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Highway Quality and Length can bolster our Manufacturing growth

Prof. Prem Vrat   &  Prof. Ravindra Ojha

The five million kilometers of road network in India is currently capacity constrained, slow, less safe, environmentally unfriendly, not maintained well and patchily administered. For India’s economic growth, the quality of roads and the length of its new-construction which facilitate the movement of tones of goods and market accessibility has become a necessity today. Improvement in transportation efficiency brings down the logistics cost, making the product more cost-competitive thereby encouraging economies-of-scale, which in turn provides the impetus to manufacturing growth and the make-in-India drive.A well-developed National Highways (NHs) network reduces the effect of distances, improves the flow of goods and people, integrates the existing markets, creates new markets, facilitates labor-productivity, enhances people’s aspirations, smoothens the flow in export and import, encourages potential investors to invest and reduces income inequality, which eventually lead to enhanced manufacturing competitiveness. Quality highways primarily engaged in freight movement facilitate the economy in reducing the lead-time of processes, improve inventory-turns, bring reliability in delivery, reduce vehicle fuel-consumption and environmental pollution.

 

 

More than 60% of the freight traffic is carried by the Indian roads. The NHs with only1 lakh kmsof length take up 40% of freight traffic.The logistics cost in India is 13-14% of the GDP, which is much higher than 11% in Europe, 9% in US and 11% in Japan.The average vehicle speed is 20-21 kms / hour on highways in India and a truck can cover only 250-400 kms / day as compared to 700-800 kms in developed countries. A reported study has indicatedthat a substantial amount of journey-time is wasted in the unwanted stoppages which include delays caused by the interstate check-posts.An analysis of the road transport factors over the period 2000-2014 in India has indicated that the growth in total road and NH lengths have not been able to keep pace with the growth in manufacturing output and freight movement indicating a strong need for bridging the growing gap quickly.According to the then Planning Commission study, in India a 1.2% increase in road traffic adds to a whole percentage point to the economic growth.The huge road-asset base worth 10,300 billion INR, the increasing freight movement in terms of Billion Tonnes Kilometre (BTKM), overloading of vehicles, inconsistent and severe weather conditions, reducing freight-vehicle speed which is already low, demands a holistic maintenance system. In summary, the road infrastructure needs a massive revisit.

Fives pecific recommendations based on authors’ analysis are; (i)Develop a dynamic highway quality database and a sound maintenance strategy because this high-value asset has become an operating necessity in for giving priority to manufacturing in the nation. Carry out the segmentation of the NH based on classes of road for repair and maintenance as the same level of maintenance is not needed for the entire length.(ii) Optimize the repair and maintenance of highways by providing sufficient governmental funds to operate at a minimum of 75% of its requirement.(iii) Ensure repair and maintenance completion within six months  of its generation for Bitumen surface and twelve months for Concrete surface highway.(iv)Invest in Concrete highways for all future expansion of highways.Based on funds availability from the government,a gradual transition from the Bitumen to Concrete highways is recommended.(v) In order to facilitate improvement in the average vehicle-speed, in addition to highway surface quality, the need for a singular GST implementation is an operating necessity.

 

 

 

Construction of new highways to enhance manufacturing growth is a necessary but not a sufficient condition for ensuring manufacturing growth. Absence of it would have an adverse effect but presence would only marginally impact the growth for which many other enabling policy parameters are to be in place.The construction of new highways in the carefully chosen less accessible areas and villages will enable to explore new markets for growth. It should facilitate in integrating dispersed markets, creating new markets and improving accessibility to add to the growth of manufacturing sector of India.

 

 

Prof. Prem Vrat,  Pro-Chancellor, The North Cap University, Gurgaon

 

 

 

 

 

Prof. Ravindra Ojha, Director SOET, The North Cap University, Gurgaon

 

 

 


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