Current Challenges in Infrastructure Development In India and How to Solve These

Table of Contents

1. Identify key problems in Infra Development

2. Solutions Proposed to Solve Land Acquisition, Environmental Issues, Project Financing, Other Issues

3. New Age Infrastructure Project Financing Options

4. New Age Construction Material and Labour Problem Solution

5. How to Cater for Project Cost Escalation During Project Execution

6. How to Make Infrastructure More Sustainable and Environment Friendly

7. Industrial Revolution 4.0 Technologies for Infra Development

8. Measures to Reduce Disputes in Infrastructure Sector

Abstract

Infrastructure Development in India is facing critical problems and despite efforts by various governments at alleviating the problem there are still several issues that remain to be solved including but not limited to land acquisition, environmental issues, project financing. India need for infrastructure is huge. Progress in Indian infrastructure has been painstakingly slow. Mobile phone coverage expansion and infrastructure develop for it is perhaps the only exception. In 10 years, India went from a communications black hole to one of the leading telecommunication networks in the world, but cant be replicated in all areas. The following white paper documents the problems and other related issues and how these can be solved.

Introduction

Until a few years ago, India's infrastructure was plagued by problems and use of outdated technology. The roads, airports, railways, ports, and power supply infrastructure were inadequate and inefficient and were all in need to capital infusion.

The market liberalisation of the 1990s, ushered in an era which was markedly different from previous era when infrastructure projects were typically financed from the limited resources of public sector, leading to inadequate capacity addition and poor-quality service. As the economy grew rapidly the pressures on infrastructure increased. As such lacklustre infrastructure became a major constraint in sustaining rapid growth and attracting investment or doing business in India. As a result, there was growing realisation of need to increase flow of private capital into infrastructure projects to maintain steady growth rate, alleviate poverty, and improve quality of life. However efforts by successive governments are still insufficient and inefficient and many challenges still remain and lot of work needs to be done to address them in the 21st century.

What

1. Identify key problems in Infrastructure development

These problems can be essentially identified and divided into urban and rural problems. Urban infrastructure problems in India is an age old problem. Infrastructure problems in India suffered from economic development policy issues with budgetary allocation failing to arrest infrastructure problems in India. Infrastructure has failed to keep pace with other areas of business development in India. The tremendous growth of Indian IT, telecommunication, manufacturing, and pharmaceutical industries and the government support have left limited scope for development of world class urban infrastructure in India.

The urban infrastructure development problems in India can be broadly categorized into urban residence; business premises power usage, urban transport, water supply, sewerage disposal, access to airport/railways/seaport/roads and bridges; development of tourism infrastructure; solid waste management; development of exclusive SEZs, effective health care system, setting up entertainment and telecommunications facilities.

On the other hand, despite India being home to around 600,000 villages and 70% of population still residing in rural India, rural infrastructure development problems in India has gone for a toss in recent years. The government of India has taken some steps to arrest the slide in rural India, such as building/upgrading of roads to connect all villages; setup civic infrastructure like community toilets and provide assistance to those who can builds private toilets, provide electricity to all villages, build reservoir/water storage tanks, setup schools wherever possible. All these steps are meant to provide regular employment to rural people as well as stop their exodus to urban areas.

Government has also started various schemes under MNREGA that ensures 100 days of employment per year to rural folk working on infrastructure projects. Also, allocation of investment under schemes like Bharat Nirman and Rural Infrastructure Development Fund (RIDF) are meant to boost infrastructure push in rural India. All these efforts are meant to alleviate infrastructure problems in rural India including but not limited to power, irrigation, drinking water, rural housing, roads, health care, education, and telecommunication.

2. Solution Proposed to Solve Land Acquisition, Environmental Issues, Project Financing and Other Issues

Issues

Infrastructure projects require lot of money, and finance is an important roadblock to achieving infrastructure goals. Infrastructure can be divided 2 types; one fully funded by government and two via public-private partnership. How land is acquired for infrastructure development is another bottleneck in infrastructure development in India. The issue of correct compensation for land has always been a source of controversy. There is usually a huge difference between amount paid and actual cost of land acquired, leading to disputes between land owners and government that sometimes drags for years delaying projects.

The ineffective regulatory framework and the sluggish pace of authorization and approvals/clearance for infrastructure projects in another issue plaguing infrastructure projects in India. Nowadays environmental protection is one of the main causes of delays in implementing infrastructure projects. Environmental Impact Assessment (EIA) of projects that must comply with revised standards of environmental protection is another issue affecting infrastructural projects in India. Not to forget the lack of assessment of negative impact of infrastructure projects on population and society on the whole also affects such projects.

Solution

1. Consent

'Consent' to sell is the most contentious issues in land acquisition be it government or private and public-partnership projects (PPP). What is the quantum of consent from only landowners or land users or both is important, besides rehabilitating and resettling the affected as proposed is the main concern. The Land Acquisition and Rehabilitation and Resettlement Bill, is meant to deal with this issue effectively.

2. Compensation

The compensation given to those from and is acquired for infrastructure development is now calculated at market price. The government's position is that the market value are notoriously low representations of the actual price of land and need to be enhanced. The government's formula is to take the highest previous sale transactions in an area and add a multiplier of four times the market price in rural areas is a fair price.

3. Support

In order to understand the position of stakeholders, institutions need to provide support be it for suggesting proposals, dialogue and/or decision-making. Institutions including think-tanks or academic research organisations use data to analyse and make recommendations; bring stakeholders together to deliberate on their position; and would be given the authority to finally take decisions.

4. Definition

The Land Acquisition and Rehabilitation and Resettlement Bill does not clearly define what constitutes 'rural' and 'urban areas. This needs to be corrected. However, this may prove to be a difficult task for the Central Government, given that each state has its own laws on development. The definition of rural and urban should be left to the concerned state governments.

5. Efficiency

Their need to be transparency, proficiency and viability in the process. Transparency in evaluation. selection and determining market price for land to be acquired for development from those who lose land is a must. Proficiency in ensuring all accept deals with less litigation within realistic deadlines is important. The deals must be viable for all with a common ground for acquirer's right to profit and compensation rights for losers.

6. Environment Concern

A number of projects have been delayed because of environment concern. Laws were modified between 1980 and 1998, many were enacted including Forest Conservation Act 1980, Environment Protection Act 1986, National Environment Appellate Authority Act 1997, and Coastal Regulation Zone Notification 1991. ?Environment Protection Act (EPA) 1986 that was enacted soon after Bhopal gas tragedy was meant to seal gaps in existing laws. It empowered central government to take measures to improve quality of environment, by setting emissions standards, regulating industry location, and protecting public health and welfare. In India, EIA was enacted in 1994, with EPA as its legislative foundation and amended, simplified regularly ever since to reduce the time required for infrastructural approvals. As per EPA Amendment Act 2007, environmental clearance for infrastructure project was mandated to 120 days from date of receipt of submission of information. Many more such mandates were promulgated.

7. Project Finance

Project gestation period is India is usually long, by which time project owners enough time to get lenders and other investors onboard once the revenue stream is certain. Future forecasts of demand, cost and industry regulations are key for prospect of project finance. ?Investors review demand for project, project risk, demand, willingness of consumers to pay for products once the project rolls. They also review future prospects for growth, demographic movements, operating costs, capital expenditure requirements, finance costs, and other such costs. The project participants must ensure that the project has all necessary approvals from local authorities, before project financing starts.

8. Identify Areas

In order to execute infrastructure projects, it is important to identify areas where government is better and where private sector is better placed. The government needs to play a balancing role in developing infrastructure projects, limiting its impact on public health and environment, provide capital that are not attractive for private investors but essential for economic development of an area. However, misplaced governmental intervention can have negative consequences.

8. Distributed Model

For infrastructure projects to meet needs of local communities, it requires effective implementation on the ground. This is difficult to achieve in a centralized model. Infrastructure projects designed in a distributed model with a local focus can have better chance to impact people’s lives. For example, installing solar panels in villages can provide uninterrupted power supply to villages at very low cost, which is far cheaper than setting up an electrical grid to supply power to remote villages.

9. Adopt New Technologies

India’s lack of legacy infrastructure gives it opportunity to select huge variety of innovative tech in infrastructural development. The country can become a fast adopter/incubator of new technologies. For example, use of distributed energy and solar power can expand power generation in India. They also help reduce the need for a centralized power grid and contribute towards the global effort to reduce greenhouse gas emissions. India has huge opportunity to benefit from large-scale economies of scale, thanks to push towards massive building of numerous solar-panel production capacity from mega to small size in recent years under National Solar Mission.

10. Focus on Project

Focus of the government must be right on developing a project not just on attracting investment. India has been traditionally a country with focus on savings. People in order to secure their future invest in insurance companies and pension funds, who in turn are eager to invest that money in infrastructure projects that ensure consistent returns on investment or ROI. It is this ROI that entices international investors and multilateral development banks to contribute in mega projects in India. What India is missing is focused projects to ensure returns. In it the high long-term sovereign rates are cause of concern. Also, corruption is a major problem, that must be eliminated. It is imperative that project focus be on ensuring people benefit from economic growth and development derived from infrastructure projects.

3. New Age Infrastructure Project Financing Options

Traditionally, infrastructure financing in India is the responsibility of the government. According to the Planning Commission, India's infrastructure investment during 10th Five Year Plan (2002-2007) was US$250 billion, in 11th Five Year Plan (2007-2012) was US$450 billion, and in 12th Five Year Plan (2012-2017), it is estimated to be US$1 trillion. During 12th Five Year Plan of the total capital outlay on infrastructure, 52 percent is anticipated to be paid by the public sector contrary to 63 percent in 11th Five Year Plan. This change in approach resulted in higher participation of private organizations. This helped government to focus on limited resources for social cause.

Innovative financing options have helped infrastructure sector to boom in India. Difficulty in ensuring consistent financial returns and weakness of macroeconomic atmosphere have diminished appetite for risk by investors towards upcoming ventures. Though the revival of the sector is possible through specific initiatives. One such being setting up the India Infrastructure Finance Company Ltd (IIFCL) in January 2006. Its objectives include increasing private sector participation in infrastructure development through Public-Private Partnerships (PPPs); Containing and reducing fiscal deficit through private sector participation and improve lending terms for infrastructure projects.

1. An Alternative

As an alternative or new age infrastructure financing option, IIFCL was setup to address regulatory norms and raise affordable long-term funding from financial markets to extend lending to infrastructure projects under PPP scheme, while keeping intermediation costs minimum. To ensure IIFCL delivered on its mandate, a detailed framework was laid to guide its project selection, approval processes, lending principles, and allocation of resources. An infrastructure committee under prime minister of India appraised and approved PPP projects. For economically justified but not commercially viable infrastructure projects, the government introduced scheme to provide capital grants of upto 40% of project cost. Between April 2006 to March 2015, IIFCL was involved in a number of projects to improve infrastructure, including :-

a)???Raised US$ 6.5 billion from domestic markets.

b)???Contributed to development of nearly 20,000 kilometres of roads including Jaipur-Kishengarh Highway.

c)????Developed several urban infrastructure projects, including Two metro-rail projects in Mumbai and one in Hyderabad and many metro rail projects.

d)???Added over 50 million tons of port capacity at 22 central sector and 57 state sector port terminals.

e)???Extended Delhi, Hyderabad, Bangalore and Mumbai international airports.

f)?????Created power generating capacity of over 40,000 MW including Four Ultra mega Power Projects at Sasan(MP), Mundra (Gujarat), Krishnapatnam (Andhra Pradesh) and Tilaiya (Jharkhand).

2. IIFL - A Special Purpose Vehicle

These initiatives spurred growth in Indian infrastructure lending by banks, which increased from US$1.4 billion in 2000 to US$173 billion in 2013. The major stakeholder in IIFCL platform was Indian government of India with Ministry of Finance and Prime Minister's Office playing key role in its launch and provided investment guarantees. Other government ministries supported IIFCL’s procedures by streamlining and simplifying their working process.

Idea behind IIFL, as a financial Special Purpose Vehicle was acknowledgement of the need and significance of building infrastructure projects in India. The government accepted that most glaring deficit in India was infrastructure deficit and investment in infrastructure projects that are financially viable but face difficulty in raising finances. The government also committed USD $1.5 billion as a guarantee to IIFCL for its first year of operation.

3. Boost to PPP

IIFL was setup to increase private investment in infrastructure through PPP. This objective has been maintained throughout by IIFCL via approval of over 340 projects that mobilise private investment in excess of US$ 110 billion. The push towards infrastructure project finance for major infrastructure projects; has now ensured PPP deals are the way forward in the Indian economy as well as in the developing world.

4. Feasibility

As a new age infrastructure project financing option encouraging private sector involvement, IIFL has helped boost efficiency as private players are more focused towards economies of scale. Another fact that cost of infrastructure on the government is reduced makes working through IIFL more feasible. Also the money saved can be further utilized on social welfare projects, the main job of a government. However, challenges remain since PPP projects are usually financed on a 30:70 ratio, the mobilisation of the requisite funding by private players is still a difficult task. However, initiatives like the standardisation of documents and processes, such as model concession agreements, model RFQ, model RFP and others, have allowed rapid rollout of PPP projects. The IIFCL raises funds by consulting Department of Economic Affairs, meaning IIFL borrowings were guaranteed by Government of India within the limits of Fiscal Responsibility & Budget Management Act 2003, ensuring that PPP turns to be the most feasible option.

5. Alignment

As a new age infrastructure project financing option, IIFCL is monitored by High Level Committee on Financing Infrastructure. Also, IIFCL has aligned with financial institutions such as Asian Development Bank (ADB), World Bank, German development bank (KfW), and European Investment Bank. IIFCL raises funds as and when required in close consultation with Department of Economic Affairs, which indicates a coordinated approach within government towards specific goals of infrastructure projects developed for public services; structural cohesion to achieve anticipated functioning; high capital intensity; longevity. However, infrastructure project funding model of IIFL takes into account capital intensity, high risk, and long project cycle precludes participation of a private investor seeking faster ROI.

4. New Age Construction Material and Labour Problem Solutions

Construction Material

Advancement of technology has had positive impact on infrastructural projects development. Unlike earlier today the focus is on affordability, sustainability, versatility. Today material scientists, physicists, architects, and governments are coming together to join hands to develop construction material and construction techniques that minimise the impact of climate change due to infrastructure projects.

For example, instead of using wood in floating building structures where seismic activity is high is a bad idea. Focus is now on developing buildings that bend considerably without breaking. Instead, using typical light-frame buildings that resist seismic forces through system of horizontal diaphragms and vertical shear walls is a better idea. Another technique ties foundation to the building so that the whole unit moves as one. Similarly base isolation involves building a structure above its foundation using system of bearings, springs or padded cylinders. Another technique used in new age buildings is use of steel structures such as angles, plates & beams that help anchor buildings to earth offer the highest amount of ductility.

Similarly in case of buildings in flood prone or high-speed winds area, apart from using concrete, marine grade plywood, ceramic, polyester epoxy paint; clay structures are also an option. Clay absorbs moisture and reduces structural damage; and research says clay structures retain their usability even after devastating events. Historically, people who cant move to higher ground build walls, raise homes upon stilts, or rebuild. This may not be possible in urban areas that face space constrains Natural barriers like sand dunes and mangroves, flood barriers are gaining popularity.

But are new age materials the ultimate answer? The answer is “No”; while they help mitigate problems caused by natural disaster, they cant prevent disaster. Push towards sing recycled materials in construction, understanding ecology and sustainability via afforestation are part of new age construction techniques to battle climate change. A flood/earthquake prone Japan uses innovative lightweight material for building, and better disaster management systems, regulations help limit damage to life and property.

Labour Problem Solution

One of the biggest problems in effective utilization of resources and execution of infrastructure development projects in India is labour issues. More specifically problem with labour force lies in lack of workforce training; culture of inefficiency; and not working smarter. Policy makers need to recognize and support the importance of a curriculum for workforce through community colleges, apprenticeship programs, and vocational training courses if efficiency in infrastructure projection needs to be enhanced.

To overcome these issues a modular approach for construction is the best idea. Why? Because like many countries India too faces problems in embracing industrialization due to difficulty in finding skilled labour. The modular construction offers more predictable work locations and work timing, less labour-intensive work, a high degree of technology usage, and much safer working conditions. Improvements in project performance due to enhancements in labour skills can be change the way in India.

5. How to Cater for Project Cost Escalation During Project Execution

Cost escalation is different from Cost Overrun. Cost overrun happens when price of project overshoots budget whereas cost escalation is unexpected cost rise of specific part of a project due to any reason. Infrastructure projects, private and public have a long history of cost escalation. Transportation projects in particular which typically have long gestation between planning and construction is prone to it.

Project escalation has heightened considerably in the past few years. This is not only because of dramatic impact on project cost due to inflated prices, but also because cost overruns blamed on inflation not factored by project owners. There ar2 types of escalation pre award and post award. Following are some reasons of escalation.

a. Projects have grown in size, production and complexity resulting in increased owner costs, which account for a large portion of overall escalation.

b. Larger projects use of heavier equipment this has increased use of concrete and steel in projects.

c. Globalization has complicated matters with global supply chain and distribution systems also impacted. It also brings risk of entering into business with less experienced suppliers.

d. Construction site and labor demands have changed with emphasis on more headcount to support quality assurance and project controls making labour more expensive and impacting total end cost of project.

e. Health and safety are greatly improved, as overhead cost related to ensuring safety, better controls around overtime and incentive pay have also contributed to escalation.

f. Due to new and increased labour laws in high labour, labour costs are rising for many projects.

g. Environmental regulations have become more stringent around how infrastructure projects impact the environment and the economy of surrounding communities. Cost of technical, legal and field studies to get licenses and permission have impacted project escalation.

To cate to infrastructure project cost escalation project owners can do the following.

a. Accurate costings upfront makes it easier for investors, developers and lenders to understand viability of a project. Inaccurate construction cost forecast can result in huge escalation.

b. Adjusting loan conditions to reflect the risks associated with cost escalation can help projects adjust to market’s rough waves.

c. Plan procurement carefully by negotiating contracts early for trades that are expected to rapidly increase and wait for completion of trades that are expected to remain steady or decrease.

d. Dive into data to unpack trade-by-trade cost escalation to approve or reject claims and avoid protracted legal disputes.

e. Assign consultants beforehand to undertake the project and determine incentives to ensure consultants deliver documents as required

f. Contract terms must be determined by pricing the head contract and placing orders taking into account change required, time and cost impact, and whether it meets market.

g. Package work for quicker start on site by separating groundwork and other work while procurement of contractor is still underway. In a vertical build, this allows selected contractor to start work immediately on construction only. Project owners however must weigh up risk before splitting work against risk of cost escalation.

h. Procurement based on finalized design is key trade-off in going to market early. Immature design can jack up cost. Where greater cost certainty is needed, project owners must detail the packages that can be subject to fixed price or fixed rates and which package contains too much risk; based on these procurement must be done.

i. Long lead items must be identified and procured ahead of procurement of main contractor. In an escalating environment, if the order is placed earlier helps project owners avoid escalation.

j. Advanced payments for off-site materials helps contractors helps to avoid escalation. If project owners want protections in place, paying earlier to procure materials can help mitigate the risk of cost escalation.

Storage of material procured in advance is important. If there is any logistical issue, it must be sorted out before early ordering of materials. Project owners must consider practical, as well as commercial aspects before storing the material, also if needed insurance of those items should also be considered.

6. How to Make Infrastructure More Sustainable and Environment Friendly

What

While scale of the investment in infrastructure projects is staggering, it helps to build them sustainable and environment friendly for future. Sustainable infrastructure generally refers to ‘green’ or ‘smart’ buildings with specific focus on energy, water and land management; use of green areas and smart technology, as well as use of sustainable, durable building materials. Its’ a holistic viewpoint based on sustainable development goals and durability with regard to social and financial issues, public health and wellbeing generally. Sustainable infrastructure development has overlapping benefits from physical, environmental, economic and social perspectives.

From a basic perspective, sustainable infrastructure aids climate resilience, which helps build economic resilience. From a wider perspective, sustainable infrastructure development can be a source of economic growth, community wellbeing and financial returns. Sustainable infrastructure can help countries meet their national targets to cut carbon emission. Everyone from national, regional and local governments, city mayors, town planners, private investors are all focusing on sustainable infrastructure investment.

However, there are huge challenges for making investment in sustainable infrastructure across the economy. Transport needs to be smart, fast and geared towards mass transit and non-polluting. Buildings need to be taller, greener and energy efficient. Investment in planning, water and waste management, construction practices, and sustainable energy provision needs to be aligned perfectly.

The private sector needs to step up, with or without public sector assistance. A company, Arup is designing car parks with built-in increased headroom to allow building use conversion in expectation of growth in smart electric vehicles, driverless cars in future. Palava, a leading Indian real-estate developer is developing greenfield smart sustainable city outside of Mumbai, with 100% private funds.

How

1. Policy

Government needs to develop clear and supportive policies as well as regulatory frameworks to ensure sustainability and resilience both for public spending and as a signal for private investment. Implementation of legislation to make emission control and reporting mandatory. Also important is including sustainability criteria in procurement process; and improving transparency, service delivery, time and cost evaluation and management of policies.

2. Information Flow

Besides communicating benefits of sustainable infrastructure, it is important to publish long-term infrastructure plans that will help develop a pipeline of bankable projects for investors. Also important is to ensure various governing bodies work collaboratively to develop standards and collect performance data to boost project comparability, and future proof investments.

3. Mobilise Finance

?

Its high-time to divert fossil fuel subsidies towards development of sustainable infrastructure and put a price on carbon. According to OECD in 2015 US$160 to 200 billion/year was spent by OECD countries for subsidies on fossil fuel. This despite G20 commitment in 2009 to phase them out. It is estimated that in 2015 less than 15% of global carbon emissions was subject to carbon price.

It is important to develop mechanism for financial and tax incentives and financial support; as well as leverage public funding and credit enhancement to attract private investment for developing sustainable and environment friendly infrastructure. They need to provided assistance to fund upfront costs to make sustainable infrastructure projects viable for them as initially these are more expensive than conventional projects.

7. Industrial Revolution 4.0 Technologies for Infra Development

The first industrial revolution came via mechanisation, steam power and water power. This was followed by second industrial revolution, which used mass production and assembly lines thanks to electricity. The third industrial revolution came with use of electronics, IT and automation. The fourth industrial revolution is associated with use of cyber physical systems. Industry 4.0 is about automation and data exchange in technology and processes within manufacturing industry, including the use of The internet of things (IoT), Industrial internet of things (IIoT), 3D Printing, Cyber-physical systems (CPS), smart manufacturing in smart factories, cloud computing, cognitive computing, and artificial intelligence.

This automation creates manufacturing system where factory machines are augmented with wireless connectivity and sensors to monitor entire production line and make autonomous decisions. The roll out of 5G technology will further boost wireless connectivity and augment use of machines. This will ensure a faster response time, allowing real-time communication between systems. The 4.0 industrial revolution also relates to se of digital twin technologies that can be robustly tested to make cost-effective decentralised decisions. This will allow for interconnectivity between processes, information transparency and technical assistance for decentralised decisions. In short, this should allow for digital transformation. This will allow for automated and autonomous manufacturing with joined-up systems that they can cooperate with each other.

But as it stands today, infrastructure development in India is far behind in not just adopting new technologies but also in playing catch up with rest of the world. India is plagued by poor mostly un-skilled labour, lack of construction standardisation, and lack of law and contract enforcement. However, adoption of technologies that already exist in India can increase profits by 52 percent, save time by 58 percent, and reduce costs by 67 percent on project-to-project basis.

Use of technology infrastructure development has not been uniform. Its’ trifurcated in three stages based on operation, planning and design, and execution and maintenance.

1. Design and planning: This stage employs highly-skilled labour, such as conceptual designers, architects, planners, and engineers, and use of technologies like modelling, BIM, and virtual reality to augment labour productivity and enhance creativity.

2. Execution: This stage employs mixed pools of labour, both highly-skilled and semi or unskilled labour as construction manager, engineer, supervisors, construction labourers, and masons. It adopts technologies in ways to reduce the labour demand for simple tasks, but augment labour for complex tasks in a better, easier, and safer manner thereby improving build quality, save time, cut rework and material waste.

3. Maintenance: This stage employs mid-skilled labour such as general maintenance, electricians, and repair men. Adoption of technologies in this stage augments labour. Despite this machines that can defeat human effort, ability to solve problems, and exhibit social intelligence are still faraway off. Use of such technology in infrastructure can close the gap between humans and machines. Indian companies have a long way to go.

There is huge unattended potential in Indian infrastructure of use of 4.0 technology, particularly in “design and planning” phase. Here, technology adoption is easier it is used by highly-skilled labour unlike execution or maintenance phase, where technology adoption is comparatively less by low- and mid-skilled labour. Infrastructure suffers from frequent miscommunications and workflow disruption in India leading to delays and cost escalation and overruns. Challenges that prevent India from technology adoption in infrastructure development are as follows:-

1. First off, Indian policy makers must realise that India is trying to leap from an agrarian economy to advanced industrial economy by skipping industrialisation or the societal engineering that occurs through industrialisation. Meaning India lacks strong institutions, law enforcement, and skilled labour that are byproduct of industrialisation.

Second, to adopt 4.0 industry technology, India needs massive resource and labour mobilisation, shift from focus on agriculture to infrastructure and from rural to urban Adoption and introduction of reforms related to land acquisition. Develop large pool skilled labour, liberalise infrastructure norms and practices.

Thirdly, India needs to ensure employment generation, value addition, and ease of doing business in infrastructure sector besides establishing rule of law, and enforcement. ?As a spillover to other industries, it will incentivise the adoption of advanced construction technologies.

Lastly, though as an unconventional approach it may be less disruptive and less painful in terms of cost to human life, political and environmental cost; but technology adoption discourse is ridden with poor ambition and lack of vision of technology and future in India.

8. Measures to Reduce Disputes in Infrastructure Sector

Infrastructure development in India through Public-Private Partnership (PPP)can greatly boost the economy. Ever since 1990, India has recorded huge growth in mainstreaming private capital and embellishing it for advancement of infrastructure sector, particularly expressways and ports. Central and state governments have taken steps to empower private investments and limit the bottlenecks with simplified policy and regulatory frameworks. Irrespective of that there have been numerous conflicts/disputes which arise on a daily basis between the parties at various stages of construction, functioning, maintenance etc.

In India, there is a huge backlog of cases which relate to the infrastructure projects languishing before various courts. Though many private players are prepared to invest in infrastructure projects in India, but their concern in dispute remain. The process of dispute resolution takes a long time in India, which increases the project's overall cost, which the private players tend to avoid participation in the PPP projects.

The key challenges of dispute resolution in infrastructure sectors in India are as follows:-

1. Litigation is not preferred method of dispute resolution because of variables like possible postponement, requirement for specialised information. The warring parties instead prefer other methods of dispute resolution like arbitration, expert adjudication, reconciliation, mediation, and amicable settlement.

2. In India, parties are often forced to resort to litigation as last resort due to failure of other parties to acknowledge/honour settlements using alternative dispute resolution methods. In most countries, arbitration is the preferred method to resolve disputes. But in India, arbitration is less attractive. This is because retired judges and practicing lawyers who often constitute arbitration panel, lack knowledge required thereby diminishing the effectiveness of arbitration.

3. When a government entity is party to contract and involved in the dispute, it usually exhausts all possible dispute resolution methods before accepting final decision which delays the matter. Government of India is advocating privatisation, for whom on-time returns on investment is the main criteria. It is important that Government entities understand value of money and agree to faster dispute resolution. It is not possible for private parties to sustainably function if they are caught up in disputes.

4. Changes in judicial system in India like constitution of more benches, induction of more judges, swift resolution of disputes etc. by courts needs to be adopted to help parties in dispute to approach courts for faster resolution in relation to infrastructure sector.

The following steps need to be taken for faster and easier dispute resolution in Indian infrastructural projects.

a.????Focus should be more on strategic approach instead of the legal approach.

b.???In case of a dispute involving huge infrastructure projects, interim relief is crucial as obtaining final resolution may take time. Private sector players cant afford to wage a legal war for years in cvourt, so for them obtain interim relief as quickly as possible is best.

c.????The parties in dispute must work on strategy on case-by-case basis instead of following usual norms followed by industry. Approaching lower courts to get interim relief and higher courts for final settlement must be considered, as failure to obtain relief from high court in first instance may raise stake or both parties.

d.???The standard contracts issued by Government of India entities usually are ambiguous. The failure of the parties to negotiate terms of contract, usually results in disputes. If the parties start negotiating contracts on project-by-project basis, it will eradicate disputes in future.

e.????Due to the standardised form of contracts, two provisions are usually neglected by parties in India. First, the right of contractor to suspend work in case of delayed payment is not included in contract whereupon contractor can even terminate contract if such payments are not made. Second, standard contracts dont include provisions for swift interim dispute resolution. It is important that parties negotiate terms of contract and include such provisions for faster dispute resolution.

f.??????Subject matter experts as arbitrator appointment helps as they are aware technical concepts required for resolution of disputes. On the other hand lawyers and judges lack of it means they spend significant amount of time apprising courts on technical aspects without clarity.

g.????The parties must consider approaching statutory experts bodies like Appellate Tribunal or Regulatory Commissions as a feasible model for dispute resolution in PPP projects.

Conclusion

India need for infrastructure is huge. Progress in Indian infrastructure has been painstakingly slow. Mobile phone coverage expansion and infrastructure develop for it is the only exception. The market liberalisation of the 1990s, ushered in an era which was markedly different from previous era when infrastructure projects were typically financed by government, but as a solution PPP method was adopted to move forward and bring in more investment. However, lack of facilities, lack of arbitration/dispute resolution, lack of finance are some of the major cause of concern for businesses in India. Also, lack of opportunity to adopt and deploy next-generation technology in infrastructure projects is a cause of concern.