Infrastructure is generally defined as the physical framework of facilities through which goods and services are provided to the public or the rails on which the wheels of the economy move. The infrastructure sector covers a wide spectrum of services such as transportation (including roadways, railways, airways and water transportation); power generation, transmission and distribution; telecommunication; port handling facilities; water supply; sewage disposal; irrigation; medical; educational and other primary services. Infrastructure development is a necessary precondition for the integrated development of the economy.
Rural infrastructure covers within its ambit, economic infrastructure such as transport and communication, power, irrigation, credit, marketing, storage and processing, animal husbandry, dairying and fisheries, information technology and social infrastructure namely education, health, drinking water, sanitation, research and extension.
Infrastructure" is an umbrella term for many activities referred to as "social overhead capital". The term infrastructure encompasses investments which create the base for direct economic activities and generation of income. Investment in rural infrastructure creates new economic opportunities and activities, generates additional employment and income, facilitates and improves delivery of other rural services, enhances linkages of rural and urban areas, lowers production costs, facilitates access to institutional finance and vitally up-scales democratic processes and skills amongst the rural poor.
The World Development Report 1994 (Published by the World Bank) focuses on economic infrastructure and includes services from :
•Public utilities - power, telecommunications, piped water supply, sanitation and sewerage, solid waste collection and disposal, and piped gas.
•Public works - roads and major dam and canal works for irrigation and drainage, cold stores cold chains / market yards etc.
•Other transport sectors - urban and interurban railways, urban transport, ports and water ways, and airports.
Risks in Implementation of Rural Infrastructure
As already stated; Investment in rural infrastructure creates new economic opportunities and activities enhances democratic processes and skills among rural poor. Rural lifestyles in India are getting upgraded now and aspiration levels increasing and these need to be catered to by improved rural infrastructure in the nation.
The Rural Infrastructure scenario can be set up with comparative ease in the plains while its implementation presents a challenge in difficult terrain due to the topography and geographical conditions impacting on logistics, labour availability and material. The cost per unit increases and the period for implementation also gets lengthened in most projects in tougher terrain as compared to the implementation of projects in a more conducive terrain. The maintenance of rural infrastructure projects in tougher terrain also poses challenges due to the varied climatic and geographic conditions. However sound governance can create and facilitate the creation of a sound infrastructure base even in difficult conditions.
The basic issue affecting most Rural Infrastructure Projects is the inability of the implementing agency to draw up realistic project implementation schedules before initiating the process of construction. A systems & process approach for each project with an integrated MIS for regular review if embedded in agencies tasked with the creation of rural infrastructure could minimize risks. The risks can be studied from the viewpoint of the financing agency, the government, the implementing agency or the ultimate beneficiary. The main risks across all these stakeholders are normally as follows –
Completion and Cost Over Run Risk - The implementing agencies involved with rural infrastructure often work by a programme approach rather than a project approach. Delays in land acquisition, excessive time taken over according administrative approvals and technical sanctions also often contribute to delay in initiating construction. Designs are also often finalized late after finalizing funding or obtaining approval for a project. These delays can affect the completion deadline or inflate the cost of the project making it unviable.
Operating Risk. – The allocation of funds for maintenance is a necessity or the assets created at a considerable cost often become derelict or unable to generate the expected benefits. Projects are designed for a certain scenario, say a road is designed based on the expected traffic (tractors, the normal commercial traffic, light vehicles etc), plus produce available in the area as also the population residing in the pocket. In case heavy commercial traffic movement starts on such a newly strengthened or constructed rural road, its inability to bear the load is certain. Likewise, in flood control projects, the design is for the maximum flood impact scenario in the past, any excessive flooding beyond the design would impact the projects adversely. Siltation due to jacketing of rivers in another problematic scenario in the long term for flood protection projects involving embankments. Quality issues also get incorporated in this risk factor, depending on the process used to assure quality in implementation, the periodicity of inspection by senior officials and the correctives applied.
Construction Risk - This is essentially a two fold issue; human resources and material. Rural projects are often complex and need the allocation of experienced & trained staff who are motivated to own the projects. This is often lacking in governmental agencies, specially the imparting of training. The major rural infrastructure projects often involve the coordination of major autonomous departments, such as Revenue, Finance, Engineering to maintain the tempo of execution; this is complex when clearances and coordination is required across departments. Tendering and contracting often cause problems due to site location (remote, logistics, tough terrain) or the allocation work to multiple contractors on small sub components or stretches of a road. It would be pertinent to add here that most governmental departments have a history and are depositories of knowledge, only its codification and application undergoes turbulence due to often extraneous factors.
Environmental Risk - As of today this is major risk and an area of concern. A drainage project may impact a forest area or sanctuary. Roads may be needed to be constructed in a landslide prone area or forest, this could be an acute problem where a road needs to be widened and strengthened for catering to heavy traffic but this involves a forested area through which it passes. Permission to construct even small dams or weirs may require in depth studies of impact and consequential redesigning . Another scenario is that a dam may not be constructed to its full height due to environmental concerns, this would adversely impact projects dependent on the height for gravity flow for water or irrigation needs. In case independent agencies are involved for the drinking water or irrigation projects, they have to analyse and account for environmental aspects of the dam before taking up such projects. The trade off between needs and the environment is complex but can certainly impact the process of conceiving and construction of a project.
Political / Legislative Risk – This is a reality in the intricate interplay of political forces and perceived benefits in most states. A project, well designed and on way to fruition may be slowed in implementation due to a change in the political party in power. Priorities can be dictated by ideology or loyalty to a particular region. However overarching priorities do impart a certain stability, such as drainage and watershed works in the flat alluvial plains are often not affected by such risks as it suits all stakeholders and is their collective concern to have a conducive infrastructure. An area of concern remains the loyalties of petty contractors in rural areas to particular political groups, these do impact at times the continuity of projects as leaders feel constrained at times to reward loyalty by contracts. This factor at times can be major risk, that is, the complex and intricate relationships which permeate rural power relationships and their impact on the operating environment.
Financial Risks - This could be an area of concern in case of projects involving partnerships with private players where the state share may not be applied to the project as envisaged. In projects owned by the state, the main concern is budgetary provisions as per the demand of the project. The tendency to split funds across multiple projects also delays projects and adds to inflation in costing. The constraint of funds with the owner of the project, mostly the state government; can adversely impact the longevity of projects due to reduced maintenance allocations. Another component of financial risk is the reluctance of beneficiaries to pay for the service, this impacts the possibility of projects earning their own return on investment and remaining dependent on governmental funds. This also leads to the private sector opting to stay away from rural infrastructure projects.
Management Risk – The staffing pattern of the implementing agencies, their reach and ability to manage the project (example the agency is awarded a contract 300 kms away from its base or has limited operational staff for one off projects), project management skills, the training imparted and updating of knowledge on a continuous basis are all areas of concern. These are vital to the success of any project. The HR aspects are a gray area in most governmental departments even today. This has to be coupled with the ability to effectively monitor the progress of projects from conception to completion and then its maintenance. An effective real time Management Information System for assessing progress and a regular review of the issues such as Approvals, Designs, Tendering, Physical Progress and commensurate Financial Expenditure, timely and accurate lodging of financial expenditure claims, application of sanctions for necessary deviations etc. is often held hostage to mundane cumbersome office procedures. An added concern is the reluctance of sub contractors and labour to work on far flung and scattered projects, which is a characteristic of most rural infrastructure projects.
Technological Risk – Normally, most rural infrastructure projects involve technological applications which have been standardized over a period of time. Introducing a new technology involves training and overcoming barriers at the field level, such as a pump operator having to maintain a technologically advanced filter machine in a drinking water project abd being reluctant about it. PERT / CPM processes are rarely observed to be used effectively in addition to technological applications. The need for upgrading technological applications is genuine but is closely interwoven with capacity building and training as also hand holding at the initial stages.
These are the main risks often faced by agencies while striving to upgrade the rural infrastructure. Some are manageable while some would be inherently risky, such as constructing a new road in mountainous terrain or a flood protection project in the plains. =============================================================
Rural infrastructure covers within its ambit, economic infrastructure such as transport and communication, power, irrigation, credit, marketing, storage and processing, animal husbandry, dairying and fisheries, information technology and social infrastructure namely education, health, drinking water, sanitation, research and extension.
Infrastructure" is an umbrella term for many activities referred to as "social overhead capital". The term infrastructure encompasses investments which create the base for direct economic activities and generation of income. Investment in rural infrastructure creates new economic opportunities and activities, generates additional employment and income, facilitates and improves delivery of other rural services, enhances linkages of rural and urban areas, lowers production costs, facilitates access to institutional finance and vitally up-scales democratic processes and skills amongst the rural poor.
The World Development Report 1994 (Published by the World Bank) focuses on economic infrastructure and includes services from :
•Public utilities - power, telecommunications, piped water supply, sanitation and sewerage, solid waste collection and disposal, and piped gas.
•Public works - roads and major dam and canal works for irrigation and drainage, cold stores cold chains / market yards etc.
•Other transport sectors - urban and interurban railways, urban transport, ports and water ways, and airports.
Risks in Implementation of Rural Infrastructure
As already stated; Investment in rural infrastructure creates new economic opportunities and activities enhances democratic processes and skills among rural poor. Rural lifestyles in India are getting upgraded now and aspiration levels increasing and these need to be catered to by improved rural infrastructure in the nation.
The Rural Infrastructure scenario can be set up with comparative ease in the plains while its implementation presents a challenge in difficult terrain due to the topography and geographical conditions impacting on logistics, labour availability and material. The cost per unit increases and the period for implementation also gets lengthened in most projects in tougher terrain as compared to the implementation of projects in a more conducive terrain. The maintenance of rural infrastructure projects in tougher terrain also poses challenges due to the varied climatic and geographic conditions. However sound governance can create and facilitate the creation of a sound infrastructure base even in difficult conditions.
The basic issue affecting most Rural Infrastructure Projects is the inability of the implementing agency to draw up realistic project implementation schedules before initiating the process of construction. A systems & process approach for each project with an integrated MIS for regular review if embedded in agencies tasked with the creation of rural infrastructure could minimize risks. The risks can be studied from the viewpoint of the financing agency, the government, the implementing agency or the ultimate beneficiary. The main risks across all these stakeholders are normally as follows –
Completion and Cost Over Run Risk - The implementing agencies involved with rural infrastructure often work by a programme approach rather than a project approach. Delays in land acquisition, excessive time taken over according administrative approvals and technical sanctions also often contribute to delay in initiating construction. Designs are also often finalized late after finalizing funding or obtaining approval for a project. These delays can affect the completion deadline or inflate the cost of the project making it unviable.
Operating Risk. – The allocation of funds for maintenance is a necessity or the assets created at a considerable cost often become derelict or unable to generate the expected benefits. Projects are designed for a certain scenario, say a road is designed based on the expected traffic (tractors, the normal commercial traffic, light vehicles etc), plus produce available in the area as also the population residing in the pocket. In case heavy commercial traffic movement starts on such a newly strengthened or constructed rural road, its inability to bear the load is certain. Likewise, in flood control projects, the design is for the maximum flood impact scenario in the past, any excessive flooding beyond the design would impact the projects adversely. Siltation due to jacketing of rivers in another problematic scenario in the long term for flood protection projects involving embankments. Quality issues also get incorporated in this risk factor, depending on the process used to assure quality in implementation, the periodicity of inspection by senior officials and the correctives applied.
Construction Risk - This is essentially a two fold issue; human resources and material. Rural projects are often complex and need the allocation of experienced & trained staff who are motivated to own the projects. This is often lacking in governmental agencies, specially the imparting of training. The major rural infrastructure projects often involve the coordination of major autonomous departments, such as Revenue, Finance, Engineering to maintain the tempo of execution; this is complex when clearances and coordination is required across departments. Tendering and contracting often cause problems due to site location (remote, logistics, tough terrain) or the allocation work to multiple contractors on small sub components or stretches of a road. It would be pertinent to add here that most governmental departments have a history and are depositories of knowledge, only its codification and application undergoes turbulence due to often extraneous factors.
Environmental Risk - As of today this is major risk and an area of concern. A drainage project may impact a forest area or sanctuary. Roads may be needed to be constructed in a landslide prone area or forest, this could be an acute problem where a road needs to be widened and strengthened for catering to heavy traffic but this involves a forested area through which it passes. Permission to construct even small dams or weirs may require in depth studies of impact and consequential redesigning . Another scenario is that a dam may not be constructed to its full height due to environmental concerns, this would adversely impact projects dependent on the height for gravity flow for water or irrigation needs. In case independent agencies are involved for the drinking water or irrigation projects, they have to analyse and account for environmental aspects of the dam before taking up such projects. The trade off between needs and the environment is complex but can certainly impact the process of conceiving and construction of a project.
Political / Legislative Risk – This is a reality in the intricate interplay of political forces and perceived benefits in most states. A project, well designed and on way to fruition may be slowed in implementation due to a change in the political party in power. Priorities can be dictated by ideology or loyalty to a particular region. However overarching priorities do impart a certain stability, such as drainage and watershed works in the flat alluvial plains are often not affected by such risks as it suits all stakeholders and is their collective concern to have a conducive infrastructure. An area of concern remains the loyalties of petty contractors in rural areas to particular political groups, these do impact at times the continuity of projects as leaders feel constrained at times to reward loyalty by contracts. This factor at times can be major risk, that is, the complex and intricate relationships which permeate rural power relationships and their impact on the operating environment.
Financial Risks - This could be an area of concern in case of projects involving partnerships with private players where the state share may not be applied to the project as envisaged. In projects owned by the state, the main concern is budgetary provisions as per the demand of the project. The tendency to split funds across multiple projects also delays projects and adds to inflation in costing. The constraint of funds with the owner of the project, mostly the state government; can adversely impact the longevity of projects due to reduced maintenance allocations. Another component of financial risk is the reluctance of beneficiaries to pay for the service, this impacts the possibility of projects earning their own return on investment and remaining dependent on governmental funds. This also leads to the private sector opting to stay away from rural infrastructure projects.
Management Risk – The staffing pattern of the implementing agencies, their reach and ability to manage the project (example the agency is awarded a contract 300 kms away from its base or has limited operational staff for one off projects), project management skills, the training imparted and updating of knowledge on a continuous basis are all areas of concern. These are vital to the success of any project. The HR aspects are a gray area in most governmental departments even today. This has to be coupled with the ability to effectively monitor the progress of projects from conception to completion and then its maintenance. An effective real time Management Information System for assessing progress and a regular review of the issues such as Approvals, Designs, Tendering, Physical Progress and commensurate Financial Expenditure, timely and accurate lodging of financial expenditure claims, application of sanctions for necessary deviations etc. is often held hostage to mundane cumbersome office procedures. An added concern is the reluctance of sub contractors and labour to work on far flung and scattered projects, which is a characteristic of most rural infrastructure projects.
Technological Risk – Normally, most rural infrastructure projects involve technological applications which have been standardized over a period of time. Introducing a new technology involves training and overcoming barriers at the field level, such as a pump operator having to maintain a technologically advanced filter machine in a drinking water project abd being reluctant about it. PERT / CPM processes are rarely observed to be used effectively in addition to technological applications. The need for upgrading technological applications is genuine but is closely interwoven with capacity building and training as also hand holding at the initial stages.
These are the main risks often faced by agencies while striving to upgrade the rural infrastructure. Some are manageable while some would be inherently risky, such as constructing a new road in mountainous terrain or a flood protection project in the plains. =============================================================
Comments
Post a Comment