However, the key that is expected to open the door to economic recovery is infrastructure investments. In the short-term, there is a clearly articulated policy of public expenditure-driven, infra-investment-based stimulus. It is thus quite surprising that no macroeconomy commentator has yet been critical of the one vital missing statistic that should reveal where the economy is headed - viz Gross Capital Formation in Infrastructure (GCFI), most often expressed as a percentage of the GDP.
It was around 2005 that this columnist started badgering policy and economic czars in New Delhi to concentrate on this statistic, and to collate and publish it and use it as an important indicator to judge the direction of the economy. Persistent reminders succeeded in finally catching the attention of Montek Singh Ahluwalia, and the 11th Plan onwards (2007), GCFI came to be included in any discussion, plan or impact-evaluation of the infrastructure sector led by the then Planning Commission. (INVESTMENTS IN INFRASTRUCTURE)
However, much of the energy on this crucial statistic appears to have been dissipated, as can be seen from the table above. Again we have no clue whatsoever of infra investments - sectoral and overall - in the last three years.
If the five-year planning process were still around, we would have been well into the fourth year, having completed three years from April 1, 2012 to March 31, 2015. But ask any economic mandarin how well we are doing in terms of investments in various infra sectors or even as a percentage of the GDP, or as a percentage of public-private-partnership (PPP) to total investments, and all you get is a glassy look. That is disconcerting, considering that the broad economic norm is that a country like ours, at this juncture of the development cycle, needs to put in eight per cent to 10 per cent of its GDP in infrastructure. So, GCFI becomes as important a statistic as GDP, and needs to be taken as seriously.
So, if infra investments are the fulcrum on which the India story is to turn, surely we cannot operate in a statistical vaccum. This is not to suggest that only a "revived" Planning Commission can do this. It is simply a job of collating information in a rigorous and regular manner and using it for appraisal, analysis and (hopefully!) deriving policy measures. Different wings of the government of India have the calibre and expertise to do it - be it the NITI Aayog, Ministry of Programme Implemen-tation and Statistics or the Department of Economic Affairs in the finance ministry. But somebody in the system has to take ownership.
In any case, infra targets and their evaluation require recasting for the following two reasons.
One, targets have morphed. Plans for renewable energy, railways, highways, water resources, transmission and distribution et al are quite different now from the time when the 12th Plan was being drawn up. New targets, reflecting current realities and the priorities of the government of the day need to be represented in a fresh format.
Two, with the fading away of the five-yearly planning cycle, a new time frame needs to be adopted. A practical period for target-setting could possibly be the term of the present government, that is 2014-2019.
Whatever the chosen targets and the investment period under the scanner, it should be worked upon immediately. Otherwise decisions related to the infrastructure sector would only be as focused and purposeful as the old allegory of a blind man in a dark room looking for a black cat that is not there.
The author is the chairman of Feedback Infra. vinayak.chatterjee@feedbackinfra.com;
Twitter: @Infra_VinayakCh
Twitter: @Infra_VinayakCh