Infrastructure
Infrastructure
Infrastructure
KOMAL ARORA
BUILDING SERVICES
1509007
SEMESTER 9
DR.DY PATIL COLLEGE OF ARCHITECTURE
5TH YEAR, BARCH
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These infrastructure systems, which require large initial investments, are essential
for enabling productivity in an economy. Most projects are either completely
funded by the government or heavily subsidized.
According to Finances Rule, is a term that engineers, urban and country planners,
and policy makers use to describe the essential facilities, services, and organization
structures for all cities and communities.
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Without infrastructure – all those things our economy requires to function and that
we take for granted – society as we know it would not exist.
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Choate’s and Walter’s publication triggered crisis discussions and the increase in
infrastructure asset management and maintenance planning in the United States.
However, public-policy discussions had one glaring obstacle – there was not a
precise definition for the term.
“… both specific functional modes – highways, streets, roads, and bridges; mass
transit; airports and airways; water supply and water resources; wastewater
management; solid waste treatment and disposal; electric power generation and
transmission; telecommunications; and hazardous waste management – and the
combined system these modal elements comprise.”
Infrastructure is the term for the basic physical systems of a business or nation—
transportation, communication, sewage, water, and electric systems are all
examples of infrastructure. These systems tend to be high-cost investments and are
vital to a country's economic development and prosperity. Projects related to
infrastructure improvements may be funded publicly, privately, or through public-
private partnerships. In economic terms infrastructure often involves the
production of public goods or production processes that support natural
monopolies.
Public infrastructure refers to infrastructure facilities, systems, and structures that are
owned and operated by the “public,” i.e., the government. It includes all infrastructural
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facilities that are open to the general public to use. Infrastructure includes all essential
systems and facilities that facilitate the smooth flow of an economy’s day-to-day activities
and enhance the people’s standard of living. It includes basic facilities such as roads, water
supply, electricity, telecommunications, and many more.
Understanding Infrastructure
The term infrastructure was first used in the English language in the late 1880s.
The work comes from Latin roots "infra-" meaning "below" and "struere" meaning
"to build". Infrastructure is the foundation upon which the structure of the
economy is built, often times quite literally. In 1987, a panel of the U.S. National
Research Council adopted the term “public works infrastructure” to refer to
functional modes including highways, airports, telecommunications, and water
supplies, as well as the combined systems that these elements comprise.
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service to the areas it supports. Similarly, the physical cabling and components
making up the data network of a company operating within a specific location are
also the infrastructure for the business in question, as they are necessary to support
business operations.
IT Infrastructure
Many technical systems are
often referred to as
infrastructures, such as
networking equipment
and servers, due to the
critical function they
provide within
specific business environ me
nts. Without the
information technology
(IT) infrastructure, many businesses struggle to share and move data in a way that
promotes efficiency within the workplace. If IT infrastructure fails, many business
functions cannot be performed.
Types of Infrastructure
Infrastructure can be put into several different types including:
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1. Taxation
Public Infrastructure may be financed through taxes, tolls, or metered user fees.
Since public infrastructure is open for use by the general public, the general public
pays for the infrastructure facilities through taxes.
2. Investments
Public infrastructure tends to be high-cost investment projects; the returns on
which are extremely high and prosperous. Hence, such projects attract several
investment opportunities. Sometimes, private companies choose to invest in a
country’s infrastructure projects as part of their expansion initiatives. For example,
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a power and energy company opts to build railways and pipelines in a country
where it wants to refine petroleum. The investment benefits both the company and
the domestic economy.
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For example, building of rural roads will benefit agriculture as the farmers
are able to sell their products in towns where they can get remunerative
prices.
Besides, they can get some inputs such as fertilizers, pesticides and other
industrial products at relatively cheaper prices as their transport costs
decline due to improved transportation. Power plants generate both positive
and negative externalities.
The construction of power plants produces electricity which is used for
industrial helps production and commercial use and thereby helps in
acceleration of economic growth.
A power plant also produces negative externalities in the form of emission
of pollutants, especially CO2.
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Therefore, these infrastructural facilities are either built or run by the government
and public sector enterprises or if private sector is permitted to make investment in
them and run them, they need to be regulated by the government, so that they
should not exploit the consumers. For example, the distribution of electricity which
is an infrastructural service is being provided by two power Companies of Tata and
Reliance in different regions of Delhi, the electricity rates and other charges are
being regulated by an authority appointed by the government. Similarly, in
telecommunication, which is another infrastructural service, various companies
such as Airtel, Vodaphone, Idea, MTNL are providing this service of wireless
telephony (i.e., mobile service) are being regulated by TRAI.
It needs to be emphasized that good quality infrastructure is important not only for
faster economic growth but also to ensure inclusive growth. By inclusive growth
we mean that benefits of growth are shared by the majority of the people of a
country. Thus the inclusive growth will lead to the alleviation of poverty and
reduction in income inequality in the country.
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For example, micro, small and medium enterprises (MSME) are dispersed
throughout the economy and production by them and their growth require access to
quality and reliable infrastructure services to compete efficiently with large-scale
enterprises which can often build some of their own infrastructure such as
installing their own small power plants or generators. Besides, large-scale firms
can even locate themselves near ports and near transport hubs where required
infrastructure is available.
Small enterprises, on the other hand, are dispersed widely in the economy and have
to rely on the availability of the general infrastructure facilities. Thus, by building
up general infrastructure facilities helps the small enterprises to compete
successfully with large-scale industries and being labour-intensive generate large
employment opportunities for the workers. This will help to alleviate the poverty in
developing countries.
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It follows from above that the expansion of infrastructure facilities will ensure
sustained growth of employment in agriculture and small-scale rural industries and
bring prosperity in the rural areas and in this way ensure inclusive growth. Besides,
this will also help to prevent the mass exodus of the rural people to urban areas
where they cause problems of urban congestion, growth of slums and acute
housing shortage
Lack of adequate infrastructure not only holds lack economic development, it also
causes additional costs in terms of time, effort and money of the people for
accessing essential social services such as healthcare and education. Emphasizing
the importance of adequate infrastructure, authors of Economic Survey of India for
the Year 2013 -14 quite rightly write, “Rural economic growth in recent years has
put enormous pressure on existing infrastructure particularly on transport, energy
and communication. Unless it is significantly improved infrastructure will continue
to be a bottleneck for growth and obstacle to poverty reduction”. In other words, it
is the challenge to ensure strong, sustainable and balanced development through
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It may be noted that with large investment in infrastructure during the last decade
(2003-04 to 2013-14) India has become the second fastest growing economy of the
world but in the two years (2012- March 2014) economic growth slowed down and
this has been mainly due to the stalled infrastructure projects which held back
economic development. It is therefore urgently needed that infrastructure projects
be given environment clearance quickly and investment in them be speeded up if
the Indian economy is to be brought back on the fast growth trajectory.
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According to World Bank estimates, in the year 2008 developing countries made
investment of around $ 500 billion a year in new infrastructure—transport, power,
water, sanitation, telecommunication, irrigation and so on equal to 20 per cent of
GDP but the need for infrastructure investment is still large. In developing
countries one billion people still lack access to clean water, two billion people lack
access to sanitation and electric power and adequate transport facilities are still
lacking in developing countries
Airports:
Airport development is a basic infrastructure requirement for international
connectivity, especially because the demand for air travel is projected to grow
rapidly in India. There had been a significant progress of airport development in
the Eleventh Plan period with the development of four new airports at Bangalore,
Hyderabad, Delhi and Mumbai under public-private participation (PPP) mode. To
expand airport infrastructure in India, modernisation of airport infrastructure in
metro and non-metro cities and construction of Greenfield airports are under
consideration of the government.
Ports:
Ports are another important infrastructure for international trade connectivity. It is
mainly through these that the goods are exported to other countries and the goods
and raw materials are imported. Without efficient ports it is not possible to expand
foreign trade. In the Eleventh Plan period (2007- 12) some problems were faced
for expansion of the Indian ports because several issues had to be resolved for the
proposed public-private participation (PPP) in this connection. These have now
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been resolved and it is expected that in the next five years there will be significant
progress in this area. As regards minor ports which come under State governments,
there has been good progress in the Eleventh Plan period.
During 2013-14 major and non-major ports in India handled a total cargo of 980
million tonnes reflecting increase of 5.0 per cent over 2012-13. This can mainly be
attributed to an increase of 1.8 per cent in the cargo handled at major ports. In
contrast, traffic at non-major ports increased at around 9.6 per cent during 2013-14
as compared to 9.8 per cent in 2012-13.
Telecommunications:
Telecommunications occupy an important place in the modern economy. E-
commerce and E-governance require the efficiency of telecommunication services.
The companies like Amazon, Flipkart, Snapdeal are engaged in E-commerce for
sale of goods. They work through mobiles and internet network. Besides, many
BPO companies are providing outsourcing services through telecommunication.
Without the efficient telecommunication system, the business through E-commerce
and BPO is not possible. Telecommunications and the associated increase in
Internet connectivity is a productivity enhancing development and India is well
based to benefit from this.
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come into being. Business firms and even farmers can sign up for a telecom service
which provides information through SMS or E-mail about market prices and other
prevailing market conditions. This will help them to take optimal decisions
regarding their business. Banks are also providing their customers, through SMS or
E-mail, the status of their deposits and withdrawal. Besides, the banks are
providing through E-mail the information regarding investment avenues open to
them.
In the case of electricity, the quality of service has been quite poor. There have
been quite often fluctuations in voltages and often supply-cuts even in capital
city of Delhi. In UP, Haryana and other states there are interruptions of supply
for many hours compelling big companies to install their own big generators.
Besides, State Electricity Boards which are usually responsible for distribution of
electricity are running heavy losses. Prices charged by them even do not cover
variable costs of supply, let alone contributing to overhead costs.
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wheels of development without which the economy will not be able to function
properly.
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i. They help in the development of the market and all the elements within.
ii. It also facilitates large-scale production for the purpose of smooth functioning
of the economy.
ix. Infrastructures in the economy directly result in the unity of various economic
components.
x. The economy and the nation will be able to meet any emergencies that arise.
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xiv. They are a great and rich source of revenue to the Government.
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June 2015 aims to build 20 million urban homes and 30 million rural houses
by 2022.
xviii. In March 2018, construction of additional 3, 21,567 affordable houses was
sanctioned under PMAY.
xix. Highway network in the country is expected to cover 50,000 km by 2019.
All villages in India will be connected through a road network by 2019
under Pradhan Mantri Gram Sadak Yojana (PMGSY)
xx. Indian Real estate sector in India is expected to reach a market size of US$
180 billion by 2020 and US$ 1 trillion by 2030. It is expected to contribute
13% of the country’s GDP by 2025.
xxi. Services sectors such as IT and ITeS, retail, consulting and e-commerce
have registered high demand for office space driving growth of real estate
services in the country.
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spaces, that are under-performing. In essence, we should think about the best ways
to maximize our various infrastructural corridors: utility, transportation, waterways
et al.
To conclude, performance of enterprises providing infrastructural services has
been a factor in the poor performance of many developing countries including
India. Thus the case for reforming the infrastructural sectors is very strong, both
for improving their own performance and for removing the drag of an unreformed
and poorly performing infrastructure sector on the realisation of potential benefits
of reforms in other sectors.
BIBLOGRAPHY
https://mpra.ub.uni-muenchen.de/12990/1/MPRA_paper_12990
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