India’s transport sector needs focus

Narendra Modi's government announced a steep hike in rail fares last week. The Indian prime minister described the price rises as the first dose of the "bitter medicine" needed to stimulate growth in the country's ailing economy: passenger fares will climb by 14.2 per cent on Wednesday, while freight rates will jump 6.5 per cent.
The increases are the largest in more than a decade and will, it is estimated, generate approximately 80 billion rupees (Dh4.8bn) in additional revenue. As with all such price rises, they will hit the poorest hardest, as rail remains the easiest and most accessible way to cross India's vast distances. Yet India's infrastructure needs investment and that money has to come from somewhere.
It is imperative that this money should be used to improve the network's creaky infrastructure, which has a woeful safety record and is burdened with ageing rolling stock.
Equally crucial is the need to upgrade the country's roads. Even though two-thirds of India's cargo is transported via lorries and trucks, the highway network is inadequate and poorly maintained. The former transport minister Kamal Nath earlier described the country's lack of decent roads as the "world's biggest infrastructure deficit".
Any investment in improving the country's transport network will have a ripple effect on the broader Indian economy. Unfortunately, India has consistently failed to recognise the powerful enabling effect a proper transport plan would have on the country's fortunes. An efficient transport network would give the poor better access to schools, hospitals and centres of commerce and would create jobs, growth and opportunity.
In addition, based on the Keynesian idea that government-backed projects that employ lots of people will stimulate the economy, the extensive building required to lay more tracks and tarmac the roads would provide widespread jobs, especially in the most remote villages.
Such infrastructure limitations are India's most serious constraint to growth. Only proper development will improve the economy. Getting India moving begins with building roads and railways they can move on.