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TRANSCRIPT
Infrastructure Development in Karnataka
Following a Sustainable Paradigm
Proposal for Official Development Assistance Grant/ Soft Loan
[A Note Prepared By the Government of Karnataka, Infrastructure Development Department: November 2010]
Sustainable Infrastructure – Concept Paper Submission to WBG
Government of Karnataka-Infrastructure Development Department 2
CONTENT
1. OBJECTIVE ........................................................................................................ 4
2. ECONOMIC & SOCIAL BACKGROUND OF KARNATAKA .............................. 5
2.1 Metrics of Demography ........................................................................................................................ 5
2.2 Economy and Employment .................................................................................................................. 7
2.3 Exports ...................................................................................................................................................... 8
2.4 Natural Resources ................................................................................................................................. 8
2.5 Need for Paradigm Shift ..................................................................................................................... 10
3. VISION 2020 AND SECTORAL TARGETS ...................................................... 13
3.1 Vision 2020 ............................................................................................................................................ 13
3.2 Core Elements of Karnataka’s Vision 2020 ............................................................................................ 14
3.3 Some Key Areas of Transformation to Achieve Vision 2020 .................................................................. 15
3.4 Targets envisaged in Vision 2020 ............................................................................................................ 15
4. TRANSFORMATION OF VISION THROUGH INFRASTRUCTURE ................. 17
4.1 Key Targets for Infrastructure Sector .................................................................................................... 17
4.2 Key focus areas of Infrastructure ........................................................................................................... 19
4.3 Environmental Sustainability............................................................................................................. 23
4.4 Social Inclusion........................................................................................................................................ 27
4.5 Fund Requirement for infra development .............................................................................................. 29
5. SUSTAINABLE INFRASTRUCTURE ACTION PLAN ...................................... 31
5.1 Issues with Infrastructure Development.......................................................................................... 31
5.2 World Bank’s Approach to Sustainability ....................................................................................... 32
5.3 The Building Blocks for Karnataka ................................................................................................... 32
5.4 Support Required by the Government of Karnataka ..................................................................... 51
5.5 Assessment of Funds ............................................................................................................................... 51
Sustainable Infrastructure – Concept Paper Submission to WBG
Government of Karnataka-Infrastructure Development Department 3
6. WAY FORWARD ............................................................................................... 54
7. CONCLUSION ................................................................................................... 55
Sustainable Infrastructure – Concept Paper Submission to WBG
Government of Karnataka-Infrastructure Development Department 4
1. Objective
The Government of Karnataka drew up a vision for the development of
infrastructure in social and economic sectors, Vision 2020. It is desired that
the infrastructure development should happen in a manner that is sustainable
environmentally while it catalyses the delivery of inclusive development. The
key areas of development identified are: Energy, Information and
Communication Technology1, Roads (rural and Highways), Railways, Ports,
Logistics, Drinking Water Supply and Sanitation2, etc. The state is endowed
with rich natural resources and but has inadequately developed infrastructure
to harness the resources. The State plans to more than double the investment
in infrastructure, annually, in the 11th plan period. The State has to partner with
private sector in a new relationship- the PPP mode in this huge endeavour.
The State has also to fine tune the configuration of knowledge, technology,
managerial, technical and financial architecture for managing infrastructure,
the creation of and sustenance of it, to get optimal levels of development. This
requires a well orchestrated effort on the part of the State’s governance.
The objective of this paper is to develop a Sustainable infrastructure
Action Plan for Karnataka; such a task has to be supported by an enabling
policy environment, capacities, expertise to conceive and develop projects of
great magnitude. In this context, adequate support in the form of
developmental assistance is sought from WBG- financial assistance and
capacity building services and technical expertise.
1 Content segment –Energy, ICT, HRD, etc. 2 Carriage segment – Roads, ports, airports, railways, logistics, water supply and sanitation, etc.
Sustainable Infrastructure – Concept Paper Submission to WBG
Government of Karnataka-Infrastructure Development Department 5
2. Economic & Social Backgroundi of Karnataka
Karnataka, earlier known as Mysore, came into being on November 1st, 1956, with
the merger of five different provinces where Kannada was the main language. It
currently has 29 revenue districts, 176 blocks and 27,481 =s3, and covers an area of
about 191791 sq.km.
2.1 Metrics of Demography
Its share of 5.31% of the nation’s total population in 1991 has reduced to around 5%
in 2008. The State’s decadal growth rate of population has also been declining,
though it is higher than the neighboring States. Population density at 275 per sq km
is relatively low compared to other States. The share of the State’s rural population is
estimated to have declined from 69% in 1991 to about 64% in 2008.
Figure 1: Karnataka Population Pyramid 2026
3 However the Habitations are 57417 (2001 Census)
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Government of Karnataka-Infrastructure Development Department 6
Population Issues
Ever Increasing Working Population: In 2005, 63% of Karnataka’s total population
was in the working age group of 15-59 years, which is higher than the all-India
average of 59%. The working population (15-59 age group) is set to increase by
0.77 crore (3.58 crore to 4.35 crore) between 2006 and 2026, which means an
average of 4 lakh new entrants to the workforce each year up to 2026.
“Medium Human Development4”(UN Classification): As per the National Human
Development Report 2001, Karnataka ranks seventh among major Indian 2001
States on human development index (HDI). The State’s HDI has improved from
0.54 in 1991 to 0.65 in 2001. At an international level, this means that Karnataka’s
position among nations, at around 120, is marginally better than India at 127.
Regional and social disparities in human development: Within the State, however,
the variance between districts is wide – Raichur with a HDI of 0.547 being the
lowest, and Bangalore Urban with a HDI of 0.753 being the highest. Disparities
can also be observed across communities with HDI (in 2004) for SCs (0.575) and
STs (0.539) much lower than the State average.
UN’s Millennium Development Goals (MDGs)- "to eradicate extreme poverty
and hunger": In 2004-05, the poverty headcount ratio (HCR) in rural Karnataka
was 20.8%, and in urban Karnataka, it was much higher at 32.6%. The combined
HCR for Karnataka stood at 25%. It is to be noted that HCR in urban Karnataka is
much higher than all its neighboring States, as well as the country average, which
is a cause for concern, especially in the context of the rapid urbanisation the State
is going through.
Dependence on Unorganised Sector for Livelihood: With the organised sector
having a share of 8% of total employment, it is the unorganised sector that is key
to providing livelihood in the State.
4 the process of enhancing individual and collective quality of life in a manner that satisfies basic
needs (as a minimum), is environmentally, socially and economically sustainable and is empowering in
the sense that the people concerned have a substantial degree of control over the process through
access to the means of social power."
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Government of Karnataka-Infrastructure Development Department 7
Mitigating the above issues requires creation of significant employment opportunities,
appropriate education and skill development of the workforce as an essential
requirement to improve ‘employability’. Providing appropriate and adequate
employment opportunities and accelerating the pace of creation of jobs are essential
for Karnataka’s growth.
2.2 Economy and Employment
The GSDP for Karnataka in 2006-07 was Rs. 1, 94,008 crore (at current prices) as
against Rs. 37, 18,000 crore for India, which makes it 5.2% of the country’s GDP.
Karnataka has had moderate growth rates in its State income. In the period 1999-
2006, Karnataka had a GSDP growth rate of 5.9% making it fourth amongst
compared States and lesser than India’s GDP growth of 6.5%. The State’s real
income growth, which struggled to cross beyond 4% till the early 1990s, is now
nearly 6%. Karnataka has lower per capita GSDP than most comparable States - it is
only marginally higher than the India average.
Table 1: Sector Share of input and their contribution to GDP
Key Issues
Dependence on Tertiary Sector serving a limited Population: The share of primary
sector, which contributed to about 60% of the GSDP in 1960- 61, is only about
18.9% in 2006-07. In the same period, the share of secondary sector increased
from 15.2% to 26%. The share of the tertiary sector has more than doubled from
24.8% to 55.1%.
Sectoral misalignment between economy and employment: With employment
share of 60.8%, Agriculture contributes only 18.5% to GSDP, underlining a large
population which needs to be enabled to take advantage of the opportunities.
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Government of Karnataka-Infrastructure Development Department 8
Lowest growth rate for Agriculture: It exhibits low growth of 0.8% but is absorbing
a large amount of labour as it still employs about 61% of the workers. This implies
a decline in output per worker and falling labour productivity.
Other Key issues being:
Marginalisation/ Feminisation of labour
Gender disparities in wages and employment
Existence of Child labour
2.3 Exports
During the 10th plan period, the total exports from Karnataka have grown from Rs.
20,144 crore (2001-02) to Rs. 1, 05,850 crore (2006-07) at a CAGR of 39%.
Electronics and computer software exports have grown at a CAGR of 37% with the
total exports reaching Rs 56,478 crore in 2006-07. This sector constituted 53% of the
total exports from the State. 36% of the total Indian exports in this sector were from
Karnataka, establishing the State’s leadership. However, the State’s export
performance is not limited to Information Technology alone. During the 10th Plan,
petroleum and petro-product exports of Rs 36,087 crore (CAGR =113%) and gems
and jewellery exports of Rs 21,095 crore (CAGR=94%) from the State saw very high
growth rates. The other major exports from the State during the 10th Plan were iron
ore and minerals (Rs 21,299 crore; CAGR=60%), readymade garments (Rs. 24,291
crore; CAGR=19%) and engineering goods (Rs. 15,083 crore; CAGR=39%).
2.4 Natural Resources
Karnataka is blessed with rich and diverse natural resources. 60% of the Western
Ghats run through the State, showcasing immense natural beauty. Around 30.7 lakh
hectare (16.1% of the State’s geographical area) is covered by forest. The State is
home to world-famous sandalwood and rosewood trees, hosts 5 National Parks and
21 Sanctuaries and ranks 4th among all States in respect of area under tree cover.
However, the Western Ghats have now been classified among the world’s critical
bio-diversity hot-spots – a bio-geographic region with a significant reservoir of
biodiversity. The State has seven river systems; Karnataka has 33000 tanks with a
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Government of Karnataka-Infrastructure Development Department 9
total command area of 4 lakh hectare. The State also has about 1100 other minor
surface irrigation structures that include barrages, bridge cum barrages, anicuts and
pickups, lift irrigation schemes etc.
The major minerals available in the State are iron ore, gold, manganese, limestone,
dolomite silver and shale. There are around 235 mines in the State. During the 10th
Plan period Karnataka exported iron ore and minerals worth Rs 21,299 crore,
growing at a CAGR of more than 60%.
Key Issues
Nearly 70% of the states geographical area falls under ‘arid’ and ‘semi arid'
climatic zones, where rainfall is scanty and average temperature is high
The west flowing rivers account for 58% of this average annual availability but
almost 80% of the water from these rivers is not utilisable for irrigation due to
topographical and environmental constraints.
Due to overexploitation, the groundwater balance available for future
development has fallen from 9.7 lakh HAM in 1992 to 6.5 lakh HAM in 2004.
The value addition to minerals found in the state is low.
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Government of Karnataka-Infrastructure Development Department 10
2.5 Need for Paradigm Shift
The road to sustainable infrastructure is challenged:
Figure 2: Conceiving Sustainable Infrastructure
A look at Karnataka’s development trajectory in the past few decades shows that its
economy has grown at around 6%. There has been a sectoral shift in terms of its
composition, with the tertiary sector overtaking the primary sector as the major
contributor to economy around the year 1990 (see figure below).
Resources demand, low level of projectisation and management skills, demand for increased doles Slow low quality delivery
process
Inequitable Access, Poor information
In adequate supply , deteriorating assets
Sustainable Infrastructure
Citizen
Social and Environmental Infrastructure: Edu, Water Supply, Health, Sanitation
State
Economic Infrastructure: Transportation, Energy, Ports, Airports, Railways etc
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Government of Karnataka-Infrastructure Development Department 11
Figure 3: Movement in sectoral contribution to NSDP from 19070 to 2008
The primary focus of development policy in Karnataka has to be on balanced growth
ensuring better sectoral output employment ratio. This requires creation of
employment opportunities in the non-farm sector – both in industry and services that
are more productive and offer higher returns to labour. This further requires that an
enabling environment in terms of infrastructure availability, policy and procedures is
made available for the growing sectors in industry and services so that they have
incentives in enhancing their employment base.
The table below from Vision 2020ii provides movement of two indicators under
different plan periods with the interventions planned in the document for balanced
growth: (a) GSDP (b) ratio of Output per Worker in Service to Agriculture:
Table 2: Movement of GSDP and Ratio output per worker under different sector interventions
Indicator GSDP growth rate Ratio of Output per Worker (Service to
Agriculture)
Business As Usual5
2007-12 (11th Plan)
8.1%
8.8
2012-17 (12th Plan) 8.5% 12.0
2017-22 (13th Plan) 8.9% 16.2
5 Business as usual: trends of the past 12 years of sectoral growth rates and sectoral shares of GSDP and employment to continue.
Sustainable Infrastructure – Concept Paper Submission to WBG
Government of Karnataka-Infrastructure Development Department 12
Employment Alignment- I6
2007-12 (11th Plan)
8.1%
7.9
2012-17 (12th Plan) 8.9% 8.4
2017-22 (13th Plan) 9.1% 8.2
Employment Alignment- II7
2007-12 (11th Plan)
8.1%
7.1
2012-17 (12th Plan) 8.9% 5.7
2017-22 (13th Plan) 9.1% 4.9
There is a need for a paradigm shift to overcome the issues identified on population,
economy and Income. Karnataka needs to exploit its resources and enable its
population through infrastructure in a sustainable manner to achieve the
developmental goals moving towards Employment Alignment-II scenario as depicted
above.
6 Employment alignment – I: disparities do not rise; ratio of output per worker in services and agriculture remains stable; net annual movement of workers out of agriculture – 2,00,000; net annual movement of workers into industry and services – 1,40,000 and 4,60,000 respectively 7 Employment alignment – II: disparities decline, ratio of output per worker in services and agriculture decline; net annual movement of workers out of agriculture – 3,20,000; net annual movement of workers into industry and services – 2,20,000 and 5,00,000 respectively
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Government of Karnataka-Infrastructure Development Department 13
3. Vision 2020 and Sectoral Targets
3.1 Vision 2020
A State vision assumes importance in understanding the shared goals of its people,
bringing about an alignment in their combined efforts and realising optimal synergies
in their action. The vision should enable the State to ensure farmers, workers,
entrepreneurs, scientists and others to find their due space by following an inclusive
growth process leading to a prosperous and equitable Karnataka.
The key fundamentals for development are therefore:
Equitable & Inclusive: Geographically and demographically; and
Sustainable: development that "meets the needs of the present without
compromising the ability of future generations to meet their own needs."
Figure 4: Themes of Sustainable Development
Sustainable Development will remain one of the greatest challenges of the 21st
Century, where we have to address the needs of the present without compromising
the ability of the future generation to meet their own needs. A Sustainable
Environmental
Values
Economic
Values
Social Values
Bearability
Values
Viability Values
Sustainable Values
Equitability Values
Sustainable Infrastructure – Concept Paper Submission to WBG
Government of Karnataka-Infrastructure Development Department 14
Engineering Infrastructure(SEI) Model8 advocates infra development following the
‘triple bottom line’ concept during the planning, design, development, implementation
and management phases. The three themes (Economical, Environmental and social)
are highly interrelated and are of equal importance, which are gaining world wide
acceptance within the corporate community as a framework for corporate reporting
practices in sustainable development. The set of values underlying these themes are
Environmental Values: natural resources utilization, environmental management
drive, pollution prevention and controls- (air, land waste and water resources)
Social Values: standards of living, equal opportunity, community, governance,
institutions, consultations, inclusion and empowerment of citizenry
Economic Values: cost savings, profits research and development, economic
growth, efficiency and stability
The intersection of these spheres yield new set of SEI model values
Bearability Values(socio-environmental): cost savings, profits research and
development, economic growth, efficiency and stability
Equitability Values(social-economic): equitability values of business ethics, fair
trades and workers right
Viability (environmental-economics): energy efficiency, subsidies and incentives
for the use of natural resources
The infrastructure development to attain sustainability should promote a rigorous
interaction for a balance amongst the three themes of sustainability.
3.2 Core Elementsiii of Karnataka’s Vision 2020
Based on a perspective view of the social, economic and historical foundations of the
State, the following are identified, inter alia, as core elements for achieving the vision
of a peaceful and prosperous Karnataka:
Eliminate poverty and deprivation at all levels and achieve Millennium
Development Goals (MDGs)* by 2015
Enhance human capabilities to promote equitable growth covering all sections of
people and regions of the State
8 Reference: A Sustainable Engineering Infrastructure Model for the 21st Century by Bassey Okon, Sunday Ekpo and Dr Taha Elhag
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Government of Karnataka-Infrastructure Development Department 15
Institutionalize good governance across the State through enhanced
transparency, accountability and participation.
3.3 Some Key Areasiv of Transformation to Achieve Vision 2020
Increase rural incomes through greater viability of agriculture and allied
activities
Improve access and availability of quality healthcare for all
Achieve a sustainable and orderly process of industrialization and urbanization
Enhance opportunities and empower women across economic, social and
political spheres
Improve energy availability and develop infrastructure to boost productive
potential of economy
Ensure sustainability of the state’s environment and natural resources
Build and sustain Bangalore’s global leadership in science, technology and
knowledge based industries
3.4 Targetsv envisaged in Vision 2020
The table below brings out the targets in vision 2020 in social sectors:
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Government of Karnataka-Infrastructure Development Department 16
Development Vision Units
Level
Present 2020
A. Economic Sector
1 Agriculture
Irrigated Area % on potential 49 >90
Lakhs Hectares 30 61
Watershed Area Lakhs Hectares 44.75 80
Agricultural Labour % of total 61 35
Agricultural Growth % 0.8 4
2Public Transport On total trips % 45 73
Public Transport with renewable energy % 0 100
3Forest Area covered % 16.7 33
4Industry Growth % 7.9 9
Industrial Employment % 15 22
5Road
Average Km / sq.Km 1.07 1.50
NH + SH Km 21486 40000
≥ 2 lanes Km 6696 66456
All weather Roads % 60 100
6Electricity
Infrastructure Capacity MW 9559 18500
T&D Loss % 28 < 15
Agriculture IP Set
metering % 29 > 90
Table 3(A&B): State growth parameters- Vision 2020 target levels
Development Vision
Units
Level
Present 2020
7Railways Rail Density Km /1000 sq.Km 16.9 28
8Output per workers (Agri : Services) Ratio 8.8 4.9
9Cold Storage Capacity 1000 MT 250 4800
B. Social
Literacy Rate Literacy Rate % 67 100
Access to Skill Training % low 100
Health
IMR (Infant Mortality
Ratio) No. 48 10
MMR (Maternal
Mortality Ratio) No. 228 25
Population Spread Urban Crores 2.08 2.8
C. Others
Rural Poverty % 20.8< 5
Urban Poverty % 32.8 0
Access to water LPCD 27 100
Slum population % 7.8 0
D. Pollution Levels SPM > 160 40
4.
4.
4.
4.
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Government of Karnataka-Infrastructure Development Department 17
4. Transformation of Vision through Infrastructure
Sustainability and acceleration of Karnataka’s economic growth critically hinges
on the availability of adequate and good quality infrastructure facilities. Though the
State’s physical infrastructure is fairly extensive, it has failed to keep pace with
rapidly rising demand resulting in frequent and acute demand-supply gaps. This calls
for a larger, coordinated transformational approach to infrastructure planning and
implementation. While the Government’s investment for infrastructure development is
inescapable, the PPP route also needs to be encouraged. Along with supplementing
scarce public resources, it creates a competitive environment and thus improves
efficiencies.
4.1 Key Targets for Infrastructure Sector
The quality and adequacy of infrastructure is the major determinant for
improving quality of life and attracting investments. A few infrastructure targetsvi are
identified below for reference.
Table 4: Infra sector key targets
* to be read as- Road Density: 1.07 km per Sq Km (current level), 1.50 km per Sq Km (Goal for 2020)
Road net work:
Though the State has a good road density of 1.05 km per sq km, much of this is
single lane and/ or un-surfaced- only 10% of Roads are 2 lanes or above, 2% of
Roads in the form of National Highways carry 40% of traffic, 50 % of rural roads
are un-surfaced.. The State requires a core road network (NH + SH) of around
40,000 km, but has around 24,000 km currently. A 250% increase in vehicle
*
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Government of Karnataka-Infrastructure Development Department 18
population between 1997-2007, doubling of freight vehicle density and inadequate
funds for road maintenance, has led to asset deterioration.
Railways/ Ports/ Energy:
The State continues to have a low rail density of 16km per 1000sqkm; almost half
of Gujarat, Tamil Nadu or Kerala and faces a shortfall of capacity to handle
projected increases in port, cargo and air traffic, which are also hindered by poor
connecting infrastructure.
The capacity of ports themselves is inadequate pushing exporters to move their
goods to neighbouring states’ ports thus hurting the competitiveness of industry.
The per capita consumption of energy is low at about 750 units.
Water / Irrigation
Though the State has a potential to bring under command of irrigation about 35
lakh hectares of land; due to water related disputes it could harness only 22 lakh
hectares. The number of Minor Irrigation tanks have remained static at about
33000 over years and in fact their capacity to store water has decreased over
years with silting etc. A rough estimate9 indicate that a 200- day employment
round the year for agriculture labour and agriculturists pose a deficit of 100 crore
mandays of labour, annually, to be created through other measures- NREGA ,
transfer of labour to non- agriculture activities, through enhancing agricultural
productivity, etc. The Vision 2020 sets the following targets in agriculture growth :
9 Based on an estimation done by Mr LV Nagarajan, Principal Secretary ( Water resources)
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Government of Karnataka-Infrastructure Development Department 19
Table 5: Agriculture growth vision 2020 target levels
4.2 Key focus areas of Infrastructure
The following key themes are identified for infrastructure Development:
Transportation
Road Network: State plans to develop a core road network as stated above and
provide impetus to economic activity by connecting locations of agricultural,
industrial and tourist importance. This will be in line with existing and potential
regional industrial clusters, urban corridors and district development plans. High
density stretches are identified for the creation of dedicated corridors, constructed
with private participation.
Rail Network: The State is endeavoring to put up at least 4800km of Railway
corridors with the help of Railways.
Logistics Network: At the same time, the State will develop a logistics architecture
consisting of Transportation, Storage, and Distribution to meet the needs of just–
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Government of Karnataka-Infrastructure Development Department 20
in-time requirements. This service will have significant employment benefits.
Infrastructure creation for border areas to leverage from growth centres in
neighbouring States will also be encouraged. Public-private partnerships (PPP)
with a minimum specified period for revenue sharing/ annuity would provide an
important mechanism in this endeavour.
Ports: The state has planned to develop ports to enhance both inbound and
outbound trade.
Energy:
The State has planned to put up another 10741 MW of power units. This would
help in improving the power consumption to 1200 units per capita.
The state has planned to facilitate construction of gas pipelines to enhance
energy security and make clean energy available to all classes of population.
Achieving Orderly Industrialization & Urbanization
Karnataka is a rapidly urbanising State having 36% of its population in urban
areas. Urbanisation offers the ability for better provision of basic services, and acts
as a centre for growth of industry and services. By facilitating employment in higher
productivity sectors, it raises quality of life and disposable incomes. Therefore, if
properly managed, faster industrialisation and urbanisation is desirable. In
Karnataka, however, both these processes are largely concentrated around
Bangalore. This has led to proliferation of slums, inadequate infrastructure, and glut
of unskilled labour, environmental degradation, and income disparity. The State’s
policies therefore need to be driven by three broad concerns – improve linkages
between the city and its hinterland, make the towns a productive setting for growth
and develop a distinctive approach to address issues of urban poverty. To achieve a
transformational change, the State has to renew efforts on the following objectives:
Industrial Zones:
To harness the local natural resources and also to optimize its value addition,
following sector specific industrial zones/ corridors will be developed as identified in
Industrial Policy ‘09vii:
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Steel : covering Bellary, Koppal, Bagalkot, Haveri, Gadag & Raichur Districts
Cement: covering Gulbarga, Bagalkot, Chitradurga, Belgaum and other Districts.
Food Processing: covering Bangalore Rural, Kolar, Belgaum, Gadag, Koppal,
Shimoga, Bagalkot, Bijapur, Davangere, Mandya and Dharwad Districts.
IT/ BT : covering Mysore, Mangalore, Hubli-Dharwad, Belgaum, Shimoga,
Gulbarga, Kolar and Mandya Districts
Automobile: covering Ramanagara, Shimoga Dharwad and Kolar Districts.
Readymade garments: covering Bangalore Rural, Tumkur, Kolar, Mandya,
Belgaum, Bidar, Dharwad and other Districts.
Sugar and co-gen, power: covering Bidar, Belgaum, Bagalkot, Shimoga and
Mandya Districts.
Pharmaceutical/Bio-Technology: covering Bangalore, Mysore and Hassan
Districts.
Power Generation: covering Raichur, Bellary, and Bijapur & Chitradurga Districts.
Media & Entertainment : Bangalore (R) and Ramanagara.
The state’s aggressive industrialization planned through the recent Global
Investors meet where 403 MOUs in various Industrial sectors as below have been
signed. Given below is the breakup of sector wise investments and its footprints10(
the latter not to drawn to scale:
Table 6: sector wise Industrial Investments in Karnataka through Global Investor Meet 2010
Sl.No. Sector No. of projects Investment
(in Crores)
1 Aerospace 6 4929.00
2 Automobile 6 802.32
3 Cement 15 8619.20
4 Chemical 12 5578.19
5 Coke 1 212.00
6 Distillaries 5 466.12
7 Engineering 37 1302.14
8 Energy 34 50051.85
9 Food Based 31 1921.16
10 Health 11 1332.42
10 This is presented to indicate that at present the real addition to ecological footprint is not known. This would be clear only when the investments are brought up for environmental clearance.
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Government of Karnataka-Infrastructure Development Department 22
11 Infrastructure 31 5356.92
12 IT/BT 59 11361.06
13 Iron & Steel 52 254759.08
14 Others 25 2645.24
15 Petrochemicals 5 28988.36
16 Pharmaceutical 6 170.35
17 Plastic 5 303.45
18 Sugar 10 2189.25
19 Telecom 3 117.86
20 Texttile 6 1547.97
21 Tourism 29 2829.06
TOTAL 389 385483.00
Figure 5: Industrial Growth (Present and future) vs. Ecological Footprint
Industrial Growth- Present & Future
0
10
20
30
40
50
60
70
80
90
100
0 10 20 30 40 50 60 70 80 90 100
x1
x2
B
IJ
CD
EF
G H
K
L
N
M
P
O
V
U
X
W
TS
RQ
AH
I
G
H
L
O
W
LOW HIGH
Industrial Growth
Ec
olo
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al F
oo
t Prin
t
AB Aerospace Sector MN Iron / Steel
CD Software / Hardware OP Sugar
EF Electronics / Telecommunication QR Textiles
Industrial
Zones
GH Engineering ST Drugs & Chemicals
IJ Automobile UV Distillaries / Breweries
KL Cement WX Petroleum Products
Ecological footprint to increase with the new MOUs
Area-Based Approach with Urban Corridors as Hubs of Economic Activity.
The State will target investment in select urban corridors to make them centres
of industrial activity and develop select Tier II / III cities as future growth centres. As
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Government of Karnataka-Infrastructure Development Department 23
part of Suvarna Karnataka Development Corridorviii (SKDC) Programme, following
major industrial corridors with 8 lane roads will be developed: Bidar-Bangalore via
Chitradurga, Tumkur-Honnavar via Shimoga, Chitradurga-Mangalore via Shimoga-
Udupi and Bangalore-Belgaum via Davanagere -Hubli. Additional corridors will also
be developed to cover Bidar, Bijapur and other potential locations.
4.3 Environmental Sustainability
Eco-Footprint of Infrastructure Sectors
The Eco-foot print of various infrastructure sectors are very varied. While the
sectors like Agricultural Hub, irrigation, water Supply and Urban Transport have
higher eco-footprint, others like renewable energy- solar, wind, mini-hydel and
transportation like port and railways as shown in the figure below.
Figure 6: Figure: Ecological footprint Vs Infrastructure Growth
InfrastructureLow High
Low
High
Ecolo
gic
al F
ootp
rint
Solar
Wind
Mini Hydel
Ports
Railways
Road
Dry Agri
Wet Agri
Urban Transport
Energy-
Thermal
Water Supply
Agri-Hubs
Irrigation
Sustainable Infrastructure – Concept Paper Submission to WBG
Government of Karnataka-Infrastructure Development Department 24
As these infrastructure grow the ecological footprint is only going to increase
at differing rates. It may be pertinent to encourage those technology like renewable
energy, railways, ports which have relatively lesser impact on the atmosphere.
Eco-efficiency in Infra development
Environmental Inputs (influence) in the form of Energy, Water, Materials, Land
is used by any product or service to produce value and waste (GHG Emission,
Emission- Sox, Nox, Emission to Water, Waste/ Hazardous Substance, Loss of Bio-
diversity). The eco efficiency represents, ratio of the value delivered from a product or
service to the input amount of inputs.
Figure 7: Eco-efficiency construct
Energy,
Water, Materials,
Land
GHG Emission
Emission- Sox, NoxEmission to Water
Waste/ Hazardous SubstanceLoss of Bio-diversity
Product/
Services
Value Delivered
Waste Impacts
Resources
Product/ Service Delivered
• Eco-efficiency = -------------------------------------------
Environmental Influence
To improve the eco-efficiency, we need to
Decrease input resources
`Reduce the wastages
Enhance recycling and Maximize Renewables
Reduce Dispersion of toxic Substances
Eco-efficiency adoption in environmental sustainability program will require the following
Higher degree of Planning and Design before any infrastructure development
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Government of Karnataka-Infrastructure Development Department 25
Lower cost of Infrastructure Financing to offset the relative higher cost of eco-
friendly technology
Proper Operation and maintenance for higher efficiency of the project at all times
Holistic view while adopting any sustainable infrastructure
Consider Life-cycle cost of the project.
The State will take the following steps for Environmental Sustainability
Forest Cover
As suggested by National Mission for Green India, Karnataka will proactively take
action on degraded land through direct action by communities organized through
JFMCs (Joint Forest Management Committees) to increase forest cover from
16.7% to 30% by 2020.
The State will also set up a task force for conservation of the Western Ghats, set
up sites for seabird conservation and for domesticated animal biodiversity for
protection of birds and animals.
As means of reducing GHG emissions, Karnataka will undertake
projects for ‘biomass energy in rural areas, development of high-rate
biomethanation processes’
‘Use of alternate energy and biomass gasification’, setting up a large
commercial bio-fuel plant and promote usage of wastelands for cultivation of
biofuels while addressing food security issues.
Karnataka Renewable Energy Development Limited (KREDL) will promote
energy efficient projects to avail the benefits of Clean Development
Mechanism (CDM).
Water/ Irrigation
The State would have to enhance its irrigation capabilities, but the same is
subject to decisions of Water Tribunals and other Statutory authorities. The State
also has to take up integrated drought proofing measures covering all the lands,
involving water shed management and Irrigation. The treatment of land through
Sustainable Infrastructure – Concept Paper Submission to WBG
Government of Karnataka-Infrastructure Development Department 26
watershed approach requires about rupees 4000 cr. The State will try to improve
water quality through:
Following the guidelines on groundwater management (Planning Commission)
and ownership; the pending State bill will be revised to incorporate latest
developments.
All ULBs and PRIs to enforce mandatory rain water harvesting measures for
households.
The Karnataka Water Resources Regulation Authority will facilitate improved
water resources management, conservation and regulation to ensure an optimum
use of available water resources across different use categories.
Sustainable Mining
By adopting relevant recommendations of the National Mineral Policy, 2008 to
ensure sustainable development of mineral resources in harmony with
environment.
By ensuring proper resettlement and rehabilitation of persons being displaced.
By converting old unused mining sites into forests and other appropriate forms of
land use.
By averting exports of natural ore and encourage process industries to ensure
that the natural resource wealth of the State gets multiplied through carrying out
value addition activities within the State.
Air quality improvement
By ensuring that Bangalore meets the WHO air quality guidelines.
By promoting fuel efficiency by incentivising the use of hybrid/ electric vehicles
and LPG/CNG for road-based public transport.
By improving access, efficiency, effectiveness and comfort of public transport to
reduce growth of private vehicles.
By devising procedures for blending fuels with specified percentage of bio-fuels
as advised by the Bio-fuel Task Force.
By improving intra-city bus services both on a point-to-point basis as well as to
provide last mile connectivity between metro stations and neighbourhoods/offices.
Sustainable Infrastructure – Concept Paper Submission to WBG
Government of Karnataka-Infrastructure Development Department 27
By full fleet conversion of its buses to CNG. The State will also explore options of
fuel cell bus (FCBs) for reducing air pollution and global GHG emissions.
A few Environmental targetsix identified in Vision 2020 are:
Table 7: Environment targets in vision 2020
4.4 Social Inclusion
To address socially inclusive growth we need to address several factors
Poverty eradication: The first goal specified in the UN’s Millennium Development
Goals (MDGs) is ‘to eradicate extreme poverty and hunger’. In 2004-05, the
poverty headcount ratio (HCR) in rural Karnataka was 20.8%, and in urban
Karnataka, it was much higher at 32.6%. The combined HCR for Karnataka stood
at 25%iv. It is to be noted that HCR in urban Karnataka is much higher than all its
neighbouring States, as well as the country average, which is a cause for
concern, especially in the context of the rapid urbanisation the State is going
through.
Monthly Per capita Consumer Expenditure (MPCE): Over 30% of the rural
population, i.e., more than 1 crore persons in rural Karnataka live on less than
Rs.12 per person per day. Around 30% of urban population, i.e. around 60 lakh
persons live on less than Rs 19 per person per day.
Poverty Reduction: The 10th Plan target for the State was to reduce the HCR
from around 27% to 7.85% and number of poor to 45 lakhs by 2007v. However, in
2004-05, it still stood at 25%, with the number of poor being 138.89 lakhs
Urban-Rural disparity: The average MPCE of urban Karnataka is more than
double that of rural Karnataka. A large proportion of the rural workforce is
Sustainable Infrastructure – Concept Paper Submission to WBG
Government of Karnataka-Infrastructure Development Department 28
engaged as casual labour and earns minimal wages and is largely dependent on
agriculture for employment and income. There also exist wide disparities in
wages, education and health indicators and access to basic services.
The disparity between north and south Karnataka persists In terms of the Human
Development Index (HDI) also. 7 out of 8 districts having HDI lower than India’s
HDI level of 0.621 are in North Karnataka, whereas all 7 districts having HDI
greater than the State average of 0.65 are in South or Coastal Karnataka. In
terms of basic infrastructure, overall performance of the State is poor – only 35%
households had access to all the three basic services, i.e., safe drinking water,
electricity and toilets as per Census 2001.
Gender Development: The Gender Development Index (GDI) depicts the
inequalities between men and women to attain a long and healthy life, appropriate
education and a decent standard of living. The GDI of Karnataka at 0.637 (2001)
is higher than the all-India value of 0.609, and has improved from 0.525 in 1991.
The State ranks sixth among the major States on GDI. However, gender
disparities in the form of adverse sex ratio, wage differentials and various health
and education dimensions are still prevalent in the State.
Social disparity: Deprived groups (SC/STs, OBCs and Muslims) have exhibited
lower social and economic indicators including acute lower levels of consumption,
lower literacy rate and health indicators.
To improve social inclusiveness we need to improve access and affordability of
basic and social infrastructure to the deprived groups.
Physical Infrastructure like irrigation, road network and rail network etc
Social infrastructure like Health, Education (mainly skill-based training)
Sustainable Infrastructure – Concept Paper Submission to WBG
Government of Karnataka-Infrastructure Development Department 29
Figure 8: Ecological footprint Vs Infrastructure Growth
Social Infra Devp.Low High
Low
High
Access
Vocational Edu
Primary Edu
Primary Hosp.
Sewerage
Water Supply
Solid Waste
Empirically it is understood that as the social infrastructure development happens
the socially backward population is likely to have higher access thus leading to higher
human development Index. Some of these social infrastructure Vocational Education
will provide higher access to the individuals than others, which may be prioritized to
be taken up at the earliest, though all of them may be required.
Human Development Index to measure Social Inclusion
Human Development Index comprise of poverty, education and health among
others as its input parameters, and can be a measure of Social inclusion. By
measuring the HDI the social inclusion can be tracked and through various
interventions can be improved.
4.5 Fund Requirement for infra development
The cross-country study of investment levels in infrastructure in the fast-growing
Asian countries reveals the need to increase infrastructure investment to 9% of GDP
over the next 15 years to sustain a growth rate of around 9%. This would entail a
huge thrust on infrastructure investment in the State. Gross capital formation as a
Sustainable Infrastructure – Concept Paper Submission to WBG
Government of Karnataka-Infrastructure Development Department 30
percentage of GSDP would have to rise to 7.5% during the 11th Plan period and to
10% and 11% during the subsequent Plan periods, translating to total investment in
infrastructure of Rs. 92,462 crore, Rs. 1, 86,275 crore and Rs. 3, 15,657 crore at
2006-07 prices (these figures include investments in Irrigation) during the 11th, 12th
and 13th Plan periods respectively.
Sustainable Infrastructure – Concept Paper Submission to WBG
Government of Karnataka-Infrastructure Development Department 31
5. Sustainable Infrastructure Action Plan The State plans to meet the lags in access to core infrastructure- drinking water,
transport, energy, logistics, ICT, etc by partnering with the private sector in a big
way as the Central and state budget- funded investments are still leaving a gap of
1/ 3rd or more of the demand for investments. While designing the projects the
State would keep in focus the viability of the projects from the financial and
economic angle and ensure that the project is environmentally sustainable and
support social inclusion.
5.1 Issues with Infrastructure Development
Infrastructure services are provided by various Government departments, agencies,
corporate entities, and statutory authorities. While the Government is reasonably
good at creating (constructing) infrastructure, the model is deficient due to:
Lack of life-cycle costing and maintenance planning:
A ‘lowest tender’ approach to the exercise, which results in low capital outflow,
but also consequent degradation in performance and poor ‘value-for-money’ to
users.
Low level of projectisation- in scheduling tasks and subtasks, monitoring costs
and milestones, etc,
Integrated planning requirements:
Even where city ‘master plans’ exist, they are more in the nature of land-use
plans,
Infrastructure facilities are not well meshed together.
Capacity deficiency in managing contracts- skills to manage large investments in
a projectised approach; capacity to absorb larger investments in a shorter period
of time.
Attitudes and perceptions of entire governance architecture to PPP- Political
executive, bureaucracy, Courts, Legislature, CAG, fourth estate, etc.
Lack of sustainability and environment consciousness
Projects are evaluated on financial merits, rather than a composite index than
considers environmental, social, and sustainability aspects.
Sustainable Infrastructure – Concept Paper Submission to WBG
Government of Karnataka-Infrastructure Development Department 32
Insufficient focus on equitable development, poverty alleviation and employment
creation:
Substantial infrastructure is targeted at the more visible/ vocal sections of
society.
Social disparity in accessing infrastructure by the lower sections of the society
Regional disparities in infrastructure development
Climate change impact mitigation
5.2 World Bank’s Approach to Sustainability
These deficiencies are by no means endemic to Karnataka alone, but cover most
States and Countries. The recognition of these deficiencies has prompted agencies
such as the World Bank to develop and propagate “Sustainable Infrastructure Action
Plans.” The SIAP document (Source: World Bank SIAP Report 2009-11) mentions
four key considerations:
Focus attention on key cross-cutting issues: climate change, the role of the
private sector, regional disparities in infrastructure service delivery, rapidly
growing demand for infrastructure in urbanizing economies, affordability and the
need to support and build upon technological advances;
Need to embed sustainability in infrastructure services going beyond the “do-no-
harm” objectives. In addition to the traditional economic and financial viability of
infrastructure services, the design of infrastructure programs needs to support
environmental sustainability and social inclusion: the “triple bottom line;
Ensure support for a strong governance framework for infrastructure services; and
Leverage its financing by mobilizing additional private financing and harmonized
aid resources for infrastructure, using its (World Bank’s) convening power to
support developing countries.
5.3 The Building Blocks for Karnataka
The deficiencies mentioned in the previous section, and the approach
suggested by the World Bank underline the need for a systematic and focused
approach to infrastructure development, rather than an ad-hoc and reactive
response. There are three “Building Blocks” to achieve this objective:
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Government of Karnataka-Infrastructure Development Department 33
Figure 9: Steps for developing a Sustainable Infrastructure Program
Each of these aspects is outlined in the following:
Convergence & Integration of Infrastructure Plans
As a part of convergence and Integration following steps need to be undertaken
Sector sustainability studies as input for Policy Changes and Reforms
At present the management of several infrastructure sectors is not sustainable
financially, e.g., Power, Irrigation, Urban Infrastructure etc. The sector specific
studies will aim at identifying and putting in place the specific policy changes to make
the sector financially viable so that the private investment can be attracted.
However, to attract private capital, a policy framework has been laid down through
the Karnataka Infrastructure Policy 2007x harnessing private sector investment
through Public Private Partnerships. The policy identifies 10 sectors and 34
subsectors where public-private partnerships are encouraged. Efforts are on to
translate the policy into law. That law shall assure a fair return for investors as well as
protects interests of users to assure quality supply at reasonable cost. Further,
sanctity of contracts would be observed along with ensuring speedy and effective
dispute resolution mechanisms.
Planning for Convergence
& Integration
Leveraging Finances for Shelf of Projects
Building
Capacity
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Government of Karnataka-Infrastructure Development Department 34
Land reforms
With increasing urbanisation, land is always going to be a premium commodity in
urban areas. It is essential to unlock the economic potential of land by liberalising
restrictive provisions in legislation such as 79 A & B of the Land reforms act.
Updation of asset registry, land survey, computerisation of land records, and creation
of land bank of available government lands in each ULB will be done to identify
revenue raising opportunities and optimally develop land for slum rehabilitation,
transport, or for residential, industrial and commercial purposes.
Relief & Rehabilitation (R&R) Policy
In order to speed up the process of land acquisition for the purpose of industries, a
clear cut land acquisition policy will be evolved in consultation with farmers and
industry. In this policy, necessary measures will be spelt out to ensure that only dry
land and single crop land will be acquired for industrial purposes. The policy will also
have a provision to take the land owners as partner in the project by offering certain
equity to them. Alternatively land owners will be offered adequate compensation and
rehabilitation based on the set guidelines.
Establishment of Regulatory Framework
Certainty and rule based revision of user charges / Tariff is a pre-requisite for the
private sector participation. Para 34 of the Infrastructure Policy ’07 lays down the
need for a PPP Regulator with role of setting norms for entry and exist, tariff fixation
and establishing standards for construction, operations and maintenance of the
facilities/ services. Necessary provisions would be made in the PPP Law (being
drafted) in respect of sectors that do not have any regulator e.g.: Minor Ports, State
Highways and Mono rail etc. It may be that one Regulator would handle one sector or
multiple sectors.
Citizen Centric City Planning and Service Provision
ULBs are to give priority attention to provision and improvement of essential basic
services like water supply, sanitation and sewerage to ensure developing of inclusive
cities where every citizen has an entitlement to basic services. Citizens need to be
empowered to decide on the facilities and infrastructure they desire in their localities.
Sustainable Infrastructure – Concept Paper Submission to WBG
Government of Karnataka-Infrastructure Development Department 35
Ward planning involving citizens will be implemented through a bottom-up process as
done in Kolkata. An integrated and efficient public grievance redressal system for
citizens to present their complaints and suggestions will be available in both physical
and online forms (similar to integrated bill payment facilities in ‘Bangalore-one’
centres), in all towns/cities of the State to provide a strong interface, better service
delivery and improved relations between service providers and citizens.
Capacity Building
There is a limited capacity within the government and its agencies to conceptualize,
prepare, procure and manage PPP projects. Capacity Building refers to a very wide
gamut of ‘needs’:
Change stakeholder ‘mindset’ to infrastructure planning
The Governance architecture enabled to appreciate the aspects of sustainable
infrastructure and PPP;
The political executive to ensure continuity in decisions and policies particularly
with reference to PPP and learn to respect contractual terms in PPP;
Building a robust regulatory structure that takes into account the relationship
between the executive, regulator, stake holders, and such regulator or its
appellate body to be the last arbiter without resort to Art 226/ 227 of Constitution
of India and reliefs available for activities under Art 12.
Training Mid and Lower level GoK officials on sustainable PPP project
development areas.
Grading of projects against Environment, Social and Governance factors and
Climate Change.
Create Infrastructure Index in each sector and undertake survey of users of green
infrastructure.
Leveraging Finance for Shelf of Projects
Leveraging Finance
An initial estimate of the funds needed for the selected few projects stands at USD
27816 Mn (Refer table in page 37). GoK has a limited funding capacity for
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Government of Karnataka-Infrastructure Development Department 36
undertaking these projects through its own resource. It is clear that SIAP funding
available from WBG and Government (budgetary) finances would be limited – the
need is to leverage private finances as well. PPPs would also tap efficiencies in the
private sector.
Shelf of Projects
Karnataka intends to develop shelf of sustainable projects through the sector studies.
The following few selected projects have been put forth for consideration as a
starting point.
1. Karnataka Rural Water Supply and Sanitation projectxi
Project Details: Third Water Supply & Sanitation Project covering highly quality
and quantity with the objective to increase rural community’s access to improved
and sustainable drinking water and Sanitation services and to Institutionalize
decentralization of rural water supply and sanitation service delivery to Gram
Panchayaths and user groups. It is proposed to cover 1370 quality and quantity
affected habitations focusing on Fluoride spread over 460 GPs benefiting about
35 lakhs (3.5 million) people across 15 districts (mentioned above) under the
project. This proposed target is out of 14979 quality-affected villages/habitations
comprising 3560 villages/habitations affected with excessive Fluoride in 29
districts of the state
Project Cost: The estimated project cost of Rs.1500 Crores (USD 333.33;
Conversion rate 1USD=45 Rupees) also includes the project management cost of
Rs.110.00 Crores for implementation of the project over a period of 5 years.
Project Benefit: The proposed project will directly benefit to 35 lakhs people living
in the rural Karnataka. The project will help in saving time in collection of water,
increased availability of safe water, reduction in deceases by way of using house
hold latrines and smokeless chulla, better sanitation practices, strengthening
Gram Panchayaths and User Committee etc.
Sustainable Infrastructure – Concept Paper Submission to WBG
Government of Karnataka-Infrastructure Development Department 37
2. Comprehensive Traffic and Transport Planxii- Bangalore
Bangalore population has been growing at a rate of 3.25% per year in
the last decade. There has been a phenomenal growth in the population of
vehicles as well especially the two and four wheelers in this period due to
rising household incomes. In the absence of adequate public transport
system, people are using the personalized modes which is not only leading to
congestion on limited road network but also increasing environmental
pollution. An average Bangalorean spends more than 240 hours stuck in traffic
every year. Such delays result in loss of productivity, reduced air quality,
reduced quality of life, and increased costs for services and goods.
The Comprehensive Transport Plan proposes the following measures:
A. Extension of mass transport system to provide wide coverage and transport
integration with other modes of transport.
B. Provide substantially large network of medium level mass transport system
such as BRT11 to cover the areas beyond the Metro network and on over
loaded corridors.
C. Land use adjustments and densification of corridors along mass transport
corridors where possible.
D. Extension of commuter rail system up to the BMRDA’s New Townships &
beyond up to Tumkur, Hosur etc. to act as sub-urban services.
E. Rationalisation of local bus system and its augmentation.
F Improvement in traffic management. 7 Special facilities for pedestrians
within the entire network specially in the core areas; pedestrian-friendly
development of selected shopping streets inside the core area going to be
served by Metro. Provision of pedestrian sky walks/subways, footpaths and
road furniture along the roads where necessary.
G Diverting through traffic on Peripheral Ring Road. Providing transport hubs
at the junctions of Peripheral Ring Road with important radials such as; the
National Highways and other heavily loaded roads.
11 Bus rapid Transport System
Sustainable Infrastructure – Concept Paper Submission to WBG
Government of Karnataka-Infrastructure Development Department 38
H. Improving primary, arterial and other important roads (particularly radial
and ring roads) by providing grade separation, junction improvements, adding
missing links, widening and other road side facilities wherever necessary. In
gist the transportation architecture would be as below:
Figure 10: Map describing Comprehensive Traffic and Transport Plan
The implementation of the CTTP fully would enable Bangaloreans to perform 73% of
trips through public transport, thus improving the sustainability of traffic while
reducing pollution levels including noise. In fact the externalities of rapid mass
transportation systems are so high that in a 30 year period the costs could be
recovered from externalities alone.
Sustainable Infrastructure – Concept Paper Submission to WBG
Government of Karnataka-Infrastructure Development Department 39
Modes Daily Trips in Lakhs (Modal Split)
2006 2025
Scenario
1
Scenario
2
Scenario
3
Car4.2 (7.5%) 15.5 (12.2%) 9.7 (7.6%) 7.0 (5.5%)
2W18.4 (32.8%) 60.4 (47.5%) 45.6(35.9%) 20.6 (16.2%)
IPT7.3 (12.9%) 14.9 (11.7%) 8.9 (7.0%) 6.7 (5.3%)
Public
Transport26.3 (46.8%) 36.3 (28.6%) 50.0(49.5%) 92.9 (73%)
Total56.2(100%) 127.2 (100%) 127.2 (100%) 127.2 (100%)
TRANSPORT DEMAND ANALYSIS
Note: Scenarios are defined and detailed in CTTP.
Table 8: Transport Demand Analysis in Bangalore
Project Details: The project comprises of Mass Transport System,
City Bus System, Inter-city Bus Terminals, Transport Integration, Transport
System Management Measures, Pedestrian/NMT Facilities, Road Development
Plan, Parking Facilities, Integrated Freight Complexes etc
Project Cost: Rs 46944 Crore (USD 10.43 bn)
Project Benefit: Integrated traffic plan, GHG emission reduction, Environmental
sustainability
3. Water Project for Drinking and Irrigation
Project Details: Government of Karnataka has formulated Upper Bhadra Projectxiii
which is a unique project to utilize 23 TMC of water from the Tunga and Bhadra
Reservoirs for irrigating and drinking water requirement of drought prone areas of
Chitradurga, Tumkur and Kolar districts. The project has a component to desilt
and feed 156 tanks for recharge of ground water.
Sustainable Infrastructure – Concept Paper Submission to WBG
Government of Karnataka-Infrastructure Development Department 40
Project Cost: Rs.5900 crores (USD 1311.11)
Project Benefit: Drought proofing- Meeting the irrigation and drinking water
requirement of drought prone areas of Chitradurga, Tumkur and Kolar districts.
4. Rail Connectivity to Port and Industrial Zonesxiv
Figure 11: Rail Connectivity to Port and Industrial Zones
Project Details: Rail connectivity would comprise of 48 projects of 5525 Km
connecting the major growth centres and ports with the hinder land
Project Cost: Rs 21760 Crore (USD 4835.55 Mn)
Project Benefit: Foster industrial growth, employment and social equity, Integrated
development, GHG emission reduction, Environmental sustainability
Sustainable Infrastructure – Concept Paper Submission to WBG
Government of Karnataka-Infrastructure Development Department 41
5. Connectivity plan between cities and growth zones: Suvarna Karnataka
Development Corridorxv
Project Details: Development of Key road linkages connecting the key economic
centres
Project Cost: Rs 3893 Crore (USD 865.11 Mn)
Project Benefit: integrated development, Regional and Social Equity
6. Comprehensive Development Plan of Rural Roadsxvi in Karnataka
Project Details: The proposed project is aimed to provide improved access of
Rural Community by providing connectivity for villages to the marketing centers,
hospitals, educational institutions, major highways towns and uplifting the
economic and social welfare of the rural poor. The Project also serve to create
new economic opportunities and activities, generate additional employment and
income, facilitate and improve delivery of other rural services and enhance
democratic processes and skills among rural poor.
Project Cost: Comprehensive Development Plan of Rural Roads requires a total
funding of Rs 54427 Crore (USD 12,094 Mn). GoK has been able to carry forward
many of the projects with assistance. There are projects worth USD 1737.33 Mn
which need to be funded.
Project Benefits: Social inclusion, Social Equity, access to economic opportunities
7. Gas based powerxvii projects
Project Details: The Gas Authority of India Ltd (GAIL) has plans to lay a pipeline
from Dabhol to Bangalore (See map below) and another from Mangalore to
Bangalore. A third pipeline is being laid from tap-off from Reline pipeline in
northern Karnataka. GoK has plans to generate over 9000 MW of gas based
green power all along the pipeline.
Sustainable Infrastructure – Concept Paper Submission to WBG
Government of Karnataka-Infrastructure Development Department 42
Figure 12: Dhabol- Bangalore Gas Pipeline and Spur-lines
Project Cost: Rs 36,000 Crores
Project Benefit: GHG emission mitigation, access to gas by all class of users.
8. Renewable Generationxviii:
Project Details:
i. RE Capacity Addition from 2400 MW to about 6600 MW by 2014. To
generate 12800 MU RE by 2014
ii. (ii) Energy Conservation & Energy efficiency 7900 MU (900 MW)
Project Benefit: GHG emission mitigation, Environmental sustainability
Sustainable Infrastructure – Concept Paper Submission to WBG
Government of Karnataka-Infrastructure Development Department 43
Other Project in Planning Stage
The State Govt is currently working on several projects which will be subsequently
posed for sustainable funding:
Industry Specific Development Corridor (In planning stage)
To provide connectivity a number of road, rail, and logistics projects on the anvil.
New Port facilities are also planned. But these have to be integrated.
Social infrastructure projects in Health and Education.
Similarly, there are a number of urban transport projects across the state (6 Major
cities excepting Bangalore), including the development of ring roads, arterial
roads, grade-separators etc. Again, the concern is to integrate them to provide
seamless service to users.
As on Nov 2010, Karnataka has 90 projects of cost Rs 67,789.42 Crores. These
are being developed through PPP route by various depts. and agencies of GoK
Refer Annexure I.
Among these 90 projects, 23 are key projects whose status is given below.
Sustainable Infrastructure – Concept Paper Submission to WBG
Government of Karnataka-Infrastructure Development Department 44
Sl
No
Name of the Project Project cost (Rs Crore)
Relevance Status
Sustainable Infrastructure – Concept Paper Submission to WBG
Government of Karnataka-Infrastructure Development Department 45
1 Bellary Airport 140 Connectivity
Steel City- Fast
growing region
Project Development
Agreement to be
signed
2 High Speed Rail 6689
(completion
cost)
Connects City to
Airport - BIAL
RFP Stage; Bid by
12/08/2010
3 Sea Port at PORTS
Tadri
(35 MT expandable to
114 MT)
3000 Phase - I To serve the
Cement, Steel &
auto Region
RFQ issued on 15th
Apr; Response by – 30
June 2010 (Pre-bid
on 05/06/2010)
4 Sea Port at Haldipur
(19MT- Swiss
Challenge Project-
MEL)
1900 To serve the
Cement, Steel &
auto Region
DPR under Progress;
Bid by Dec 2010
5 Monorail Project in
Bangalore- Corridor-
31 Km
5600 To serve as feeder to
Metro
DPR under process
6 Monorail Project in
(Swiss Challenge-
15KM- SCOMI-
GEODESIC)
2100 To serve as feeder to
Metro
DPR Stage
Bid likely by end
June or July 2010
7 Energy /Gas Pipeline
Project s
7000 by GAIL From Dhabhol-
Bangalore
Under
implementation; COD
by Mar 2012.
8 City Gas distribution Green Field
Development
Feasibility
Underway; Likely to
be taken up in 12
towns/ cities along
the Gas pipeline.
Sustainable Infrastructure – Concept Paper Submission to WBG
Government of Karnataka-Infrastructure Development Department 46
9 Mega Power Projects
(Three projects of
700MW each)
10500 To meet the
Karnataka’s Power
needs
Gas based: PCKL-
2100 MW (Feasibility
study done)
Belgaum, Gadag,
Davangere; Bid by
June 2010
KPCL-1400 MW;
10 Railway projects
(2421 KM)
(1428 km - under
progress +892km -
newly sanctioned )
14000 To improve
connectivity to
ports, Industrial
Zones.
1428 kms of Rail
works under
implementation. In
2010-11, 9
projects have been
approved . Out of
this for 5 projects
GoK has approached
Railways for sanction
on PPP:
1. Hubli- Ankola,
2. Talaguppa-
Honnavar,
3.Kudchini- Bagalkot,
4.Bijapur- Shahbad,
5.Dharwad-
Belgaum.
DPR ready for first
three.
11 Roads (general) 3500 1600 km NIT by Jun/July
2010
(partly issued)
16 VADA- Industrial
Infrastructure
30345 State - of - the Art
Industrial Park over
500 Sq Km in Bellary
Feasibility done; RFQ
by June / July 2010
Sustainable Infrastructure – Concept Paper Submission to WBG
Government of Karnataka-Infrastructure Development Department 47
Therefore, there is a need – at the State and City levels – to have capacities built in
the planning bodies who could take on board partnership between Government,
17 Convention Centre at
Devanahally (Tourism)
1050 Will be the largest in Bid Process
completed
18 Other Tourism
ProjectsTourism
Projects
1621 Tourism circuits,
Golf Course,
Aquamarine, etc.,
Partly under bid
19 Logistic Park at 154 (Phase -
I)
Transportation,
storage and Logistics
in
Feasibility & DPR
Stage
20 Devanahalli Business
Park
9500 Business Hub by the
side of the fastest
growing Airport-
Bangalore
RFQ by end June
2010
21 7 Intermodal Terminal
HUBs
(6 in Bangalore 1 in
Mangalore); To
povide seamless
interchange
Feasibility Study
done for Peenya,
Yeshvantpur,
Yelahanka, Mysore
Road, Majestic &
Bayappanahalli
22 Airstrips at Raichur,
Gadag, Bagalkot and
ChikkmangalurAirstrips
Projects
145 Air connectivity to
Districs
PPP Annuity – Bid in
June 2010
23 Renewable Energy 23890
(by 2014)
Sustainable Energy Under
Implementation
Sustainable Infrastructure – Concept Paper Submission to WBG
Government of Karnataka-Infrastructure Development Department 48
Industry, Academia and NGOs; the latter could take a holistic view of the planning
process.
Stages of Sustainability program
The following principles have been adopted for estimating the SIAP funding
For different type of projects different level of SIAP funding has been sought
mostly varying from 10% to 33.33% depending on the need.
The shelf of projects is of an enormous size. The same has to be taken up in
phases as per priority. Phase I: Started and Completed in 11th Plan (FY 2007-
12), Phase II: Started in 11th Plan (before FY 12) and Completed in 12th Plan (Yr
2012-17), Phase III: Started and Completed in 12th Plan (FY 2012-17)
The Sustainable Funding requirement based on- project cost and %age assistance
sought, comes to 6515.56 USD Millions. Phase wise breakup of the assistance would
be, Phase I- USD 771.47 Mn, Phase II- USD 4623.23 Mn, Phase III- USD 1120.85
Mn. The gist of projects is as per the table below:
Table 9: Projects for Sustainable Funding: Costs, %age assistance sought, Phasing, Phase-wise fund requirement
Sl No Sector
Projects
No
Cost Remarks Assistan
ce as %age of Projects
Cost
Phases12 Sustainable Fund Requirement in
Phases (USD Mn)
(USD million)
(PPP/ Other) I, II, III Phase I Phase II Phase III
1 2 3(a) 3(b) 4 5 6 7 8 9
PPP projects in sectors needing sustainability funding
1 Agri-Infrastructure 8 190.17 PPP 20% Phase I 38.03
2 Energy 4 1633.33 PPP 20% I (50%) II (50%) 163.33 163.33
3 Industrial Infrastructure 15 5410.22 PPP 10% I 541.02
4
Transportation & Logistics((a)CTTP Bangalore, (b) KSHIP and KRDCL Road Projects 86 11208.54
PPP/ Other 20%
II (50%) III (50%) 1120.85 1120.85
5 Tourism 7 258.78 PPP 10% I 25.88
6 Urban & Municipal Infrastructure 2 32.07 PPP 10% I 3.21
Individual Infrastructure projects needing sustainability funding
12 The shelf of projects is of an enormous size. The same has to be taken up in phases as per priority. Phase I: Started and Completed in 11th Plan (FY 2007-12), Phase II: Started in 11th Plan (before FY 12) and Completed in 12th Plan (Yr 2012-17), Phase III: Started and Completed in 12th Plan (FY 2012-17).
Sustainable Infrastructure – Concept Paper Submission to WBG
Government of Karnataka-Infrastructure Development Department 50
7
Karnataka Rural Water Supply and Sanitation project 1 333.33 Other 33.33% II 111.11
8
Water Projects for Drinking and Irrigation 1 1311.11 Other 33.33% II 436.99
9
Connectivity plan between cities and Growth Zones- Rail 48 4835.56
PPP/ Other 20% II 967.11
10
Connectivity plan between cities and Growth Zones-Road 1 865.11 PPP 10% II 86.51
11
Comprehensive Development Plan of Rural Roads in Karnataka13 1 1737.33
Other/ PPP 100% II 1737.33
TOTAL 174 27815.55 771.47 4623.23 1120.85
Total Ass-istance 6515.56
13 Comprehensive Development Plan of Rural Roads requires a total funding of USD 12,094 Mn. GoK has been able to carry forward many of the projects with assistance. There are projects worth USD 1737.33 Mn which need to be funded.
5.4 Support Required by the Government of Karnataka
Of the three strategic interventions that are required by the Government of
Karnataka, the aspect of ‘leveraging finance’ will follow as a natural corollary of the
first two: (i) Planning for integration and convergence and (ii) capacity building. Most
of the infrastructure projects particularly in Transportation, Water require support by
way of Viability Gap Funding. In projects under a) transport (roads& bridges,
railways, sea ports, Inland Waterways) b) Energy (Conventional and renewable
energy), c) Urban infrastructure (Transport, Water Supply, sewerage, Solid Waste
management) d) Infrastructure projects in SEZs, e) International Convention Centres
and other tourism infrastructure projects, f) Social infrastructure (Health, Education);
if undertaken on PPP, upto 20% VGF is available from GOI. However the projects
under Railways, urban transportation, renewable energy and social infrastructure are
is not viable with this assistance. These projects would need SIAP funding. WBG
could be in a position to lend marginal support in this.
The World Bank group is in an eminent position to provide this support to the
Government of Karnataka, and use the opportunity to demonstrate the benefits of
sustainable infrastructure planning in a concrete and conducive environment. The
Government of Karnataka needs support in terms of:
Know how, and the technical assistance required- stage I and II; and
Funding for Sustainable Infrastructure- stage III
5.5 Assessment of Funds
The project is envisaged to be completed in 3 Stages
Stage I: Addressing the Access Gap through Core Sector Strategies and
Maximizing Effectiveness through cross sectoral themes
Stage II: Rolling out Infrastructure Sustainability Plan
Stage III: Funding for Sustainable Infrastructure for Project Implementation
The following table sets out an estimate of funds required for the activities envisaged
for the technical assistance for Sustainable Infrastructure Planning in Karnataka:
Sustainable Infrastructure – Concept Paper Submission to WBG
Government of Karnataka-Infrastructure Development Department 52
Table 10: Sustainable Infrastructure Action Plan for Karnataka
Sustainable Infrastructure Action Plan for Karnataka
Phasing SIAP Theme SIAP Key Steps
Activity Description for
Karnataka
Fund Requirement
(USD Mn)
Stage I: Six Months
A. Addressing
the Access Gap
through Core
Sector
Strategies Sector Strategy
1. Master Plan for Infrastructure
Sectors- Transportation, Energy,
Water, ICT etc
2. PPP Regulation 1.0
B. Maximizing
Effectiveness
through cross
sectoral themes
1. Climate Change
2. Public Private
Partnership
3. Rural-Urban
Integration
1. Institutional Strengthening
Program for Harnessing
Karnataka Specific Cross Sectoral
Synergy- Climate Change, PPP
and R-U Integration 2.0
2. Capacity Building 1.0
Stage II: Six Months
C. Sustainability
Program
1. Environment
2. Social
3. Governance
4. Viability
1. Funding for grading of
projects against Environment,
Social and Governance factors
and Climate Change 0.5
2. Capacity Building within Gov
Stake Holders 1.5
3. Awareness Building among
Infrastructure users 2.5
4. Create Infrastructure Index
and undertake survey of users of
these green infrastructure 0.5
5. Setting up of Regulatory
Structures 5.0
6. Project Level Monitoring
through a Robust MIS 5.0
7. Supporting Viability funding See below
D. Leverage
finance
1. Private Finance
2. Managing Risks for
Public Finance
3. Mobilizing Aid
Resources
4. Harmonizing Aid
Policies through
Partnerships
1. Development of program for
financing projects based on their
emphasis on key factors as
Climate Change, Environmental,
Social and Governance etc. 1.0
Sustainable Infrastructure – Concept Paper Submission to WBG
Government of Karnataka-Infrastructure Development Department 53
2. Funding for grading of
projects based on complex
parameters 5.0
3. Capacity Building 1.0
Stage III: After 12 Months
E. Creation of
Fund and
Project Funding
1. Creation of 'Sustainable Fund'
for Project Grant/ Finance (Refer
Table in Para 5.3 ‘Leveraging
Finance’) 6515.56
Total (USD Mn) 6541.56
The Govt of Karnataka requests that the Technical Assistance Loan of USD 26 Mn
for stage I and II for undertaking sector strategy and sustainability program may be
provided by WBG, initially. Subsequently, based on the evolution and success of
stage I and II, funding for stage III may be provided by the WBG based on sector
programs and specific projects as they take concrete shape.
Sustainable Infrastructure – Concept Paper Submission to WBG
Government of Karnataka-Infrastructure Development Department 54
6. Way forward
The following way forward is envisaged for the project.
Stage I: 0-6 Months
1. Addressing the Access Gap through Core Sector Strategies and Maximizing
Effectiveness through cross sectoral themes
Master Plan for Infrastructure Sectors- Transportation, Energy, Water, ICT etc
Institutional Strengthening Program for Harnessing Karnataka Specific Cross
Sectoral Synergy- Climate Change, PPP and R-U Integration
Capacity Building
Stage II: 6-12 Months
2. Stages II: Rolling out Infrastructure Sustainability Plan
Funding for grading of projects against Environment, Social and Governance
factors and Climate Change
Capacity Building within Gov Stake Holders
Awareness Building among Infrastructure users
Create Infrastructure Index and undertake survey of users of these green
infrastructure
Setting up of Regulatory Structures
Project Level Monitoring through a Robust MIS
Supporting Viability funding
Stage III: After 12 Months
3. Project Implementation
Development of program for financing projects based on their emphasis on
key factors as Climate Change, Environmental, Social and Governance etc.
Funding for grading of projects based on complex parameters
Capacity Building
Creation of 'Sustainable Fund' for Project Grant/ Finance to the tune of 20%
on projects meeting Sustainability Criteria.
Sustainable Infrastructure – Concept Paper Submission to WBG
Government of Karnataka-Infrastructure Development Department 55
7. Conclusion Social inclusion and Environmental sustainability in addition to Financial Viability
are the three cornerstones of any Sustainable Infrastructure Project. The same has
been embraced in Vision 2020 document (Oct 2008) of GoK. If the required
infrastructure are not developed and managed properly, the achievement of the
Development Targets as set out by GoK would be difficult and would impact the poor
the most living in rural areas. Access, greater reliability and equitable distribution of
Sustainable Infrastructure distinguishes the ‘haves’ from the ‘have-nots’ and paves
way for human development, thus reducing the disparity among social classes.
India is new to partnering with private sector as equal partners in the PPP mode.
The relationship between State and the private partner has to be based on equity
and sharing. In most PPP projects the PPP partner would be discharging State’s
monopoly functions. The treatment of such partnership has to evolve, as the
processes in normal democratic process of decision making following elaborate
procedures in the State Governance structure, if copied to such partnership could
jeopardize the efficiency and speed that private sector could command in delivery of
quicker and quality services/ outcomes to the community. But the modalities in such
relationships are yet to be defined in the context of Art 12 and 14 of the Constitution
of India, the RTI Act and the Legislative sovereignty.
The Action plan requires enormous support in capacity building in improving skill
levels in Governance, expertise in conceiving and modeling projects and in achieving
the triple bottom- lines. The Govt of Karnataka requests that the Technical
Assistance Loan of USD 26 Mn for stage I and II for undertaking sector strategy and
sustainability program may be provided by WBG, initially. Subsequently, based on
the evolution and success of stage I and II, funding for stage III may be provided by
the WBG based on sector programs and specific projects as they take concrete
shape.
PTO.
Sustainable Infrastructure – Concept Paper Submission to WBG
Government of Karnataka-Infrastructure Development Department 56
GoK would endeavor to implement sustainable infrastructure and would actively seek
the support of WBG in financial assistance and capacity building services.
V Madhu
Principal Secretary, IDD, Govt of Karnataka
Room No 8, Vikasa Soudha, Dr Ambedkar Veedhi,
Bangalore- 560001, Karnataka
Phone 080-22035085
Email: [email protected]
Principal Secretary
Bangalore
Nov 2010.
Sustainable Infrastructure – Concept Paper Submission to WBG
Government of Karnataka-Infrastructure Development Department 57
BIBLIOGRAPHY
i Source: Karnataka State Planning Board, “Karnataka – A vision for Development,” December 2008,
Chapter 1 & 2.
ii Ibid i Page 60
iii Ibid i Page 18
iv Ibid i Page 19
v Ibid i Page 23, 26, 29, 32, 36, 39, 42
vi Ibid i Page 46
vii As per Industrial Policy ’09 Para 5.3.6 Pg 8 [www.karnatakaindustry.gov.in]
viii As per Industrial Policy ’09 Para 5.3.4 & 5.3.4 Pg 8
ix Ibid i Page 52
x Source: Infrastructure Development Department, http://idd.kar.nic.in/infrastructure.htm
xi Source: Rural Development and Panchayath Raj Department
xii CTTP Study undertaken by KUIDFC.
[http://www.kuidfc.com/WEBSITE/WebPage.nsf/lookupAllCat/Resources-
Traffic%20Management%20Plan-Traffic%20Management%20Plan-CTTP-Bangalore]
xiii Source: Upper Bhadra Project by<>
xiv Source: Infrastructure Development Department
xv Source: Karnataka State Highway Improvement Project-II
xvi Source: Rural Development and Panchayath Raj Department
xvii Source: Power Company of Karnataka Limited
xviii Source: Power Company of Karnataka Limited`