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Budget 2021: Public-private partnerships, logistics, transport and infra

Finance Minister Nirmala Sitharaman shared that the government has prepared a National Rail Plan for India – 2030, and that major ports will be moving from managing their operational services on their own to a model of Public-Private Partnership

Budget 2021: Public-private partnerships, logistics, transport and infra

Monday February 01, 2021 , 3 min Read

With a focus on reviving the economy, the government has announced a few key proposals to push for Infra Development. Announcing the Union Budget 2021, Finance Minister Nirmala Sitharaman shared that the government has prepared a National Rail Plan for India – 2030.


"The plan is to create a ‘future ready’ Railway system by 2030, bringing down the logistics costs for our industry is at the core of our strategy to enable ‘Make in India’," she said. She announced that 100 percent electrification of all Broad gauge routes will be completed by December 2023.

Nirmala Sitharaman


The FM said that by 2030, the government also plans to boost the share of public transport in urban areas, and a budget of Rs 18,000 crore has been laid out for the same.


"We will work towards raising the share of public transport in urban areas through expansion of metro rail network and augmentation of city bus service. A new scheme will be launched at a cost of 18,000 crores to support augmentation of public bus transport services. The scheme will facilitate deployment of innovative PPP models to enable private sector players to finance, acquire, operate and maintain over 20,000 buses. The scheme will boost the automobile sector, provide fillip to economic growth, create employment opportunities for our youth and enhance ease of mobility for urban residents," she said.


Zooming in on transport, the FM also added that the National Highways Authority of India (NHAI) will be encouraged to pursue “greater commercialisation of highways to raise finance”. Besides proposing highway works in several states such as Tamil Nadu, West Bengal, Kerala and Assam, the Minister also mentioned that the eastern and western dedicated freight corridors will be commissioned by June 2022. Moreover, a section of these will be made through the public-private partnership model, with the Indian Railways also monetising these corridors.


For the National Infrastructure Pipeline (NIP), the government said in the last budget that it would spend Rs 103 lakh crore over a five-year-period across 65 projects spanning various sectors such as housing, energy, healthcare, clean water, irrigation, transport terminals, logistics, and warehousing. The FM did not mention any details about the ongoing National Logistics Policy work that was announced in the last budget, which was about creating a single-window e-logistics market and on the generation of employment, skills, and making MSMEs competitive.”


The FM also added that major ports will be moving from managing their operational services on their own to a model where a private partner will manage it for them. For this purpose, seven projects worth more than Rs 2,000 crores will be offered by the major ports on Public-Private Partnership mode in FY21-22.


On these announcements, Vipin Sondhi, MD & CEO, Ashok Leyland said that the commitment to augment our country's road infrastructure with projects for building 8,500 km of highways and economic corridors augurs well for surface and road transport. Secondly, a Rs 18,000-crore scheme to augment public transport in urban areas with the addition of 20,000 new buses in a PPP model would ensure cleaner and efficient public transportation and ease congestion.


"Overall the budget presented during these difficult times has laid emphasis on increasing economic activity and is a step in the right direction for renewed economic resurgence," he added.



For YourStory's multimedia coverage of Budget 2021, visit YourStory's Budget 2021 page or budget.yourstory.com

Budget GIF Final

Edited by Anju Narayanan