1. News
  2. Explained

The Gati Shakti Yojana - All You Need to Know

Oct 20, 2021 5:28 AM 4 min read

On August 15th 2021, the Prime Minister of India made a bold proclamation from the ramparts of Red Fort as part of his Independence Day address to the nation. 

He announced a ₹100Lcr ($1.3trn) "National Master Plan" that will cut across inter-ministerial borders and integrate all infrastructure projects in the country. The plan was officially launched on October 13th as the Gati Shakti Yojana, a digital platform created to unify the planning, programme and implementation of projects operated under the aegis of 16 ministries and departments. 

The goal is to ensure faster implementation of projects, reduce costs and provide multi-modal connectivity for seamless movement of goods and people across the country.

Dive in for a detailed explainer. 

Key Focus

The plan is expected to help fulfill some ambitious targets set by the Government for the period 2024-25. Following are some of the major goals that Gati Shakti seeks to achieve:

  • Expansion of the National Highway network to 2 lakh km.
  • Building 220 new airports, heliports and water aerodromes.
  • Expanding 4G network connectivity to ALL villages of India.
  • Boosting renewable energy generation capacity to 225 GW (from 87.7 GW presently).
  • Creating 11 industrial corridors and two defence corridors.
  • Enlarging the power transmission network to 4,54,200 circuit km.
  • Adding 17,000 km to the existing gas pipeline network.
  • Increase cargo-handling capacity at ports to 1,759 million tonnes per annum.

The Gati Shakti digital portal will have 200 layers of satellite (Geographic Information System-enabled) data on existing and planned infrastructure projects such as roads, highways, railways, toll plazas etc. It will also enable real-time tracking and coordination of various projects from one centralised location.

The objective, essentially, is to ensure that every department has "visibility" over projects of other departments, especially those that involve cross-sectoral interaction. This way, the projects can be prioritised and executed through critical planning and sharing of data. 


The Costs and the Clamour

Phrases like "holistic planning" and "breaking silos" remained the focus of the Independence Day speech which established the idea behind the Gati Shakti Yojana. Aside from the bureaucratic red-taping and departmental logjams that have been stymying the cohesive execution of projects, the idea of creating a cross-sectoral inter-departmental cooperation is the first of many goals that this plan aims to achieve.

Consider the instance of bridges. Three years following the collapse of an overhead bridge in Mumbai connecting Andheri East and West, there seems to be no sign of re-building or visible date of completion for the reconstruction in sight. Why? Because the bridge is a railways bridge which means there is a diffusion of accountability between the city's municipal body and the railways. 

And the list of glaring infrastructural delays is quite long, such as the Delhi-Mumbai Industrial Corridor, the Navi Mumbai International Airport, the Nariyar Coal Power Plant, the Polavaram Irrigation Project etc. 

And those are just the headline delays in major cities. As of June 2021, 559 out of 1,779 mega projects were stalled and for 967 projects the anticipated date of completion was unknown.

Meanwhile, the costs of these delays pile up to over ₹4.6Lcr ($61.4bn) over a period of 324 months on top of the originally-sanctioned costs. 

The National Infrastructure Pipeline has 7,000-odd projects under its supervision as outlined in the Budget 2021-22. In fact, the Development Finance Institution was set up primarily to monetise and execute these projects, an initiative that has been hailed as a step in the right direction to fill lending and financing gaps in infrastructure. 

But when it comes to the logistics gap, lack of facilitation between Government departments and administrative imbroglios have often been touted as the speed-breakers in the path of execution. From disjointed planning to non- or under-utilisation of capacity to lack of uniformity in clearance and approval mechanisms, Gati Shakti aims to address all these conflicting scenarios that have hindered India's infrastructural progress for far too long. 


The Umbrella Integrator

When it comes down to it, three elements remain central to the realisation of the Gati Shakti Yojana - reduction in logistics costs, improvement in cargo-holding capacity and drop in turnaround time.  

This is to be done through integration of the key modes of transportation - road, rail, air and waterways - and development of the associated cargo-management infrastructure. The railways (handle 32% of all cargoes), in particular, are deemed to spearhead this integration by investing ₹50,000cr ($6.6bn) over the next five years to create 500 multimodal cargo terminals. These are expected to reduce freight transport costs and streamline the high-speed rail networks. 

India's supply chain and logistics costs account for close to 14% of its GDP compared to the global average of 8%. This is a radical handicap that has the potential to make Indian products less competitive in the world market. Increasing efficiency across government facilities and optimising multi-sectoral infrastructure is the ultimate bridge that will fill in the logistical deficiencies. 

The Gati Shakti portal is currently in beta mode (under-construction). Once operational, it will set upon the task of consolidating parallel projects and facilitating macro-level coordination. The portals are designed to be dynamic, meaning that they will be coupled with API-based data integration and other analytical tools to enable real-time monitoring. 

Data integration, therefore, is expected to be a precursor to physical integration of projects in light of the increasing dependence of governance systems on data assistance.

Given India's ambitious target to become a $5trn economy, it is only fitting to shore-up the supply-side capacities whose absence has plagued crucial growth for decades. The Government's quick action to unveil the Gati Shakti portal in less than two months since its announcement perhaps underscores an intent to bring reforms in this area. 

Let's hope it leads to an opportunity to promote governance and increase departmental accountability in a country where villages, towns and cities have long been littered with monumental delays in developmental projects and erosion of tax-paid resources. 


Congratulations! You've made it to the end. Looking for more takes on Business, Finance, Markets and Investing? Subscribe to TRANSFIN. E-O-D for informative and insightful daily news updates