energy conservation is as important as energy generation. A key strategy has been to promote energy-efficient lighting. Replacing traditional incandescent bulbs with Compact Fluorescent Lamps (CFLs) and, more recently, Light Emitting Diode (LED) bulbs leads to massive energy savings. The government's UJALA scheme, which promotes LED usage, is estimated to save over 5,900 MW of power, translating into significant financial savings for households and reducing the strain on the power grid.

8.6 Health

Health is a holistic concept that goes beyond the mere absence of disease. It is a state of complete physical, mental, and social well-being, enabling individuals to realize their full potential. A nation's health status is a key indicator of its development and is generally assessed through measures like mortality rates, life expectancy, and nutrition levels.

A well-developed health infrastructure is essential for producing a healthy and productive workforce. It is considered a basic human right, and it is the government's responsibility to ensure that all citizens have access to quality healthcare.

State Of Health Infrastructure

India has developed a three-tier health infrastructure system:

Since independence, there has been a significant expansion in the number of hospitals, beds, and medical professionals. This has helped in eradicating diseases like smallpox and nearly eradicating polio and leprosy.

Private Sector Health Infrastructure

The private sector has come to play a dominant role in India's healthcare system. Over 70% of hospitals and 60% of dispensaries are run by the private sector. It provides care to about 80% of out-patients and 46% of in-patients. The sector has grown largely without regulation, leading to concerns about unregistered practitioners, often called "quacks". Following liberalization, many state-of-the-art super-specialty hospitals have been set up by private players, catering to the rich and to medical tourists.

Box 8.5: Medical Tourism — A Great Opportunity

India is becoming a major hub for medical tourism. Foreigners are increasingly traveling to India for high-quality medical treatments—from surgeries to cosmetic care—at a fraction of the cost in their home countries. This sector has immense potential to earn foreign exchange for India. In 2016, over 200,000 medical tourists visited India, and this number is projected to grow significantly.

Indian Systems Of Medicine (Ism)

ISM, now known as AYUSH, includes six traditional systems: Ayurveda, Yoga, Unani, Siddha, Naturopathy, and Homeopathy. These systems are effective, safe, and inexpensive, and have the potential to solve many of India's healthcare challenges. However, little has been done to standardize education and promote research in these fields.

Indicators Of Health And Health Infrastructure—A Critical Appraisal

Despite progress, India's health indicators are poor compared to other countries. Public expenditure on health is abysmally low, at just 3.7% of GDP. India, with about 20% of the world's population, bears 20% of the Global Burden of Diseases (GBD). The GBD measures premature deaths and years lived with disability due to various diseases. A recent study shows that non-communicable, lifestyle-related diseases (like heart and respiratory illnesses) now cause two-thirds of the disease burden in India.

Urban-Rural And Poor-Rich Divide

There is a severe disparity in healthcare access in India:

• Rural vs. Urban: Although 70% of the population lives in rural areas, only 20% of hospitals are located there. Rural areas have only 0.36 hospitals per lakh people, compared to 3.6 in urban areas. Rural PHCs often lack basic facilities like X-rays or blood testing.
• Poor vs. Rich: The poorest 20% of Indians spend about 12% of their income on healthcare, while the richest 20% spend only 2%. This forces the poor to sell assets or fall into a debt trap to afford treatment.

Women’s Health

Women's health remains a major concern. The child sex ratio continues to decline, indicating the prevalence of female foeticide. A high percentage of married women suffer from anaemia, and a significant number of adolescent girls are married and have children, posing risks to both maternal and child health.

8.7 Conclusion

Both economic and social infrastructure are indispensable for a country's development. They act as a support system that boosts productivity and enhances the quality of life. While India has made considerable progress in building its infrastructure over the past seven decades, this progress has been uneven, with rural areas still lagging far behind.

As India modernizes, the demand for high-quality, environmentally sustainable infrastructure will only grow. The government's reform policies aim to attract private investment to meet this demand. However, a critical analysis of the energy and health sectors reveals a pressing need to ensure that infrastructure development is inclusive and provides equitable access for all citizens. Bridging the urban-rural and rich-poor divide in access to these essential services remains one of India's greatest challenges.

Recap

This section summarizes the chapter's key points. It defines infrastructure, distinguishing between its economic and social categories, and emphasizes its crucial role in development. It highlights the need to upgrade infrastructure, especially in rural areas, and the importance of public-private partnerships. The recap revisits the challenges in the energy sector, including the gap between demand and supply, and the potential of non-conventional sources. It also summarizes the state of India's health infrastructure, noting the significant rural-urban and rich-poor divide, the poor state of women's health, and the need for a more inclusive and accessible healthcare system.

Exercises

This section contains a series of questions for self-assessment, designed to test the learner's understanding of the concepts discussed in the chapter, such as the definition and types of infrastructure, its role in development, the challenges in the energy and health sectors, and the various systems of medicine in India.

Suggested Additional Activities

This section provides ideas for practical projects and discussions to deepen the understanding of the chapter's themes, such as surveying local infrastructure projects, tracking household energy consumption, and researching the work of key figures in India's energy sector.

References

This section lists academic books, government reports, and websites that serve as sources for the chapter and provide avenues for further reading on India's infrastructure, with a particular focus on the energy and health sectors.