Modi’s announcement at COP26 that India will not aim for net zero until 2070 signals that in the short term, growth is likely to come first – and it is obviously difficult for richer countries to assert that India should not have a world class road network
Representative image. Reuters
One of the keys to China’s economic renaissance over the past two decades is often overlooked. Namely, he built a lot of roads.
Chinese highways have more or less tripled, from around 50,000 km in 2000 to around 160,000 km by the end of 2020. This means that in just two decades, China has added highways 20% longer than the entire American highway network. make up about 40 percent of all roads in the country.
India, too, has tripled its highways over the same period, but the network is much less impressive. They are of lower quality, narrower, less well maintained and represent only a very small part of the total road network of the country.
This is arguably one of the reasons why its economy has vastly underperformed China’s over the past 20 years: China’s GDP has grown 12-fold to reach US $ 14.7 trillion (10 £ 800 billion) by 2020, while India’s has been multiplied by six to be worth the United States. 2.6 trillion dollars over the same period.
So why has India been so much poorer in road construction? And while Prime Minister Modi has just pledged to achieve net zero emissions by 2070, is it possible to build roads and decarbonize at the same time?
India’s road problem
China’s vast road building program is immediately visible to visitors. The pace of network investment has accelerated since 2011 – the graph below shows the progress over the past decade. In addition, the Chinese plan to increase their road network by an additional 50% by 2035.
Investment in transport in China compared to OECD countries (2008-18)
On paper, it looks like India’s road infrastructure is better. The cumulative road network is 5.9 million km, which is longer than China (4.6 million km), although slightly smaller than the United States (6.7 million km). The density of India’s road network, at 1.62 km of roads per square kilometer of land, is much higher than that of the United States (0.68) or China (0.49) – although it is not surprising when you consider that these two rivals are geographically three times larger. than India.
However, the quality of India’s road infrastructure is very poor: only 3% of these roads are national highways, and 75% of highways are only two-lane. Roads are congested and road maintenance is underfunded. At the same time, 40% of the roads are dirt and more than 30% of the villages do not have access to passable roads at all times.
Many explanations have been given for India’s inadequate road investment, including lack of funds and poor project management. A 2017 Economist article blamed a contentious system that makes it difficult for the government to requisition land, as well as many stalled public-private partnerships.
We recently published an article claiming that India’s political system is another factor. Road construction is the joint responsibility of the central government and each state. The central government rewards states that are politically aligned with the ruling party, especially key supporters.
In addition, road construction requires coordination between states and central government to bypass obstacles such as land acquisition, building permits and verification of tenders, all of which can delay projects and result in huge cost overruns. Another issue is the need for green transport infrastructure. All of this requires the central government to cooperate with states from all political walks of life.
Opportunities and threats
Investing in road infrastructure can catalyze growth in two ways. Like all Keynesian investments, it increases employment, income and therefore demand throughout an economy. For a country like India with relatively low incomes and an oversupply of labor, road building can unlock growth quickly, especially in recovering from the COVID collapse. As John Maynard Keynes said of the importance for governments to increase spending during tough times: “The government should pay people to dig holes in the ground and then fill them.
Roads also make economies more productive. They make it easier for people to get to work, supply chains to function, and businesses to bring goods to market. Roads reduce transportation costs, make everyone more confident that things will go from A to B, and reduce the need for businesses to stock expensive inventory to avoid running out of supplies. According to a World Bank survey in 2014, one in ten Indian businesses believed that poor transport infrastructure was a major obstacle to their growth.
It should be noted that improving Indian roads has already increased business productivity over the past two decades, despite the poor quality of the network as a whole. We found that a 1% increase in road density increased productivity by about 0.25%. This gives an idea of what could be achieved with a larger investment.
Indeed, India is now investing more in its road network for exactly these reasons – although the United States and China are also doing so. India plans to build 40 km of highways every day in the current fiscal year and intends to increase its highways by a third over the next few years. Given a large pool of unemployed labor, the conditions are ideal for doing so. But the concern is that the same old hurdles stand in the way: A report released earlier this year by a standing parliamentary committee suggested more than 800 road projects had been delayed, for example.
Then there are carbon emissions, which have the potential to increase dramatically from both road construction and increased traffic. Modi’s announcement at COP26 that India will not aim for net zero until 2070 signals that in the short term growth should come first – and it is obviously difficult for richer countries to claim that l India shouldn’t have a world-class road network. .
That said, building roads must go hand in hand with investing in technology to reduce emissions, including more electric and hybrid vehicles and a charging network to make electric cars viable. This must not only be an investment priority for India, but for actors like the United States that are working to help developing countries go carbon-free.
If India is to harness the potential of infrastructure development to spur growth, it must both embed green transition into the agenda and examine the barriers to successful road construction. With an advanced road network, India could do much more.
The authors Uma S Kambhampati is professor of economics and school principal at the University of Reading; Subham Kailthya is Lecturer in Economics at the University of Warwick. This article is republished from The Conversation under a Creative Commons license. Read the original article.