Why does India need to improve its infrastructure?

India: Fast growth, slow infrastructure

While some countries are still struggling to produce growth in the wake of the global recession, India has seen growth of eight percent or better over the past three to four years. However the only thing holding the country back from becoming a full-blown world power has been its infrastructure, which is currently outdated and inefficient.

While the country has had some infrastructural successes over the past decade such as a quadrilateral highway system and a cargo train line from Delhi to Mumbai, construction progress has been slow going.

This is all the more extraordinary when you consider the financial markets and backing are there for India to take advantage of, but it would appear that cutting through the paperwork in India is a lengthy process and the log jam must be cleared if the country is to move ahead in updating itself.

If it chooses to, it has no end of interest to help it. With rumours of over $500 billion to $1 trillion being possibly invested in the country's infrastructure, there is interest from construction firms all over the world about helping India modernise itself.

Slow progress

The US, for example, has said they'd be happy to provide financing and construction firms, but the only thing holding such deals back is the slow progress of land purchase, deal approvals and contract permissions in India.

Despite these setbacks though, India has risen to become on of the world's leaders in the manufacturing sector and according to a Frost & Sullivan research report titled Strategic Analysis of Indian Logistics Market, the country has given a "fresh lease of life to the logistics market."

While transport links may be slow to materialise, the industrial sector has made vast strides with operations, ranging from automotive and electronics to pharmaceuticals and cement, expanding across the country.

However despite such growth, the inadequate transport links are hampering further expansion due to poor connectivity in rural areas. As such food processing, pharmaceuticals, and consumer durables industries, which have a possibly huge consumer base in these areas, aren't reaching their full potential.

According to the report, "apart from the development of dedicated railway freight corridors, focused development of inland waterways and the strengthening of road networks through the national highway development program are expected to improve the market reach of most industries."

However even with financial backing and the necessity, it is just a matter of when India manages to proceed with these vital projects, not if.

Relevant articles:

India's daunting census | The rise of the mega-region | Asia's smart grid spending surge

Timon Singh

Timon Singh is a graduate of Liverpool University where he received a degree in Social and Economic History. He has previously worked for BBC Magazines on BBC Who Do You Think You Are? Magazine, the publication for the popular genealogy show.

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