The powerful thrust provided by Budget 2023 on infrastructure development with a strong focus on not just physical dimension, but also social and digital infrastructure which, put together could accelerate inclusive growth.


Physical infrastructure outlay in the budget

  • The Government of India’s capital expenditure as a percentage of GDP increased from 1.7 per cent in 2014 to nearly 2.9 per cent in 2022-23.
  • In Budget 2023-24, Rs 10 lakh crore (3.3 per cent of the GDP), an increase of three times from 2019, was allocated for infrastructure.
      • The Ministry of Railways received its highest-ever allocation of Rs 2.4 lakh crore, approximately nine times the allocation in 2013-14.
      • The Ministry of Road Transport and Highways saw a 36 per cent increase in its budget to about Rs 2.7 lakh crore.
  • The direct capital investment by the Centre has been further supplemented by a one-year extension of the 50-year interest-free loan to state governments.
      • It aims to encourage infrastructure investment and incentivise complementary policy actions, with a significantly increased outlay of Rs 1.3 lakh crore.



  • The targeted infrastructure investments to various Ministries will help create vital physical infrastructure, jobs and spur private investments.
  • It will improve connectivity that will accelerate the movement of passengers and freight and will also provide a cushion against global headwinds and prevailing global slowdown.
  • The extension of interest-free loans to state governments will lead to decentralised infrastructure development in urban and peri-urban areas across regions. For example, a 66 per cent increase in allocation to the PM Awas Yojana will not only provide housing but also create jobs in rural areas.
  • Investment on infrastructure development is critical as every rupee spent on capital expenditure gives 95 as a multiplier. In contrast, the money given through revenue expenditure gets less than a rupee for every rupee spent.
  • In the last eight years, one can witness the blurring of the digital divide that existed between urban and rural areas. The world has acknowledged India’s phenomenal success in building population-scale platforms at startup speed.


Digital infrastructure development in India

Digital transformation of India has been happening in two phases as follows —

  • First phase — It started in 2015 led by the JAM trinity– Jan Dhan, Aadhaar and mobile linkages, and the Digital India programme. Few successful milestones in this phase of public digital infrastructure creation are as follows —
      • Low-cost accessibility (Aadhaar), the success of citizen-centric services such as the Unified Payments Interface (UPI), large-scale adoption and reach (DigiLocker, MyGov), and the vaccine journey (CoWin) etc.
      • This had benefited India’s populace through increasing penetration of government schemes and efficient financial inclusion.
  • Second phase — It is now being led by the development, application, and large-scale expansion of cutting-edge technologies such as 5G, Internet of Things (IoT), artificial intelligence (AI), quantum computing, mechatronics, robotics, and more.
      • For example, the Digital India Bhashini portal is a public digital platform hosting 260 open-source API-based AI models for machine translation, and text-to-speech conversion in 11 Indian languages and English.
      • AI thus has enormous potential as a tool for breaking down language barriers in a country like India, with its unparalleled linguistic and cultural diversity, providing internet access in native languages.
      • It also provides the benefits of Natural Language Processing (NLP) to MSMEs and individual innovators in the hinterlands. NLP is the ability of a computer program to understand human language as it is spoken and written.
  • New announcements — The Agriculture Accelerator Fund was announced recently in the budget 2023-24.
      • It will enable the Indian agricultural ecosystem (startups, businesses, and farmers) to work collaboratively and find knowledge-based and farmer-centric solutions.
      • It will enormously benefit agricultural sector that employs nearly half the workforce of the Indian economy.


Investment in social infrastructure

  • It includes education and skilling, public health and nutrition, drinking water, sanitation and other social services.
  • Budgetary announcements — The total expenditure of the central government in social infrastructure has increased by 134 per cent from Rs 9.1 lakh crore in 2016 to 21.3 lakh crore in 2023 (BE).
      • The budget also announced mission to eliminate sickle cell anaemia by raising awareness about the near-fatal disease and screening 7 crore people in age group of 0 and 40 yrs, immensely benefiting the affected tribal areas.
      • It will also lead to a more productive and proficient workforce, reduced mortality, wasting and stunting, increased social mobility and a higher quality of life.
      • All these factors contribute to a stronger and more inclusive economy and holistic development.
  • Earlier efforts to boost social infrastructure — The Aspirational Districts Programme spearheaded by NITI Aayog also gave attention to backward districts through data-driven governance, resulting in consistent macro improvements in key socioeconomic indicators.
  • The emphasis on digital land records under the SVAMITVA Scheme of the Ministry of Panchayati Raj, a structural reform in rural land management has also led to individual economic empowerment.
  • The PM National Dialysis Programme recorded a 232 per cent expansion in the Non-Communicable Diseases clinics and 320 per cent expansion in the districts under the programme between 2014 and 2022.



The concerted thrust on creation, maintenance and expansion of physical, digital and social infrastructure has emerged as a systemic focus of India’s unique development model. This infrastructure triad will be the enabler of growth and leveller of opportunities in the dream of a “Viksit Bharat” by 2047 and people must be kept at the focal point of this infrastructure growth story.


SourceThe Indian Express


QUESTION – The strong infrastructural push under the Union Budget 2023-24 could act as a catalyst for not just higher economic growth but also development of social infrastructure that is required for human development. Discuss how?