Introduction

  • Infrastructure plays an important role in the economic growth of a country.
  • Agriculture, industry and now increasingly the services sector, depend heavily on the infrastructural facilities for their growth.
  • Infrastructure development is also crucial for the social development of a country.
  • Since the economic reforms of 1991 in India, infrastructure development has been accorded high priority by the Government.
  • Some states in India are performing much better than others in certain areas. For instance:
    • Punjab, Haryana and Himachal Pradesh prosper in agriculture and horticulture. Maharashtra and Gujarat have better industrial development as compared to others.
    • Kerala has excelled in literacy, health care and sanitation and attracts tourists in large numbers.
    • Karnataka's information technology industry attracts world attention as they provide world-class communication facilities.
    • It is all because these states have better infrastructure in the areas they excel in than other states of India. Some have better irrigation facilities. Others have better transportation facilities or are located near ports, which makes easy access to raw materials required for various manufacturing industries.
    • All these support structures, which facilitate the development of a country, constitute its infrastructure.

Infrastructure

Meaning: Infrastructure refers to all such activities, services and facilities, which are needed to provide different kinds of services in an economy.

  • Infrastructure provides supporting services' in the main areas of industrial and agricultural production, domestic and foreign trade and commerce.
  • Infrastructural services include:
    • Roads, railways, ports, airports, dams, power stations, oil and gas pipelines, telecommunication facilities, etc.
    • Educational system includes schools and colleges.
    • Health systems including hospitals.
    • Sanitary system including clean drinking water facilities.
    • Monetary system includes banks, insurance and other financial institutions.
  • Some of these services have a direct impact on the working of the system of production, while others give indirect support, by building the social sector of the economy.

Types of Infrastructure

  1. Economic Infrastructure:
    • It includes infrastructure associated with energy, transportation and communication.
    • Economic infrastructure is important to promote economic activities, i.e., production and trade of goods and services.

2. Social Infrastructure:

    • It includes infrastructure associated with education, health and housing.
    • Social infrastructure consists of the provision of all those services, which improve the quality of human resources.
  • Economic development is not a mere growth in the gross domestic product but has its social dimensions too. Therefore, both economic and social infrastructure projects have a strong bearing on the process of economic development.
  • Economic and Social Infrastructure together helps in the overall development of the economy.
  • Economic Infrastructure improves productivity levels in productive sectors such as agriculture and industry, by providing support services such as energy, transport, communication, etc.
  • Social Infrastructure improves human productivity and efficiency through facilities of education, health, housing, etc.
  • Hence, both are supplementary and complementary to each other.

Importance of Infrastructure

  1. Facilitates functioning of the Economy: The functioning of an economy depends on the existence of infrastructural facilities. Agriculture, industry and service sectors depend heavily on infrastructural facilities for their growth.
  2. Agricultural Development: The development of modern agriculture depends on infrastructural facilities (roadways, railways and shipping) for speedy and large-scale transport of seeds, pesticides, fertilizers, etc. There is also a need for insurance and banking facilities so that agriculture can operate on a large scale.
  3. Economic Development: Development of infrastructure and economic development go hand in hand.
  • Agriculture depends on the adequate expansion and development of irrigation facilities.
  • Industrial progress depends on the development of power and electricity generation, transport and communications.
  • Infrastructure contributes to the economic development of a country both by increasing the productivity of the factors of production and improving the quality of life of its people.
  1. Better Quality of Life: Well-developed infrastructure leads to a better quality of life.
  • Improvements in water supply and sanitation have a large impact by reducing 'morbidity' (meaning proneness to fall ill) from major waterborne diseases and reducing the severity of the disease.
  • The quality of transport and communication infrastructure can affect access to health care. However, air pollution and safety hazards connected to transportation also affect morbidity, particularly in densely populated areas.
  1. Provides Employment: Infrastructure helps in generating employment. Many people get employment in infrastructural projects like the construction and maintenance of roads railways, electricity plants, etc. Many more people are able to find employment in industry and trade, after the development of strong infrastructure.
  2. Facilitates Outsourcing: A country with advanced infrastructure facilities is able to read benefits from the outsourcing work. India is emerging as a global destination for BPO'S, KPO's, and call centers, etc. due to its IT support system and sound infrastructure.

State of Infrastructure in India

  • Earlier, the government has been solely responsible for developing the country's infrastructure. However, due to the inadequacy of the government's investment in infrastructure, the private sector in joint partnership with the public sector has started playing a very important role in infrastructure development.
  • A majority of our people live in rural areas. Despite so much technical progress in the world, rural women still use bio-fuels such as crop residues, dung and fuelwood to meet their energy requirements. About 90% of rural households use bio-fuels for cooking.
  • Rural people have to travel long distances to fetch fuel, water and other basic needs. As per the census 2001, only 56% of the rural households had electricity connections.
  • Tap water availability is limited to only 24% of rural households and the remaining households make use of water from open sources (like wells, tanks, ponds, etc.). Access to improved sanitation in rural areas was only 20%.
  • It is widely understood that infrastructure is the foundation of development India invests very less on infrastructure. Therefore, India needs to boost its infrastructure development.
  • Unless proper attention is paid to the development of infrastructure, it is likely to act as a severe constraint on economic development.
  • For low-income countries, basic infrastructure services like irrigation, transport and power are more important.
  • As economies mature and most of their basic consumption demands are met, the share of agriculture in the economy shrinks and more service-related infrastructure is required. This is why the share of power and telecommunication infrastructure is greater in high-income countries.