Nava Karnataka Vision 2025

Report on Infrastructure Sector

December 2017

[Category]

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Contents

1. Overview of Infrastructure Sector in Karnataka 9

1.1. Overview of sector and progress in the last five years 9

1.2. District-level Infrastructure Connectedness Assessment 21

1.3. Sector Benchmark with other states in the country with good practices to emulate 23

1.4. Global Benchmarks by sector 24

1.1. Future state of affairs for the sector in India and Globally 25

1.2. Institutional Framework 26

1.3. Policy and Regulatory Framework 29

1.4. Government Programs and Schemes 31

2. Strategic Analysis of the Sector in Karnataka 34

2.1. Growth Drivers 34

2.2. Challenges 37

2.3. Opportunities 39

2.4. Good Practices and Emerging trends 64

2.5. Stakeholder Consultations 66

3. Vision 2025 for Infrastructure sector 69

3.1. Vision statement for Infrastructure sector in Karnataka 69

3.2. Goals and Strategies for 2025 69

3.3. Implementation Roadmap 82

Annexures 84

Annexure I – Details of various Institutions functioning in Karnataka Infrastructure sector 84

Annexure II – Details of various Government programs and schemes 97

Annexure III – Best Practices 109

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List of Figures Figure 1 Aircraft Movement Statistics (in ’000) March 2016-April 2017 ........................ 13 Figure 2: Passenger Statistics (In ‘000) March 2016-April 2017 ................................... 13 Figure 3: Freight Statistics (In ‘000 MT) March 2016-April 2017 .................................. 13 Figure 4: Traffic Handled at Minor Ports in Karnataka (IN MT) ..................................... 14 Figure 5: Cargo handled by New Mangalore Port (in ‘000 tonnes) ............................... 14 Figure 6: PPP versus Traditional Procurement – Number of projects and cost ............ 18 Figure 7: PPP Projects – Type, Number and Cost Assessment ................................... 18 Figure 8: Traditional Procurement Projects – Type, Number and Cost Assessment .... 19 Figure 9 Growth Drivers for Infrastructure Development .............................................. 35 Figure 10 Potential Inter-State and Intra-State Corridors for Karnataka ....................... 44 Figure 11 Potential Tourism Circuits in Karnataka ........................................................ 45 Figure 13: Agriculture Production Clusters of Karnataka .............................................. 46 Figure 14: Food Processing Clusters of Karnataka ...................................................... 47 Figure 15 Industrial Activity Hubs in Northern and Southern Karnataka ....................... 48 Figure 16: Industrial Infrastructure of Karnataka ........................................................... 48

List of Tables Table 1 Karnataka Road Statistics 2013-17 ................................................................. 10 Table 2: Rural Road Statistics, 2016-17 ....................................................................... 10 Table 3: Railway Network of Karnataka ........................................................................ 11 Table 4: Major Railway projects, 2016-201 ................................................................... 11 Table 5: National Waterways in Karnataka 2017 .......................................................... 16 Table 6: Karnataka waterways ...................................................................................... 16 Table 7 District Connectivity Assessment ..................................................................... 22 Table 8: Comparative assessment of Infrastructure – State-wise ................................ 23 Table 9 List of important National and Institutions for Infrastructure Development in Karnataka ...................................................................................................................... 28 Table 10: Policy and Regulatory Landscape for Infrastructure and Service Delivery in Karnataka ...................................................................................................................... 31 Table 11 List of Key Programs and Schemes by the Government of Karnataka and Government of Karnataka for Infrastructure Development ........................................... 33 Table 12 Current Infrastructure Projects for Reconnecting Karnataka ......................... 42 Table 13: Potential corridor development opportunities for the state ............................ 44 Table 14: Tourism Clusters – Karnataka Tourism Policy 2015-20 ................................ 63 Table 15 Recommendations derived from Stakeholder Consultations ......................... 68 Table 16 Vision 2025 - List of Goals and Strategies for Infrastructure sector in Karnataka ...................................................................................................................... 71

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List of Abbreviations AAI Airports Authority of India ADB Asian Development Bank AMRUT Atal Mission For Rejuvenation and Urban Transformation BBMP Bruhat Bengaluru Mahanagara Palike BDA Bangalore Development Authority BESCOM Bangalore Electricity Supply Company BIAL Bangalore International Airport Limited BLT Build-Lease-Transfer (PPP Model) BMEC Bangalore Mumbai Economic Corridor BMTC Bangalore Mahanagar Transport Corporation BOLT Build-Operate-Lease-Transfer (PPP Model) BOOT Build-Own-Operate-Transfer (PPP Model) BOT Build-Operate-Transfer (PPP Model) BRTS Bus Rapid Transit System BWSSB Bangalore Water Supply & Sewage Board CBIC Chennai Bangalore Industrial Corridor CEZ Coastal Economic Zone CONCOR Container Corporation of India Ltd. DBFOT Design-Build-Operate-Transfer (PPP Model) D-BOOST Design-Build-Own-Operate-Share-Transfer (PPP Model) DFCCIL Dedicated Freight Corridor Corporation of India DIPP Department of Industrial Policy and Promotion DMIC Delhi Mumbai Industrial Corridor DPIWT Department of Ports and Inland Waterways Transport DPR Detailed Project Report DULT Directorate of Urban Land Transport EPC Mode Engineering, Procurement, and Construction Mode EXIM Export Import FDI Foreign Direct Investment GDP Gross Domestic Product GoI Government of India GoK Government of Karnataka GSPD Gross State Domestic Product HDFC Housing Development Finance Corporation Limited HMRDC Hassan-Mangalore Rail Development Company HRIDAY Heritage City Development and Augmentation Yojana ICD Inland Container Depot IDD Infrastructure Development Department iDeCK Infrastructure Development Corporation (Karnataka) Ltd. IDFC Infrastructure Development Finance Company IRSDC Indian Railway Stations Development Corporation Limited JICA Japan International Cooperation Agency KBIC Kochi Bangalore Industrial Corridor KEA Karnataka Evaluation Authority KIA Kempegowda International Airport KIADB Karnataka Industries Area Development Board KMB Karnataka Maritime Board KPTCL Karnataka Power Transmission Corporation Ltd. KRCL Konkan Railway Corporation Limited KRDCL Karnataka Road Development Corporation Ltd. KREDL Karnataka Renewable Energy Development Ltd K-RIDE Karnataka Rail Infrastructure Development Corporation Limited KRRDA Karnataka Rural Road Development Agency KSFC Karnataka State Financial Corporation

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KSHIP Karnataka State Highway Improvement Project KSHTTA Karnataka State Highways Traffic and Transport Authority KSIIDC Karnataka State Industrial Investment and Development Corporation KSRTC Karnataka State Road Transport Corporation KSTA Karnataka State Transport Authority KSTDC Karnataka State Tourism Development Corporation KTPP Act & Rules

The Karnataka Transparency in Public

LEEP Logistics Efficiency Enhancement Program LiDAR Light Detection and Ranging MMLP Multimodal Logistics Park MoHUA Ministry of Housing and Urban Affairs MoR Ministry of Railways MoRTH Ministry of Road Transport & Highways MRO Maintenance, Repair, and Operations (Company) NABARD National Bank for Agriculture and Rural Development NEKRTC North Eastern Karnataka Road Transport Corporation NHAI National Highways Authority of India NHDP National Highways Development Project NIMZ National Investment and Manufacturing Zone NITI Aayog National Institute for Transforming India NMP New Mangalore Port NMPT New Mangalore Port Trust NWKRTC North West Karnataka Road Transport Corporation OEM Original Equipment Manufacturer (Company) OMT Operate-Maintain-Transfer (PPP Model) PBS Public Bike Sharing System PMGSY Pradhan Mantri Gram Sadak Yojana PPP Mode Public Private Partnership Mode PRAMC Planning and Road Asset Management Centre PRASAD Pilgrimage Rejuvenation and Spiritual Augmentation Drive PRI Panchayati Raj Institution PWD Public Works Department PWP&IWTD Public Works Ports & Inland Water Transport Department RCS Regional Connectivity Scheme RD&PR Rural Development and Panchayat Raj RIDF Rural Infrastructure Development Fund RoB Road Over Bridge ROT Rehabilitate-Operate-Transfer (PPP Model) RuB Road Under Bridge SEZ Special Economic Zone SHDP State Highways Development Programme SKDC Suvarna Karnataka Development Corridor SLNA State Level Nodal Agency SPV Special Purpose Vehicle SWR South Western Railways TEFR Techno Economic Feasibility Report TenderSURE Specifications for Urban Roads Execution - 2011 TEUs Twenty-foot Equivalent Units TOD Transit Oriented Development UDAN Ude Desh Ka Aam Nagrik UDD Urban Development Department ULB Urban Local Body WB World Bank

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Executive Summary

Karnataka has experienced high economic growth over the last ten years, with the state GDP

growing at a CAGR of over 13% between 2005-06 and 2015-16 to USD 175.8 billion.

Karnataka is one of the fastest growing states in India. The natural resources, policy

incentives and infrastructure in the state favour investments in the IT/ITeS, biotechnology,

engineering, electronics, automotive, textiles, agriculture and food-processing sector and has

created SEZs and SIRs facilitate this growth. As of December 2017, it ranks 8th on DIPP’s

Ease of Doing Business List and has successfully implemented over 225 of the nearly 375

recommendations under its Business Reforms Action Plan 20171. Karnataka has earned

many sobriquets including ‘Knowledge and Innovation Capital’, ‘Silicon Valley of India’, ‘R&D

Hub’ and ‘Startup Hub’. The state successfully attracts skilled labour, especially in the

knowledge sector and it produces among the highest number of doctors, engineers, and

technically skilled workers in the country.

All of this success needs to have a robust underlying infrastructure. Karnataka has well-

developed social, physical, and industrial infrastructure. It has good road, rail, and air

connectivity and has substantial port infrastructure. Additionally, it has well-developed

telecommunication, water, and power infrastructure to support the state economy. The

Infrastructure Development Department is a nodal agency for the development of

infrastructure in the state. This department is planning, implementing and monitoring roads,

railways, aviation sector. With the increased focus on public-private partnership through

initiative such as Invest Karnataka, the state is poised to become Number 1 State in India for

Ease of Doing Business. Karnataka is the only state with two industrial corridors - CBIC

(Chennai-Bengaluru Industrial Corridor) and BMEC (Bangalore Mumbai Economic Corridor)

in the country where Commerce and Industries department is the nodal department.

The belief in the State’s ability to attain full individual and group potential for upliftment and

a better quality of life, through sustainable and inclusive growth, is reflected in its

Infrastructure Sector Vision –

“To ensure safe, reliable, and environmentally sustainable last mile connectivity across Karnataka in order to achieve increased socio-

economic development of the state.”

The seven goals by which this vision can be realised are listed below –

Goal 1: Enhance regional connectivity of roads ensuring first and last mile connectivity to all

villages.

Goal 2: Develop robust airport and airstrip infrastructure in the state

Goal 3: Augment rail connectivity across the state to deliver a seamless, accessible,

multimodal, and secure transport offering

Goal 4: Develop quality port infrastructure and promote coastal shipping

Goal 5: Develop Corridor Infrastructure to augment cross-sector potential of the state

Goal 6: Attract large investments in the infrastructure sector

Goal 7: Improve accessibility and efficiency of bus public transportation system

The State’s strengths and competitive advantages, which position it well for achieving the

goals are –

1 Business Reforms Action Plan, Department of Industrial Policy and Promotion, 2017 http://eodb.dipp.gov.in/ReportView.aspx?st_id=29&r_id=0, accessed on 10 November 2017

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Progressive policy instruments with the sector being a focus for Central and State

Governments

Stable political climate and policy continuity, critical for large infrastructure projects

Best labour relations in the country – industry-friendly and peaceful

National infrastructure schemes have included Karnataka for several flagship

projects

Pioneer in introducing policies; first to introduce policies for industries, IT, aerospace,

biotechnology, semiconductors, Electric Vehicle and Energy Storage policy and

startups

Established hi-tech digital and new technologies industries; 4th largest global tech

cluster

A competitive and attractive destination for global investments; MoUs already signed

with USA, UK, Japan, Germany and Sweden among other countries as well as with

World Bank and Asian Development Bank; Karnataka attracts the 4th highest FDI in

India

Highest number of industrial training institutes means access to skilled and educated

labour, especially for technically skilled work

Highest degree of openness to export trade

90,000 acres of land bank available, with 40,000 acres notified for industrial purposes

Bengaluru is ranked as the “Best place to live and work for expats” in India

Varied landscapes, fertile land, a long coastline and rich biodiversity.

However, there exist several challenges, which impede it from realising its full potential.

Some of these are –

Development and access to service is not uniform across the state with Bengaluru

receiving outsized focus for infrastructure and investments leading to overburdened

infrastructure in Bengaluru

Outdated legislation and inadequate implementation of policies leading to unplanned,

un-serviced growth and inferior service delivery

Institutions with limited human and financial capacities

Large number of institutions resulting in challenges with coordination and need for

PMU or SPV to guide large infrastructure projects

Ineffective resource management leading to environmental degradation

Infrastructure projects tend to overrun on cost and time, straining existing financial

institutions

Difficulty finding private partners for PPP projects, urgent need to find other financing

options or innovative financing mechanisms under PPP to attract players

Challenges with land acquisition for projects while minimising displacement of people

and impact on environment and natural resources

Vulnerability to climate change-related risks

Hence, the key transformative strategies to achieve targeted interventions in Karnataka

are identified as follows –

Building infrastructure to boost productive potential of the economy

Increasing land availability for infrastructure development

Establishing linkages between lagging and leading districts

Establishing a common database platform and use of technology to facilitate

coordination, monitoring, alignment, transparency and participation among entities

and projects

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Assessing opportunities to collaborate with other businesses, governments, civil

societies, academia, and related institutions to drive innovation and share value

Ensuring connectivity via road, rail, and air to all parts of the state including last mile

connectivity

Developing growth strategies that are efficient and environmentally sound

Using local resources and implementing resource demand-side management

Expanded mobility choices that reduce dependence on the automobile, reduce

transportation costs and free up household income for other purposes

To continuously update the Infrastructure Policy 2015 by taking into account new and

sunrise sectors so as to meet the future aspirations

To ensure adequate and competent manpower and personnel are able to meet the

challenges of infrastructure development, particularly that of Infrastructure

Development Department

The six focus areas for the State’s infrastructure development should thus be –

Comprehensive regional infrastructure development

Resilient growth strategies that are in harmony with natural resources

Maximum focus on expanding

Equal access to physical infrastructure and services

Promoting economic corridor development

Transport-oriented development for industrial and urban clusters

Promotion of Karnataka as an investment destination

Above all, it is imperative to recognise that a single entity or stakeholder cannot accomplish all of this by themselves. Thus, building coalitions, encouraging private enterprises and citizens to partake in the development of quality, reliable, sustainable and resilient infrastructure, including regional and trans-border infrastructure, to support economic development and human well-being, with a focus on affordable and equitable access for all, will ultimately be key to realising the Vision.

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1. Overview of Infrastructure Sector in Karnataka Transport infrastructure is a critical part of a country’s overall infrastructure network. Roads, rail, ports, airports and public transport facilitate the movement of commuters, leisure trips, tourists, freight and goods. Transport infrastructure can thus enable economic growth if the network allows for efficient movement and transport. This section aims to set out a brief context of existing infrastructure and progress made in the last five years.

1.1. Overview of sector and progress in the last five years Adequate regional connectivity and good quality urban transportation networks to facilitate the movement of people and goods are vital for the development of any state. Karnataka has robust physical infrastructure in place and the Government continues to attach high priority to infrastructure development through several ongoing and in-pipeline projects. There are more than two lakh km of roads throughout the state, which are the primary means of transportation across the state, a significant portion of them being covered with asphalt. The rail network is 3821 km long, and the headquarters of the South-Western division of Indian Railways is located at Hubli. There are five public airports in Karnataka, with two of them operating international flights. While there is only one major port currently, more facilities are under development and the state will become reasonably self-sufficient with respect to ports infrastructure in the next 10-15 years. The Bangalore airport is the busiest airport in South India and the third busiest in India. It is also the only state with two industrial/economic corridors - Chennai Bengaluru Industrial Corridor (CBIC) and Bengaluru Mumbai Economic Corridor (BMEC). The state has many building blocks to its credit - It is the largest biotechnology hub In India, It has the largest number of Research & Development centres, the largest number of medical institutes, industrial training institutes; largest software technology parks and third largest number of engineering colleges in India. Karnataka has also been attracting a global audience with it's integrated and strategic growth plans that offer immense investment potential across its varied sectors in manufacturing, agri-business and food processing, technology, energy and infrastructure along with tourism.

Current scenario Roads – Karnataka state is well connected to its five neighbouring states and other parts of India through 25 National Highways and 161 State Highways that run through the state. The State’s road density is third amongst the ten largest states and 13th overall in India. The total length of roadworks completed under Pradhan Mantri Gram Sadak Yojana (PMGSY) I and II in Karnataka was 18536.54 kms and 46 bridges2. An expenditure of INR 4745 Cr was incurred. All habitations having a population more than 500 have been covered under PMGSY. During 2013–17, the state government constructed 8,288 km of road length under the Namma Grama Namma Rasthe Yojane (NGNRY). Further, the state allocated INR 3576.14 crores for improvement of rural roads during 2016-173. In recent years, the focus has been on upgrading the roads – making them durable, all weather, and wider – rather than building new roads. During 2013-17, improvement/renewal of 9644 km of State Highways and 20733 km of Major District Roads have been completed incurring an expenditure of INR 8190 Cr. 1854 km of new National Highway has been upgraded and in principal approval for upgradation of 6433

2 Roads Completed under Pradhan Mantri Gram Sadak Yojana (PMGSY) upto March 2015, Open Government Data (OGD) Platform India, https://community.data.gov.in/roads-completed-under-pradhan-mantri-gram-sadak-yojana-pmgsy-upto-march-2015/, accessed on 10 Dec 2017 3 Ministry of Road Transport and Highways, Government of Karnataka, State Budget, 2016-17.

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km has been obtained from Government of India. Thus, the National Highway network of the state is being increased by 8287 km4.

Category of Road

Year CAGR %

2013-14 2014-15 2015-165 2016-176

National Highways

4,688 6,572 6,572 6,5724 12 %

State Highways

20,773 19,720 19,578 19,578 -2%

Major District Roads

49,683 49,928 49,909 49,909 0.15%

Other Roads (incl. Rural Roads7)

1,63,911 1,63,911 1,84,931 1,84,931 4%

Total Roads 2,39,055 2,40,131 2,60,990 2,60,990 3%

Table 1 Karnataka Road Statistics 2013-17 Source Economic Survey of Karnataka 2015-2016 and 2016-2017

Additionally, construction of 175 bridges on State Highway and 146 bridges on Major district roads have been completed incurring an expenditure of INR 440 Cr. Other development works in the state include – Sustainable Coastal protection works, construction of Cement concrete roads, improvement of municipality roads, development of Central Business District roads, development of roads under the Chief Minister’s Nagarothana scheme, construction of Jattur Bridge across Kagina River, construction of Kudalasangama Adavihala Bridge, etc.

The total length of rural roads in Karnataka as of 2017 is 177,542 kms as per District Rural Road Plans (DRRP).

S No. Type of Road Length (in km)

1 Asphalted Roads 63374.15

2 Water-bound Macadam Roads 23059.07

3 Mud Roads 91109.08

Total 177542.30

Table 2: Rural Road Statistics, 2016-17 Source: Annual Report 2016-17, RDPR

Out of the 120000 km of rural roads connected to rural habitations and marketplaces, 67039 kms of rural road length is asphalted and the balance roads is targeted to be converted to All-weather roads under various schemes like PMGSY, NGNRY, NABARD etc.

Railways – Karnataka is well connected to other parts of the country with a railway network of 3,281 km. The South Western Zone of the Indian Railways is headquartered at Hubballi. Bengaluru is extensively connected through railways with inter-state destinations. However, there is scope for improvement in the intra-state railway connectivity with Karnataka having the lowest rail

4 As of Dec 2017, Department of PWD (1854 km of new National Highway has been upgraded and in principal approval for upgradation of 6433 km has been obtained from Government of India.) 5 Road Network - Karnataka PWD, http://103.241.144.46:81/pdf/road_details_as_on_31-03-2016.pdf, accessed on 15 Nov 2017 6 PWD Road Length as on 31-03-2017, http://103.241.144.46:81/pdf/road_network.pdf, accessed on 01 Dec 2017, accessed on 15 Nov 2017 7 Annual Report 2016-17, Rural Development and Panchayat Raj, http://rdpr.kar.nic.in/english/areport.asp, accessed on 1 Dec 2017

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route and broad gauge density when compared to other southern states. In State Budget 2017-18, the Government has allocated INR 90 crore for Rail Over Bridge and Rail Under Bridge works under progress. Out of Karnataka’s 175 taluks, 81 that account for 46 per cent of the land area do not have rail network.

The State Government with a view to increase the rail density and increase the pace of implementation has agreed with the Ministry of Railways for taking up new railway projects on a 50:50 cost-sharing basis. In the last two years, an amount of INR 1246.59 crore was released by the Government of Karnataka for development of various railway projects in the state. Bengaluru is extensively connected through railways with inter-state destinations. Karnataka Rail Infrastructure Development Corporation (K-RIDE) has been set up with the objective of developing and implementing rail infrastructure projects in Karnataka with private sector participation wherever feasible.

Type of railway Broad Gauge (km)

Medium Gauge (km)

Narrow Gauge (km)

Total (Km)

Southern Central Railways 268 0 0 268

South Western Railways 2516 97 84 2,697

Southern Railways 37 0 0 37

Konkan Railways 248 0 0 248

Total 3069 97 84 3250

Table 3: Railway Network of Karnataka Source: India Brand Equity Foundation Nov 2017, Economic Survey of Karnataka, 2015-16, State Budget 2016-17

The Golden Chariot Train, a high-end luxury train is operated by the Tourism Department of Karnataka and covers two different circuits of South India

Pride Of South covering Goa Southern Splendour covering Kerala Backwaters

The status of 10 cost sharing railway projects in the state are given below.

Railway project Status

Ramanagara-Mysuru doubling track Commissioned for transport

Bidar-Kalaburagi new railway line Completed

Bengaluru-Hasana railway line Commissioned

Bagalakote-Kuduchi railway line Approved by Government of Karnataka; amount released for land acquisitions Ginigera-Raichur railway line

Gadaga-Wadi railway line

Tumkuru Rayadurga railway line

Chikkamagalur-Sakaleshpura railway line

Tumkur Davanagere railway line

Hejjala-Chamarajanagar railway line Alignment and requisitioning of land is completed. Administrative approval is under consideration

Table 4: Major Railway projects, 2016-201

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Source: Infrastructure Development Department, Government of Karnataka, India Brand Equity Foundation Nov 2017, Economic Survey of Karnataka, 2015-16, State Budget 2016-17

In addition to the above, Government of Karnataka has also approved the setting up of FIAT

bogie manufacturing factory by Ministry of Railways at Yadgir District (works completed) and

agreed to set up a Rail Coach Factory in Kolar District for which an MoU entered into between

Railways and Government of Karnataka.

Airports – With five domestic airports located in Bengaluru, Mangalore, Hubballi, Mysore and Belgaum and international airports at Bengaluru (Kempegowda International Airport) and Mangalore (Mangalore International Airport), Karnataka has good air connectivity. Bengaluru International Airport (Kempegowda International Airport); the country’s first Greenfield international airport, has been developed at Devanahalli in Bengaluru as a passenger and cargo hub under PPP and started operations in May 2008. The Belagavi Airport had a new terminal building inaugurated in October 2017 and provides air connectivity to Chennai and Mumbai for North Karnataka. State plans to develop Greenfield airports at Shimoga, Bijapur, Hassan and Gulbarga through the PPP model as well. The State government has proposed to develop airstrips at district headquarters and important industrial and tourist centres, which lack air connectivity. The State Government is finalising a policy for the development of airports/airstrips. In recent years, work on planning and preparation of terminal 2 and second parallel runway of Kempegowda International Airport was initiated. This construction will enable the airport to handle around 35 million passengers per year. In addition, work on development of Kalaburagi (Gulbarga) airport by PWD is under progress8.

KIA handles 1.5 crore passengers annually. An additional runway and another terminal are under construction, which will increase passenger capacity to over 4.5 crores per annum

Mangaluru handles over seven lakh international and over 10 lakh domestic passengers; more than 15000 flights handled

Belagavi handles nearly one lakh passengers across nearly 1600 flights. The airport had a new terminal building inaugurated in October 2017.

Hubballi handles nearly 25 thousand passengers per year across 650 flights

In September 2017, daily service was started from Mysuru and Vidyanagar

Kalaburagi airport is expected to become operational by 2018.

Unutilized Airports/Airstrips include Ammasandra, Bengaluru (HAL), Bellary, Chikkmagaluru, Gingera (Hosapete), Harihar, Jakkur, Kolar, Koppal, Kushalnagar, Raichur, Shahbad. Yadgiri, and Yalahanka

8 25% of Kalaburagi airport runway work completed, The Hindu, April 2017, http://www.thehindu.com/news/national/karnataka/25-work-on-airport-runway-completed/article17899287.ece, accessed on 18 Nov 2017

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Figure 1 Aircraft Movement Statistics (in ’000) March 2016-April 2017 Source: Airports Authority of India Reports 2017

Figure 2: Passenger Statistics (In ‘000) March 2016-April 2017 Source: Airports Authority of India Reports 2017

Figure 3: Freight Statistics (In ‘000 MT) March 2016-April 2017 Source: Airports Authority of India Reports 2017

398

305

177148 131 124

62 51 29 20

57703

45154

22881 18362 15820 151038955 7405

3882 2651

19.2%

8.4%

20.6% 20.7%24.0% 21.9%

15.6% 14.3%11.8%

15.0%

0.0%0

20000

40000

60000

2016-17

% Change over 2015-16

857782

359 319

152 122 81 77 28 14

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Ports – Along its coastline of almost 300 kms, Karnataka has one major port, the New Mangalore Port, and 11 minor ports, which are under the Ministry of Shipping, GoI, and the State Government, respectively. New Mangalore is the ninth major port in India with the deepest inner harbour on the west coast. The minor ports handled about 1000 Metric Tonnes in 2015-2016. The State Government has proposed to construct docks measuring 1508 meters at Karwar Port for stationing five ships9. Furthermore, work on the development of the second stage of Karwar port has been initiated under the concept of D-BOOST in PPP mode and the bid document issue is under consideration by the state government. Additionally, a detailed project report will be prepared to construct an additional dock measuring 1,508 meters for stationing five ships of 14 meters depth. The Infrastructure Development Department (IDD) has initiated the development of Tadri (Tadadi) seaport at a projected amount of INR 3,800 crore. The Government has initiated development of a newly declared port at Pavinakurve in Uttar Kannada district under PPP Mode to cater to the needs of the interior and North Karnataka. The state government has also assigned 8,000 sq. km of port land at the minor port of Old Mangalore and signed a land lease agreement for construction of dedicated jetty for the use of Lakshadweep administration.

Figure 4: Traffic Handled at Minor Ports in Karnataka (IN MT) Source: Karnataka Public Works, Ports & Inland Water Transport Department, 2017

Figure 5: Cargo handled by New Mangalore Port (in ‘000 tonnes) Source: Karnataka Public Works, Ports & Inland Water Transport Department, 2017

9 Economic Survey of Karnataka 2016-2017.

31350 32941

37036 39365 36566 35590

39940

19549

2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18

295102

319276

349027

457628

516859

315059

183442

306450

377642

190668

610161

502718

655477

835270

707527

2012-13 2013-14 2014-15 2015-16 2016-17

Import Export Total

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Over the last 5 years, minor ports in Karnataka have seen continuous growth in traffic, especially through export-import transactions. Majority of these transactions have been carried out through Karwar Port. Karwar is the only all-weather port while others are riverine anchorage lighterage ports. Karwar is strategically located midway between the ports at Mumbai and Mangalore. To best utilise the potential of its superior infrastructure facilities, it is imperative to attract investments from the private sector and increase the share of Karnataka in the port trade. Karwar port is well connected with the hinterland of Northern and Central Karnataka, comprising the districts of Belgaum, Dharwad, Gadag, Bijapur, Bagalkot, Raichur, Bellary, Hospet, Chitradurga, Shimoga etc., and few districts of South Maharashtra, West of Andhra Pradesh and Southern Goa. NH-17 passes in the close proximity of Karwar Port. Four-lane road is proposed from Mangalore to Goa, which will result in better hinterland connectivity to the Minor ports of the Karnataka State. Regarding railway connectivity, the Konkan Railway passes parallel to the Minor ports of the state. There is a proposal to provide a rail sliding from Konkan Railway at Shirwad to Karwar Port which is about 8 km. Belekeri Port is located at distance of 30 km south of Karwar Port and is an ideal port for the export of Iron ore and Manganese ore and Other Bulk Cargoes. Tadri Port is located near Aghanashini river in Uttara Kannada District. The backwaters of the river Aghanashini provided vast waterfront at this port enhancing the scope to develop this port with modern infrastructural facilities. Konkan Railway line and N.H-17 are passing very close to the port area. NH 63 and proposed Hubli-Ankola Railway line and Honnavar-Tumkur NH 206 are added infrastructural facilities for all-round development of Tadri port. Additionally, vast area is available for development of this port.

To boost port-based development in the state, the government is planning to set up a Karnataka Maritime Board, which will administer, control, regulate and manage the minor ports of the state. The new Minor Port Policy 2014 introduced by the Government encourages the development of port by PPP mode. Further, maritime-related industries would be given priority to be located along Karnataka coast in the field of shipbuilding, ship repairing, dredging, eco-friendly ship breaking and other units like tugs, barges, launches and support crafts etc. Private players are encouraged to develop, operate and maintain port terminals facilities along the Karnataka coast.

Inland Water Transport –

Under the National Waterways Act, 2016, there are 111 inland waterways have been declared as National Waterways (NWs) in addition to the five existing NWs, across 24 States for utilising them as an environmentally friendly and sustainable mode of transport. Out of the 111 NWs, 106 were created in 2016. Out of these Karnataka has seven waterways, which are likely to offer potential public and freight transport options for the state. The Inland Waterways Authority of India will develop the feasible stretches for navigation and shipping while the right to use water and other issues would lie with the state government. The waterways are poised to spur the tourism potential of the state and aid industrial growth.

S No.

National Waterway

Description

1 Ghataprabha River

Barrage near Malali to confluence with river Krishna at Chicksangam

2 Kabini River Kabini Dam to Beeramballi

3 Kali River Kodasalli Dam to confluence of Kali river with Arabian Sea near Sadashivagad bridge

4 Malaprabha River

Jakanuru to confluence with river Krishna at Kudalasangama

5 Manjara River Singur Dam to confluence with river Godavari at Kandakurthi

6 Netravathi River Natravathi Dam, Dharmasthala to confluence with Arabian Sea at Bengre

7 Sharavthi River Honnavar Port sea Mouth to link to highway at Gerusoppa

16

8 Tungabhadra River

Bridge on State Highway 29 near Chikka Jantakal Village to confluence with river Krishna near village Murva Kinda

Table 5: National Waterways in Karnataka 2017 Source: Karnataka Public Works, Ports & Inland Water Transport Department, 2017

S No.

River/Waterway Total Length (Km)

Navigable Length (Km)

Proposed reach for IWT Hinterland (Taluk)

1 Kali 184 29 Kodibagh to Kadra Karwar

2 Sharavati 80 27 Honnavara to Gerusoppa Honnavara

3 Gangolli 48 20 Kundapur port to other places situated on the banks of the group of five rivers

Kundapur

4 Udayavara 37 14 Malpe port to other places situated on the banks of the Udayavara river

Udupi

5 Gurupur 80 20 Mangalore port to other places situated on the banks of river Gurupur

Mangalore

6 Netravathi 96 26 Mangalore port to other places situated on the banks of river Gurupur

Mangalore

7 Kabini - 30 Bidarahalli Hobli Anandagiri to Beeramballi

Mysore

8 Krishna - 25 Backwater of Alamatti Dam Bagalkot

Total 525 191

Table 6: Karnataka waterways Source: Karnataka Public Works, Ports & Inland Water Transport Department, 2017

Seasonality of most of the rivers has posed feasibility challenges for the development of inland water transport as round-the-clock waterways are essential to developing a seamless water transport system in the state. The South Canara region alone has a 15-20 km belt of perennial river. The State has 335 Ferries out of which the Department operates 15 Ferries and 38 Ferries operated by public auction. Taluk, Village and Zilla Panchayat and Taluk Development Boards operate remaining 282 Ferries. These Ferry services are primarily aimed to facilitate rural commuters. During the year 2016-17, a total of 21,71,555 passengers and 2,88,922 different kinds of vehicles have been transported through 15 ferries run by the Department of Ports and Inland Water Transport clocking revenue of INR 81 lakhs.

Urban Transport Infrastructure – Karnataka’s urban areas are often blamed for chaotic traffic, potholes, broken footpaths, overflowing drainage, etc., due to inadequate design and poorly monitored construction. TenderSURE10 roads is a new initiative by BBMP, which aims to provide equitable road-space to all users including good footpaths, bus shelters and continuous lanes. About 15 kms have already been implemented, and another 25 kms are planned under the new initiative. TenderSURE roads can be easily replicated in other urban centres. Buses: The regional and city bus services in Karnataka are provided through approximately 24,000 buses operated by four state road transport undertakings. However, based on World Resources Institute (WRI) India’s conservative estimate of 0.8 buses per 1,000 population,

10 List of roads under development 2014-2015 “Tender sure ”, BBMP. http://bbmp.gov.in/tendersure-roads.

17

the state needs to double its fleet size with provision of 8,000 buses in Bengaluru alone in the next 1-2 years. Metro Rail: Metro Rail in Bengaluru is being implemented in two phases. Namma Metro Phase 1 consists of two metro lines – 42.5 km in total length. Phase 2 consists of four extensions to the existing lines and addition of two new lines totalling 72.095 km in length. The estimated project cost is INR 26,405.14 crore11. Suburban Rail System: The State Government in collaboration with the Railways is implementing a suburban rail project to connect Bengaluru to its suburban towns of Ramanagaram, Channapatna, Tumkur and Doddaballapura. The State Government has allocated INR 345 crores to operationalise 138.5 kms of sub-urban rail system in Bengaluru region as part of Phase 112. Bus Rapid Transit System (BRTS): Karnataka is implementing the first BRTS in the state between Hubballi and Dharwad. A 22.25-km-long corridor is being built at a project cost of INR 692 crores13. Public Bicycle Sharing System (PBS): Mysore has implemented a citywide PBS system “Trin” consisting of 450 cycles and 48 docking stations. The total project cost is INR 20.52 crores over a period of 6 years. The State Government has given in-principle approval for implementation of a PBS system in Bengaluru at an estimated cost of INR 80.18 crores for 6000 bicycles14. Cab-aggregator services: Over the past few years, several cities in Karnataka have been using an alternative form of transport, cab-hailing services, through a mobile app and digital payment options. These services are functional in about seven urban centres in the state.

Snapshot of Infrastructure Projects undertaken by the Government

An assessment of the key projects undertaken in PPP and Traditional Procurement mode during 2002-2017 period across sub-sectors (Roads, Airports, Ports, Railways and Urban Transport) is given below.

11 Economic Survey of Karnataka 2016-2017. 12 Karnataka chugs on with suburban rail, Deccan Chronicle, May 2017, http://www.deccanchronicle.com/nation/current-affairs/020517/karnataka-chugs-on-with-suburban-rail.html, accessed on 18 Nov 2017 13 Economic Survey of Karnataka 2016-2017. 14 Trin Trin : City to get 6000 bicycles, The Hindu, September 2017, http://www.thehindu.com/news/cities/bangalore/trin-trin-city-to-get-6000-bicycles/article19764858.ece, accessed on 25 Nov 2017

18

Figure 6: PPP versus Traditional Procurement – Number of projects and cost Source: List of State-wise Infrastructure Projects, InfrastructureIndia.gov.in, Department of Economic Affairs, Government of India, Nov 2017; KPMG in India Analysis 2017

As is evident from Figure 6, in the last 15 years the focus for the Government of Karnataka has been on Greenfield projects, expansion projects and upgradation projects. While traditional procurement is still the most significant source for infrastructure projects, in Karnataka the PPP model has been adopted with a considerable degree of success. The Government of Karnataka has stated that it wants to attract more private investment in the infrastructure sector through the PPP model, and so far it has been able to achieve that in several projects.

Figure 7: PPP Projects – Type, Number and Cost Assessment Source: List of State-wise Infrastructure Projects, InfrastructureIndia.gov.in, Department of Economic Affairs, Government of India, Nov 2017; KPMG in India Analysis 2017

653

29878

37363

17160

32278887

34849

6988

7

19

60

142

10

13

63

15

0

20

40

60

80

100

120

140

160

0

5000

10000

15000

20000

25000

30000

35000

40000

Enhancement Expansion Greenfield Upgradation

Traditional Procurment Total Cost in INR Cr PPP Total Cost in INR Cr

Traditional Procurment No. of projects PPP No. of projects

51 1 3

12

1

56

3 2 2

15

Roads & Bridges Urban PublicTransport

Airports Railways Ports (excludingcaptive)

Enhancement Expansion Greenfield Upgradation/Improvement

42259 Cr

413 Cr

5353 Cr

323 Cr

4215 Cr

19

Diving deeper into PPP projects in Figure 7, we take a sector-wise look into the type, number and cost of each project type. As stated earlier, it is clear to see that the most prominent investments in transport infrastructure have been road projects. Due to well-established PPP contract models like BOT and DBFOT, it is more feasible for private players to recoup their investment on roads and bridges and hence it attracts the maximum amount of funding. Urban public transport is still a relatively new focus sector, and the number of projects under it will only increase in the coming years as urbanisation also increases.

BIAL is the first and one of the most successful Greenfield PPP ventures in the country and has become a model project that other states aspire to emulate. Its success has also significantly strengthened the brand of Karnataka as an investment destination and with a large number of airport projects planned, and in the pipeline, the investments in this sector will continue to rise.

Karnataka has limited port infrastructure as of now, but with the proposed industrial corridors, two new ports are coming up as along with the expansion of the New Mangalore port being in the pipeline. It is one of the sectors where projects are being undertaken with both PPP and traditional procurement models.

Figure 8: Traditional Procurement Projects – Type, Number and Cost Assessment Source: List of State-wise Infrastructure Projects, InfrastructureIndia.gov.in, Department of Economic Affairs, Government of India, Nov 2017; KPMG in India Analysis 2017

The success of the PPP model does not necessarily mean that the traditional procurement model can be done away with. As is evident, for many types of projects, it is unfeasible to pursue the PPP model. Also, it can be the case that building certain types of infrastructure is critical and it requires the government to proactively step-in and complete the project rather than spend time trying to develop suitable partnership models. As can be seen in Figure 8Figure 8, this is especially applicable to railways. It has been previously highlighted that railway connectivity in the state of Karnataka has been quite weak, and with limited options to recoup investments, it has not been a lucrative sector for private investments. However, in a mostly land-locked state like Karnataka, railways are extremely important for freight transportation, and hence the Government has followed a traditional procurement model for railways projects.

4 2 1

14

1 1 1 2

19

5 2

30

4

142

Roads & Bridges Urban PublicTransport

Airports Railways Ports (excludingcaptive)

Enhancement Expansion Greenfield Upgradation/Improvement

24135 Cr

1925 Cr

14476 Cr

4003 Cr

20

Another type of project that has not achieved much success as of now under the PPP model is the upgradation and improvement of existing roads and bridges. As with railway projects, it is difficult for private investors to get a good return on their investment for such projects. However, not having an appropriate road infrastructure can become a painful bottleneck. The Government of Karnataka has to step in and ensure that roadworks are carried out, even if it means going with the traditional procurement model. As a success story for traditional procurement model of project execution, a note must be made of the Konkan Railways project – one of the most challenging feats of engineering undertaken in the country to date. Building the railway line was critical for the development of the coastal regions of Karnataka, but it would not have been financially feasible for any private investor. Hence, the onus fell on the Government of Karnataka to step up and ensure the completion of the project, and it did so with great success. Thus, it is evident that while the PPP model can be successfully adopted for several projects, notably Greenfield and Enhancement projects, traditional procurement model is still vital for several infrastructure projects and a balanced mix of the two can ensure that all of Karnataka’s infrastructure needs are addressed.

21

1.2. District-level Infrastructure Connectedness Assessment

Sl. No.

District Area in sq km

Population

(2011 census

)

Projected

Population

(2017)

Road Length (km) Railways Airport Port

NH

NH Density (km per lakh population)

NH length per 1000 sq km area

SH

SH Density (km per lakh population)

SH length per 1000 sq km area

MDR

MDR Density (km per lakh population)

MDR length per 1000 sq km area

Route length (km)

Rail Density (km per lakh population)

Rail length per 1000 sq km area

No. of railway stations

No. of active Airports in district

No. of international airports accessible

No. of domestic airports accessible

No. of Sea Ports

No. of major ports accessible

1 Bagalkot 6552 18897

52 210325

3 166.

91 3.49

25.47

857.03

17.93 130.

8 1609.

32 76.52

245.62

77 4 12 0 3 2 0 4

2 Belagavi 1343

3 47796

61 531965

9 201 8.2

14.96

2554.31

104.15 190.

15 3099.

46 58.26

230.73

0 0 1 4 2 0 3

3 Bellary 8461 24525

95 272968

5 394.

73 39.83

46.65

929.92

93.84 109.

91 1805.

59 66.15

213.4

310 11 37 13 1 3 2 0 4

4 Bengaluru Rural

2298 99092

3 110287

6 205 2.13

89.21

212.83

2.21 92.6

2 669.1 60.67

291.17

204 19 89 18 0 3 4 0 3

5 Bengaluru Urban

2196 96215

51 107085

77 147 8.63

66.94

116.7 6.85 53.1

4 722.9

4 6.75

329.21

148 1 68 20 1 3 4 0 4

6 Bidar 5448 17033

00 189573

6 209.

81 20.55

38.51

597.62

58.54 109.

7 877.0

8 46.27

160.99

119 6 22 5 0 2 3 0 4

7 Chamarajanagar

5648 10207

91 113611

8 201.

24 16.03

35.63

346.76

27.63 61.4 992.5

6 87.36

175.74

20 2 4 3 0 3 3 0 5

8 Chikballapur 4244 12551

04 139690

3 148 13.01

34.87

263.88

23.19 62.1

8 993.3

4 71.11

234.06

90 6 21 8 0 3 2 0 4

9 Chikkmagaluru

7202 11379

61 126652

6 267.

61 16.13

37.16

535.71

32.28 74.3

8 1632.

82 128.92

226.72

95 8 13 9 0 1 3 0 4

10 Chitradurga 8436 16594

56 184693

8 286.

7 13.72

33.99

459.36

21.98 54.4

5 1694.

91 91.77

200.91

165 9 20 17 0 1 3 0 3

11 Dakshin Kannada

4861 20896

49 232573

4 310.

4 15.95

63.86

455.8 23.43 93.7

7 775.1

5 33.33

159.46

227 10 47 15 1 3 1 4 6

12 Davanagere 5924 19454

97 216529

6 187.

42 10.15

31.64

765.59

41.45 129.

24 1611.

6 74.43

272.05

89 4 15 7 0 4 2 0 3

13 Dharwad 4260 18470

23 205569

6 191.

9 18.03

45.05

510.09

47.92 119.

74 1406.

71 68.43

330.21

218 11 51 14 1 3 2 0 3

14 Gadag 4657 10645

70 118484

3 103.

57 5.83

22.24

750.05

42.22 161.

06 1184.

19 99.94

254.28

96 8 21 10 0 2 2 0 3

15 Hassan 6814 17764

21 197711

8 252.

16 15.78

37.01

1036.25

64.86 152.

08 3131.

35 158.38

459.55

0 0 0 2 3 0 3

22

Sl. No.

District Area in sq km

Population

(2011 census

)

Projected

Population

(2017)

Road Length (km) Railways Airport Port

NH

NH Density (km per lakh population)

NH length per 1000 sq km area

SH

SH Density (km per lakh population)

SH length per 1000 sq km area

MDR

MDR Density (km per lakh population)

MDR length per 1000 sq km area

Route length (km)

Rail Density (km per lakh population)

Rail length per 1000 sq km area

No. of railway stations

No. of active Airports in district

No. of international airports accessible

No. of domestic airports accessible

No. of Sea Ports

No. of major ports accessible

16 Haveri 4823 15976

68 177817

0 157.

9 6.15

32.74

576.14

22.45 119.

46 1867.

5 105.02

387.21

86 5 18 10 0 3 2 0 3

17 Kalaburagi 1095

4 25663

26 285626

5 279.

14 50.34

25.48

1370.66

247.18 125.

13 1213.

57 42.49

110.79

167 6 15 17 0 3 3 0 3

18 Kodagu 4102 55451

9 617168

62.19

4.05 15.1

6 476.3

1 31

116.12

846.5 137.16 206.

36 0 0 0 0 3 2 0 4

19 Kolar 3979 15364

01 170998

1 137.

4 9.89

34.53

305.52

21.98 76.7

8 1222.

47 71.49

307.23

117 7 29 11 0 3 3 0 3

20 Koppal 5570 13899

20 154695

1 162.

69 9.01

29.21

673.18

37.28 120.

86 1445.

27 93.43

259.47

52 3 9 3 0 4 2 0 4

21 Mandya 4962 18057

69 200978

2 206.

21 6.87

41.56

352.71

11.75 71.0

8 2863.

27 142.47

577.04

97 5 20 20 0 3 2 0 4

22 Mysuru 6307 30011

27 334018

9 237.

63 12.32

37.68

591.68

30.68 93.8

1 2603.

09 77.93

412.73

120 4 19 15 1 1 2 0 1

23 Raichur 8442 19288

12 214672

6 163 15.06

19.31

850.52

78.56 100.

75 1506.

81 70.19

178.49

0 0 0 3 2 0 4

24 Ramanagara 3516 10826

36 120495

0 93 5.31

26.45

273.57

15.61 77.8

1 1548.

45 128.51

440.4

44 4 13 6 0 3 2 0 4

25 Shivamogga 8478 17527

53 195077

6 398.

1 14.86

46.96

880.25

32.86 103.

83 2171.

83 111.33

256.17

131 7 15 11 0 3 2 0 4

26 Tumakuru 1059

7 26789

80 298164

6 390.

45 33.16

36.85

687.38

58.38 64.8

7 3771.

95 126.51

355.95

97 3 9 16 0 2 2 0 4

27 Udupi 3582 11773

61 131037

7 218.

4 15.2

60.97

260.31

18.11 72.6

7 791.8

8 60.43

221.07

100 8 28 5 0 1 5 0 7

28 Uttara Kannada

10277

1437169

1599538

359.32

16.5 34.9

6 1235.

71 56.75

120.24

2045.16

127.86 199 176 11 17 18 0 3 2 6 9

29 Vijayapura 1049

8 21773

31 242332

2 297.

07 25.3 28.3

763.28

65 72.7

1 2430.

47 100.29

231.52

128 5 12 18 0 3 2 0 2

30 Yadgir 5270 11742

71 130693

8 136.

2 10.42

25.84

455.73

34.87 86.4

8 1205.

83 92.26

228.81

58 4 11 3 0 1 2 0 1

Table 7 District Connectivity Assessment Source: KPMG Analysis 2017 based on market research and assumption made from multiple sources

23

1.3. Sector Benchmark with other states in the country with good practices to emulate

The Infrastructure sector is a key driver for the Indian economy. The sector is highly responsible for propelling Karnataka’s overall development and enjoys intense focus from Government for initiating policies that would ensure the time-bound creation of world-class infrastructure in the state. The state of Karnataka with a geographical area of 1.92 lakh square km is the 7th largest state in India with good road and railway connectivity to other parts of the country. The below table compares the road, rail and air connectivity infrastructure of major Indian states:

Particular Karnataka Kerala Gujarat

Tamil Nadu Units

Geographical Area 192000 38863 196063 130058

Sq.Km

Roads

Road density 5269

State Highways 27,163 1,812 19,761 10,764 Kms

National Highways 6,502 4,342 4,971 4,943 Kms

Major District Roads 55,515 27,470 20,641 22,509 Kms

Municipal roads 8,366 NA 53,288 8,926 Kms

Other Roads 155,545 NA 10,493 144,583 Kms

Village Roads NA NA 21,119 NA Kms

Airports

Number of airports 5 3 18 7 No's

Railways

Railway Length 3281 1045 5259 4027 Kms

Ports

Ports(Major + Minor) 1+12 1+17 1+41 3+23 No's

Total Major Port Traffic Handled15

19.5 25 105.4 118.7 MT

Table 8: Comparative assessment of Infrastructure – State-wise Source: State-wise Length of Railway Lines and Survey for New Railway Lines, PIB, Dec 2016

As can be seen in Table 2, while Karnataka has good infrastructure coverage wise when it comes to roadways, however, it lags behind the top states with respect to rail and port infrastructure. The road connectivity, especially coverage in rural areas, means that the interior locations of the state are accessible for providing goods and services. However, the quality of the roads – their load-bearing capacity, weather worthiness, and cost of upkeep – as well as their interconnectivity and the availability of transport facilities are all factors that need to be looked at beyond merely the coverage. This will help get a better

15 About Karnataka: Information On Tourism Industry, Exports, Economy & Geography, IBEF, Nov 2017, https://www.ibef.org/states/karnataka.aspx, accessed on 1 Dec 2017

24

understanding of how the road infrastructure creates opportunities for the state as well as broader issues that need addressing.

Karnataka has the lowest rail route density and broad gauge density among the states under consideration. This fact, unfortunately, means not only that there is increased pressure on the state’s roadways due to higher freight traffic, but also that often hazardous goods may end up passing near populated areas. Development of the railway infrastructure in the state is a significant opportunity. However, the high capital costs and low returns on investment means that the State and Central Governments need to join hands to build this infrastructure. In the coming years, Bengaluru will be at the nexus of two major economic corridors. Additionally, there is increased investment in manufacturing industries across the state. Both these measures will fail to achieve their potential unless better freight corridors are built. The upcoming petrochemical corridor would also greatly benefit from better rail infrastructure, plus it will help keep dangerous chemicals away from populated areas and highways.

While Karnataka has only five operational airports, it is possible to operationalise currently unserved airports quickly. With efforts to open defence airports to public use and the UDAN scheme of the Central Government, it is likely that in the next few years, air connectivity across the state will grow by leaps and bounds with as many as six new airports becoming operational. Gujrat is an excellent model to emulate and shows the benefits air connectivity brings to the economy of the state. It connects not only urban centres but also industrial ones, allowing better flow of investments, executives, and goods – all crucial factors in strengthening development across the state.

Karnataka has only one major port – New Mangalore. However, under the upcoming industrial corridor projects as well as the Sagarmala scheme of the Central Government, it will soon have better port connectivity. Despite its large geographical area, Karnataka is limited by its relatively limited coastline with limited opportunities for setting up ports and Kerala being a preferred destination on the Arabian Sea. It also lacks connectivity options on the eastern coast of India, but infrastructure projects in the pipeline should address this issue. Port connectivity is critical for trade as it is the most efficient means of transporting large volumes of goods and can become a bottleneck for trade if underdeveloped. With the importance of aerospace, petrochemical, and engineering industries in the state, developing better port connectivity is critical for Karnataka to remain competitive and attract more significant investments.

Thus, one can see that while Karnataka has good infrastructure, but when compared to the best in the country there is still some ways to go. Identifying and addressing issues will be critical to ensuring that infrastructure does not become a bottleneck for growth and competitiveness. Taking advantage of the opportunities and enhancing the infrastructure will mean that the state can continue being successful and will be able to attract more prominent and better investments and projects for the socio-economic benefit of its people.

1.4. Global Benchmarks by sector

The road density of Karnataka is 131.8 km of road per 100 Sq. km of land area as compared to Monaco (3850), Malta (704.7), Belgium (498.7), Bahrain (493) and Singapore (471.68) which have the highest road densities in the world.

In regards to railways, the state has a railway network of 3,250 km (consisting of broad gauge, meter gauge and narrow gauge). Karnataka has the lowest rail route and broad gauge densities as compared to the other Southern States - rail density in the State is 16.60 km per 1000 km.

25

Christmas Island (12.84 km), Australia (1.8 km), Canada (1.41 km), Sweden (1.29 km) and Namibia (1.26 km) have the highest total route length of railway network per capita (per 1000 population) whereas Karnataka is at 0.057 km.

Karnataka has 12 ports, of which New Mangalore is the only major port. The cargo handled in 2016-17 by minor & major ports in ‘000 MT was 25766.08. Port container traffic measures the flow of containers from land to sea transport modes, and vice versa, in twenty-foot equivalent units (TEUs), a standard-size container. Singapore (5436.78 TEU), The Bahamas (3681.39 TEU), Malta (3423.19 TEU), United Arab Emirates (2373.15 TEU), Oman (1081.28) have the highest container port traffic per 1000 population. With Karnataka handling 0.4 % of the Indian total (4.38 TEU).

The state has five domestic airports located in Bengaluru, Mangalore, Hubli, Mysore and Belgaum. International flights operate from two of the airports - Bengaluru (Kempegowda International Airport) and Mangalore (Mangalore International Airport). At the global level, Brazil (21.35), Russia (8.91), China (0.375), South Africa (11.56) have the highest total number of airports per capita (per 1 million population). In India (0.306), Karnataka handles a very small fraction.

1.1. Future state of affairs for the sector in India and Globally

The start of the last decade has witnessed increased investments in the infrastructure sector, accompanied by a transformation in the business models with more proactive participation from the private sector in the form of Public-Private-Partnership (PPP) projects. However, the progress of infrastructure development has not been smooth in the recent years, with significant shortfalls in planned investments. This problem is compounded by the fact that many of the announced projects are yet to be completed, with large time and cost overruns.

Some of the key issues plaguing the sector are:

1. Land acquisition and environmental clearance

2. Lack of coordination between various Government agencies

3. Inappropriate structuring of the projects, particularly of demarcation of risks and rewards between Government and private sector

4. Lack of a proper dispute resolution mechanism between private players and government agencies

2. Debt burden of infrastructure developers, as a consequence of execution delays and irrational bidding

Some firms have had their debt recast by corporate debt restructuring cell, with some firms resorting to the sale of BOT assets to reduce their debt burden, post award of the project.

The proposed investment over the next five years, with nearly half expected to come from private players, sectors like road and power are expected to attract a large share of the proposed investments, and newer opportunities are likely to appear over the next few years. Opportunities are also expected to arise in the area of urban infrastructure development, such as large urban transport and water supply projects in urban cities, driven by the rapid pace of urbanisation.

India’s national highway network is expected to cover 75,000 kilometres by 2025, with around 30,000 km of works scheduled for completion in the next couple of years, according to the Ministry of Road Transport and Highways. The Government of India is devising a plan to provide Wi-Fi facility to 550,000 villages by March 2025 for an estimated

26

cost of INR 3,700 crore (USD 577.88 million), as per the Department of Telecommunications, Government of India.

India and Japan have joined hands for infrastructure development in India's north-eastern states and are also setting up an India-Japan Coordination Forum for Development of North East to undertake strategic infrastructure projects in the northeast. Sweden is interested in smart cities development in India and has put forward a Common Plan of Action for developing sustainable and environment-friendly public transport solutions and solid waste management for the smart cities under development.

The Ambassador of Japan to India has conveyed Government of Japan's inclination to invest and offer any other feasible support for various ongoing as well as upcoming development and infrastructure projects in the North-Eastern region of India.

Cumulative FDI inflows in the Construction Activities sector, which includes infrastructure, reached USD 10.26 billion between April 2000 and June 2017. The UAE-based firm, DP World, having previously invested USD 1 billion in India, is planning to invest another USD 1 billion in India's infrastructure sector along with logistics and container terminals. Squared Capital, a global infrastructure investment company, plans to raise up to USD 4 billion through its second infrastructure fund, which will be invested in infrastructure assets in India.

An outlay of INR 6.92 trillion (USD 107.64 billion) was approved by the Government of India in October 2017 to build a road network of 83,677 km over the next five years. The outlay includes the Bharatmala projects worth INR 5.35 trillion. The Ministry of Railways is working on a plan to earn INR 15,000 crore (USD 1.56 billion) over the next 10-20 years through a rail display network (RDN), enabling real-time information to passengers. Railways started a new segment of revenue generation channel through auctioning for advertising and branding contracts on 1000 trains. The front running brands are to sign this contract for five years. The AAI aims to bring around 250 airports under operation across the country by 2020. AAI plans to develop city-side infrastructure at 13 regional airports across India, with help from private players for the building of hotels, car parks and other facilities, and thereby boost its non-aeronautical revenues.

As for Karnataka, in May 2017, the state government revealed its plans for widening and redeveloping four roads on the city outskirts to bring down traffic congestion. The Karnataka Road Development Corporation Ltd. has estimated the cost for improving 155Km of roads at USD216.42 million.

Thus, while many systemic issues need to be addressed for the success of infrastructure, investor confidence is high and the current business climate is seen as favourable for infrastructure investments. The Government of India, Government of Karnataka, and various foreign parties all believe in the significant opportunity that lies in this sector and the former two are prioritizing infrastructure work as it is not only an enabler but in fact a key requirement for any other sectors to work well.

1.2. Institutional Framework

S No. Institution Primary Objective

1 National Institution for Transforming India (NITI Aayog)

Providing both directional and policy inputs, designing strategic and long-term policies and programmes for the Government of India

2 Infrastructure Development Department (IDD)

Developing air, rail, and maritime connectivity for the state and in promoting increased private investment

27

S No. Institution Primary Objective

in public infrastructure through Public Private Partnership

3 Infrastructure Development Corporation (Karnataka) Ltd (iDeCK)

Work closely with government departments and agencies as well as private sector clients across the globe for development of infrastructure in transportation, tourism, urban development, industries, and renewable energy

4 Karnataka State Industrial & Infrastructure Development Corporation Limited (KSIIDC)

To plan and formulate proposals for industrial infrastructure development projects after assessing needs in different sectors/areas and monitor implementation of mega projects as the nodal agencies

5 Karnataka State Financial Corporation (KSFC)

A lending institution in most districts for entrepreneurs largely in small-scale sector, tiny units and disadvantaged groups.

6 Ministry of Road Transport & Highways (MoRTH)

Formulating and administering, policies for Road Transport, National Highways and Transport Research with a view to increasing the mobility and efficiency of the Road Transport system in the country.

7 National Highways Authority of India (NHAI)

Responsible for the development, maintenance and management of National Highways entrusted to it and for matters connected or incidental thereto.

8 Karnataka Public Works, Ports, & Inland Water Transport Department (PWP&IWTD)

Responsible for roadworks including maintenance on National Highways, State Highways and Major District Roads and construction & maintenance of Government Buildings. It also undertakes construction on behalf of another department under the Deposit Contribution Works

9 Karnataka Road Development Corporation Limited (KRDCL)

Promote surface infrastructure and improve road network by taking up construction, widening, strengthening of roads, construction of bridges, maintenance of roads etc.

10 Karnataka State Highways Traffic and Transport Authority (KSHTTA)

Undertake the planning and regulatory functions in the road sector.

11 Planning and Road Asset Management Centre (PRAMC)

Primary functions include Policy Development and Planning, Programming, Road safety, Information Technology support across the whole of PWD and Training support across whole of PWD

12 Karnataka State Highways Improvement Project (KSHIP)

The improvement of the road network of the state with assistance from the World Bank (WB) and Asian Development Bank (ADB).

13 Karnataka Rural Road Development Agency (KRRDA)

To create basic infrastructure in rural areas to make them self-reliable and self-sufficient by 2020. KRRDA aims to create qualitative and sustainable rural infrastructures within a time-bound manner for the money invested.

14 Karnataka State Road Transportation

To provide efficient, adequate, economical, and well-coordinated transport services to commuters.

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S No. Institution Primary Objective

Corporation (KSRTC)

15 Indian Railway Stations Development Corporation Limited (IRSDC)

To be a leading organisation in the field of development, redevelopment, operation and maintenance of railway stations with passenger amenities of international standards16.

16 South Western Railway (SWR)

Protect and safeguard railway passengers, passenger area and railway property. Ensure the safety, security and boost the confidence of the travelling public on the Indian Railways.

17 Karnataka Rail Infrastructure Development Corporation Ltd. (K-RIDE)

Developing and implementing rail infrastructure projects in Karnataka with a private sector participation wherever found feasible/viable.

18 Dedicated Freight Corridor Corporation of India (DFCCIL)

Undertake planning and development, mobilisation of financial resources, and construction, maintenance and operation of the Dedicated Freight Corridors.

19 Container Corporation of India Ltd. (CONCOR)

To provide inland transport by rail for containers, management of Ports, air cargo complexes and establishing cold-chain.

20 Bangalore International Airport Limited (BIAL)

To carry out the development, design, financing, construction, operation, and management of the Kempegowda International Airport, Bengaluru (‘KIAB’) airport.

21 Directorate of Urban Land Transport (DULT)

To oversee all the urban land transport initiatives in Urban/Local Planning areas of Karnataka.

22 New Mangalore Port Trust (NMPT)

To provide safe and cost-effective services related to Seaport facilities at NMPT, meeting applicable Statutory and Regulatory requirements.

23 Karnataka Maritime Board (KMB)

In accordance with Karnataka Maritime Bill 2011, the Government of Karnataka has initiated a process to formulate the Karnataka Maritime Board as an overarching institution to cater to the long-term development of ports in the state.

Table 9 List of important National and Institutions for Infrastructure Development in Karnataka Source: KPMG in India Analysis 2017 based on market research

From this list, one can see that there are several Government departments, agencies and undertakings that working in the transport infrastructure sector. It is worth noting that for each sector, multiple bodies could be responsible for works. Hence, there are many interdependencies that need to be managed, and a lack of coordination between departments can become a bottleneck in the creation of robust infrastructure. However, seeing the breadth of coverage for different infrastructure tasks, any investor or entrepreneur can be assured that for infrastructure projects they will find the financing and support that they require to complete their assignments successfully.

16 Annual report 2015-16, IRSDC, https://www.irsdc.com/annual_report/Annual%20Report%202015-16.pdf, accessed on 10 Nov 2017

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1.3. Policy and Regulatory Framework

This section provides a brief description of policies and regulatory tools governing urban planning and various urban infrastructure and service delivery sectors in Karnataka.

Policies Infrastructure Policy 2015: The Infrastructure Policy has been formulated to provide a fair and transparent policy framework for facilitating economic growth and encouraging PPP in infrastructure development. Metro Rail Policy (National): The metro rail policy emphasises that urban

mass transit projects should be seen as urban transformation projects. It

mandates (1) Public-private partnership (PPP) for availing central

assistance; (2) Transit Oriented Development (TOD) to promote compact

and dense urban development; and (3) last-mile connectivity provision in

catchment areas of 5 kms radii around stations.

National Urban Transport Policy (2014) The objective of this policy is to plan for the movement of people rather than vehicles by providing sustainable mobility and accessibility to all citizens to jobs, education, social services and recreation at an affordable cost and within a reasonable time. This will involve:

Incorporating urban transportation as an important parameter at the urban planning stage

Bringing about a more equitable allocation of road space

Public Transport should be citywide, safe, seamless, user-friendly, reliable

Walking and cycling should become safe modes of Urban Transport.

Introducing Intelligent Transport Systems for traffic management

Addressing concerns about road safety and trauma response

Raising finances, through innovative mechanisms

Establishing institutional mechanisms for enhanced coordination

Building capacity (institutional and workforce) to plan for sustainable

urban transport

Electric Vehicle and Energy Storage Policy 2017: The Government of

Karnataka has approved the “Electric Vehicle and Energy Storage Policy”

and plans to set up Electric Vehicle (EV) manufacturing zones and charging

stations to make the State a hub for alternative fuels. It is estimated that the

policy will attract investments worth INR 31,000 crores and provide

employment to 55,000 people17.

Karnataka Minor Port Policy-2014: Through the “Karnataka Minor Port

Policy-2014”, the State government is developing minor ports under the

PPP mode.

Aerospace Policy 2013: The Aerospace policy was adopted to enable an environment of holistic and sustained growth of the aerospace sector and to position Karnataka as a globally recognised aerospace destination. Additionally, the policy aims to increase the contribution of the aerospace

17 Karnataka Cabinet Clears E-Vehicle Policy, The Economic Times, September 2017, https://economictimes.indiatimes.com/industry/auto/news/industry/karnataka-cabinet-clears-e-vehicle-policy/articleshow/60508773.cms, accessed on 10 Nov 2017 .

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sector towards enhancing the share of industry in the State’s GSDP from 28 percent to 32 percent by 2022.

Karnataka Tourism Policy 2015-2020: The policy aims at increasing the contribution of the tourism sector to the Karnataka’s GDP. It also seeks to put in place an integrated approach for the development of a sustainable tourism industry that is backed by relevant infrastructure, effective institutional mechanisms and an enhanced capacity to deliver on these targets18. Investment subsidies have been added to encourage participation of private sector and local entrepreneurs in the development of tourism infrastructure and products.

Acts & Rules

Motor Vehicles Act 1988, Central Motor Vehicles Rules, 1989 and The Karnataka Motor Vehicles Rules,1989

The Motor Vehicle Act (MVA) 1988, Central Motor Vehicle Rules,

1989 and The Karnataka Motor Vehicle Rules, 1989 are the legal

instruments for the conduct of road traffic in Karnataka. The Motor Vehicles

Act, 1988 grants powers to the states within some subjects to make their

own rules which are as follows- Licensing of Driver of Motor Vehicles,

Licensing of conductors of stage carriages, registration of motor vehicles,

control of transport vehicles, Special provisions pertaining to State

Transport Undertakings (BMTC, KSRTC, NEKRTC & NWKRTC)

The Karnataka on-demand Transportation Technology Aggregators

Rules, 2016: The State government had introduced the new rules for

ensuring the safety of passengers who use taxi services through On-

Demand Transport Technology platforms. These new rules require cab

aggregators to obtain a license under the newly formulated rules.

Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement (RFCTLARR) Act, 2013: Most of the State agencies such as Revenue Department, Karnataka State Housing Board, Karnataka Slum Areas Development Board and Karnataka Road Development Corporation, Karnataka Industrial Area Development Board use this Act with amendments to acquire land for various public purposes.

Karnataka Maritime Board Act 2015: The Bill among other things provides for (1) constitution and functioning of the Maritime Board for Karnataka. The Board shall be in a position to find ways and means to undertake various developmental projects and maintenance activities in relation to ports, harbours, inland waterways and coastal protection and thus help in the growth and development of the coastal region and its hinterland. (2) Developing all Karnataka ports on public-private partnership Basis. (3) Development and maintenance of fishing harbours by the Board with suitable budgetary grants and subventions from the Government. However, the operations and management of the fishing harbours shall continue to be done by the Fisheries Department and not by the Maritime

Board19

The Karnataka Transparency in Public Procurement Act, 1999 and The Karnataka Transparency in Public Procurement Rules 2000 (KTPP Act

18 Aim to provide quality tourism, Frontline, September 18 2015, http://www.frontline.in/other/travel/aim-to-provide-quality-tourism/article7603470.ece, accessed on 10 Nov 2017 19 The Karnataka Maritime Board Act 2015, http://dpal.kar.nic.in/ao2017/41%20of%202017%20(E).pdf, accessed on 12 Nov 2017

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& Rules): An Act to provide for ensuring transparency in public procurement of goods and services by streamlining the procedure in inviting, processing and acceptance of tenders by Procurement Entities, and for matters related thereto20. Public procurement means obtaining of goods and services, execution of works, or consultancy services. After the Act & Rules came into effect in October 2000, procurement other than by tender is prohibited, and procurement entities are to follow the procedure as laid down in the Act & Rules. For Tenders exceeding INR 50 lakhs in value, where prequalification are not followed, a two cover system shall be adopted, with the first cover being a Technical bid and the Second cover a Finance bid.

Table 10: Policy and Regulatory Landscape for Infrastructure and Service Delivery in Karnataka

1.4. Government Programs and Schemes

Infra sub-sector

Program Description Coverage

Overall

Invest Karnataka

Invest Karnataka is a biennial meet that aims to create a platform for the best minds to meet, exchange ideas and drive forward the state's vision of prosperity for all - by employing technology, innovation, inclusivity and sustainability as key factors for development. The last Invest Karnataka took place from 3rd-5th Feb 2016.

State

Roads

National Highways Development Project (NHDP)

The program aims to upgrade, rehabilitate, and widen major highways in India to a higher standard.

National

Roads

Bharatmala Pariyojana

Bharatmala is a centrally-funded roads and highways project of the Government of India that will subsume all existing highway projects including those under NHDP. The Bharatmala project addresses critical infrastructure gaps and focuses on optimizing the efficiency of the movement of goods and people across the country.

National

Roads and

Railways

Logistic Efficiency Enhancement Programme (LEEP) 21

LEEP is a program under NHAI as a part of Bharatmala Pariyojana aimed to enhance the freight transportation in India through improving cost, time, tracking and transferability of consignments through infrastructure, procedural and Information Technology (IT) interventions,

National

State Highway Development Project (SHDP)

Based on the approval accorded by the state cabinet in May 2011, an empowered committee has proposed

State

20 The Karnataka Transparency in Public Procurement Act, 1999, http://www.finance.kar.nic.in/trans/Trans-Act.pdf, accessed on 12 Nov 2017 21 NHAI initiates DPRS for Logistic Efficiency Enhancement Programme (LEEP) under Bharatmala Pariyojna, Press Information Bureau, Government of India , Ministry of Road Transport and Highways, November 2016, http://pib.nic.in/newsite/PrintRelease.aspx?relid=153623, accessed on 10 Nov 2017

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Infra sub-sector

Program Description Coverage

improvements to 7254 km of core road network in the state by the PWD at an estimated cost of INR 2797 crore. Additional improvements to state highways are being carried out by KSHIP and KRDCL.

Pradhan Mantri Gram Sadak Yojna (PMGSY)

PMGSY was launched by the Government of India to provide connectivity to unconnected habitations as part of a poverty reduction strategy

National

Roads and

Railways

Setu Bharatam

The Setu Bharatam project was launched in 2016 with an aim to make all National Highways free of railways level crossings by 2019 and to strengthen/overhaul about 1500 old and worn-out bridges on National Highways.

National

Railways

Diamond Quadrilateral

The Diamond Quadrilateral is a project of the Indian Railways to establish a high-speed rail network in India. The quadrilateral will connect the four metro cities of India and pass through 14 states and territories of India.

National

Ports

Sagarmala Programme

Under the Sagarmala programme, projects will be undertaken for port modernization and new port development, port connectivity enhancement, port-linked industrialization, and coastal community development for phase-wise implementation over the period 2015 to 203522.

National

Airports

UDAN (Ude Desh ka Aam Naagrik) Scheme

UDAN is a Regional Connectivity Scheme23 (RCS) of the Government of India seeking to boost air connections in India by linking up hundreds of unserved and underserved airports in Tier 2 and Tier 3 with major cities and with each other.

National

Airports

Karnataka Aerospace Policy 2013 – 202324

The Karnataka Aerospace Policy 2013-2023 aims to make the state a favourable destination for maintenance, repair, and overhaul (MRO) investments.

State

Industrial Corridors

Bengaluru-Mumbai Economic Corridor (BMEC) National

22 Sagarmala Programme, Press Information Bureau, Government of India , Ministry of shipping , March 2017 http://pib.nic.in/newsite/PrintRelease.aspx?relid=159037, accessed on 10 Nov 2017 23 Regional Connectivity Scheme UDAN, Ministry of Civil Aviation, Government of India, October 2016, http://www.civilaviation.gov.in/sites/default/files/Final%20Regional%20Connectivity%20Scheme%20%28RCS%29.pdf, accessed on 12 Nov 2017 24 Karnataka Aerospace Policy 2013-2023( With Amendments), Commerce and Industries department, http://www.investkarnataka.co.in/assets/downloads/aerospace-policy.pdf, accessed on 12 Nov 2017

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Infra sub-sector

Program Description Coverage

BMEC connects the IT capital of the country to the financial capital. Creation of this corridor will ease the load on Bengaluru and help rapid development of the industry in the northern parts of Karnataka. The UK Trade and Investment (UKTI) is the nodal agency on the side of the UK who expressed interest in cooperation for the development of the corridor in 201325.

Inter-state

corridors

Chennai-Bengaluru Industrial Corridor (CBIC)

CBIC will cover the states of Karnataka, Tamil Nadu, and Andhra Pradesh and provides world-class connectivity to Chennai, an important port on the Bay of Bengal. The project has been under planning since in partnership with the Japan International Cooperation Agency (JICA) since 201126.

National

Inter-state

corridors

Kochi Bengaluru Industrial Corridor (KBIC)

KBIC will pass through Palakkad and Coimbatore in Kerala to link with the Bangalore Chennai industrial corridor. Presently, the Kerala State Industrial Development Corporation Limited (KSIDC) is in the process of selecting consultants for planning for identified integrated manufacturing cluster (IMC) sites for the corridor region.

National

Intra-state

corridors

Naidupeta – Mulbagal Road Upgradation

Mulbagal in Kolar district of Karnataka is considered the eastern gate of Karnataka and is emerging as a key hub, making this an important road connectivity project.

State

Mass Transit

Bangalore-Chennai Hyperloop National

Urban Transport

Revised Master Plan (RMP) 2031 (Draft)27

The draft master plan for Bengaluru has been created by the Bengaluru Development Authority (BDA) to document how the city will develop and function for the next 15 years

City-wide

Table 11 List of Key Programs and Schemes by the Government of Karnataka and Government of Karnataka for Infrastructure Development

Infrastructure is a focus sector for both the Central and State Governments, and this fact is evident in the number of programmes currently underway across the country. With the forward-looking nature of these policies and improvements planned across every subsector of transport infrastructure, the future of Karnataka is very bright, and it shall continue being an attractive destination for investors and entrepreneurs.

25 BMEC: Brief about the Scheme, Department of Industrial Policy and Promotion, http://dipp.nic.in/programmes-and-schemes/bengaluru-mumbai-economic-corridor-bmec-project, accessed on 16 Nov 2017 26 Progress in Setting up of Industrial Corridors, Government of India, Ministry of Commerce and Industry , Department of Industrial Policy & Promotion http://dipp.nic.in/sites/default/files/rs13.pdf, accessed on 16 Nov 2017 27 Revised master plan for Bangalore – 2031 (Provisional) http://www.bdabangalore.org/TPMRMP2031.html, accessed on 17 Nov 2017

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2. Strategic Analysis of the Sector in Karnataka

Karnataka needs an ambitious vision that responds to the challenges of current levels of basic infrastructure, climate change, and growing footfalls in the state. Historically, infrastructure and within that, actual construction has been very slow in adopting new technology, and with significant time and cost overruns, programs fail to deliver on their desired objectives. 28Propelled by several global megatrends, public transport is witnessing transformational changes across the world, and India is no exception. In the past decade, India has witnessed deep penetration of metro rails, highway infrastructure, ride-hailing services and many such other innovations that mark a march to modernity. India’s airports have turned world class in this decade and competition is vibrant in segments driven by the private sector. Intermodal competition is picking up pace rapidly. Yet deep deficits remain in the provision of public transport services in India. The extensive-but overburdened rail system has raised major operational and safety concerns. Bus transport, mostly dominated by state-owned transport corporations fails to match modern global standards. Inter-modal integration is largely non-existent. First mile and last mile connectivity challenges deprive users of a consistent experience.

This section will primarily focus on key growth drivers that will determine the future path of development for the Infrastructure sector in Karnataka and assess the drivers in line with status quo and challenges faced by the sector.

2.1. Growth Drivers The growth drivers for augmenting infrastructure development in the state are determined with the prime focus to improve transportation infrastructure in terms of quality, sustainability and efficiency for the end user. While the state must focus on appropriately selecting and prioritize their infrastructure needs taking into consideration the backlog of projects in pipeline and financing gap. Incapabilities in bridging this gap can be mitigated by collaborating with the private sector. The key infrastructure demand needs of the state can be fulfilled to a large extent by introducing new models of collaboration, innovative funding/financing models leading to subsequent urban development in the state. The infrastructure needs will largely be determined in relation to the following elements:

Demographics – Level of population growth and age composition

Trade relations – Domestic and International trade relations (Logistics and

Tourism)

Employment level – Increase in employment levels leading to increased number

of commuters

Spatial Development – Regional distribution of demographics and employment

levels determining travel patterns

Technology-driven work modes – Work from home, Walk-to-work concepts

inducing new modes of transport

Affordability – Cost of travel versus scalability of transport options, Fuel costs in

light of green drive etc.

Infrastructure needs are the core driver for economic growth and the key growth drivers of the sector in particular, include the following:

28 Reimagining Public Transport in India, KPMG, October 2017

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Figure 9 Growth Drivers for Infrastructure Development In light of the above key growth indicators for Infrastructure development, Karnataka has shown fundamental progress in their journey towards building sustainable world-class infrastructure facilities to unlock the immense growth potential of the state. Widespread support from Government for Infrastructure Development Karnataka is among the leading states in designing and adopting forward-looking policies. Government Policies and Incentives are key to increasing investments as Government is

Growth Drivers

Government Support

Business Model

Innovation -PPP etc.

Conducive Investment

Environment

First and Last mile

Connectivity

Utilization of existing

assets

Infra up-gradation

New modes of transport

Inter-modal Integration

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to play a crucial role in seeking to achieve both long-term economic benefits and the public good. Right from allocating budgets for projects, land acquisition and monitoring project implementation and service delivery, Government’s support is key. Karnataka government has taken several initiatives such as formulating an infrastructure policy to ensure efficient use of existing assets and optimal allocation of additional resources. Constituted a dedicated infrastructure development department to play a significant role in the areas of developing air, rail and maritime connectivity for the state Building synergy in public-private service delivery through Business Model Innovation The Government of Karnataka provides a fair and transparent policy framework to enable the process of economic growth and encourages Public-Private Partnership (PPP) in upgrading, expanding and developing infrastructure in the State. The State Government wants an increasing role for PPP both in creating new infrastructure assets as well as in managing assets already created. The Government has set up a PPP cell, which will coordinate and facilitate the identification, development, and implementation of infrastructure projects, including facilitation of obtaining clearances and approvals on a PPP route29. The allocation for infrastructure projects has increased by 45% in the period 2012-16 over 2008-12. Karnataka has been a PPP friendly state. A shining example of such of an effort is Kempegowda International Airport, a PPP with Government of India, Government of Karnataka and Private sector. It is now 3rd largest airport in India and awarded “Best regional airport in Central Asia”. Karnataka has KSHIP- First of its kind co-financing projects under PPP with construction grant. Projects with positive Value for Money alone are developed to ensure “Value Delivery” from PPPs. Due to this effort, PPP philosophy shifts from financing focus to performance focus leading to projects successfully achieving financial close and construction is in progress. Building a conducive investment environment in the state through various forward-looking investment platforms

The state has been proactive and in the forefront of attracting investments through various meets and summits showcasing participation from leading investment players and industrialists across the globe. Invest Karnataka, Global Investors Meet, Vendor Development and Investors Meet are few to mention. In 2016, the Global Investors Meet successfully concluded with 1,201 Approved projects and MoUs valued at INR 3, 08,810 crores. This was the culmination of several months of effort by the government that organized road shows in several cities in India and abroad. Government through such events aims to create a platform for best minds to meet, exchange ideas and drive forward the state's vision of prosperity for all - by employing technology, innovation, inclusivity and sustainability as key factors for development. Over the years Invest Karnataka has come to signify successful partnerships and comprehensive and sustained developments. Increased focus on infrastructure up-gradation to meet the needs of a burgeoning population Karnataka government is planning to spend ~ INR 7,300 crore on infrastructure development in Bengaluru city in the next two years largely focusing on up-gradation of the road network in the state as a whole. 717 km of state highways and 3,570 km of major district roads (MDR) is taken up for upgrading in 2017 and plans are in place to develop

29 Infrastructure, Invest Karnataka, http://www.investkarnataka.co.in/focus-sector-infrastructure, accessed on 10 Nov 2017

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2,795 km of state highways and 1,520 km of MDRs at the cost of INR 3,500 crore30 under the State Highway Development Project’s Phase-3 program. The state is looking at options to build a new city to de-congest Bengaluru city. Moving towards greener infrastructure to support and sustain the green future

The state is conducting various promotional events like car and bike rallies, exhibitions and workshops to create awareness on benefits of electric vehicles to commute and also inspire residents to switch over from petrol and diesel vehicles. Karnataka is the first state to roll out an Electric Vehicle and Energy Storage Policy31 that looks not only at boosting sales of EVs but also setting up charging infrastructure and special manufacturing zones. The policy encourages subsidies for charging infrastructure in all public and private properties, including airports, railway stations, metro stations, high-rise buildings, malls, information technology (IT) parks, and apartment complexes. The government is also in the planning process to create a special purpose vehicle involving Bruhat Bengaluru Mahanagara Palike (BBMP), Bengaluru Metropolitan Transport Corporation (BMTC), Bangalore Electricity Supply Company (BESCOM), Karnataka Renewable Energy Development Ltd (KREDL), Karnataka Industrial Area Development Board (KIADB) and other agencies to create more changing infrastructure in Bengaluru and Karnataka32. Mysuru is chosen for the launch of e-bus concept (electric or battery-operated buses)33. Mysuru known to be the cleanest city in India is home to “TrinTrin”, the Public Bike Share (PBS) system of Mysuru. This initiative of the Government of Karnataka is aimed at promoting the use of green transport means through cycling in Mysuru city. Currently, the system features 52 hubs and 450 bicycles34.

2.2. Challenges

While the state has the 5th highest road density among top 10 largest states in India, congestion in city limits is of concern leading to widening of regional disparity in road density.

Unequal access to basic road services

With the increase in the rate of urbanisation, the numbers of people living in slums have also grown proportionately in the cities of the State. Shortfalls in access to physical infrastructure, education and jobs are major concerns. There are large variations in access to basic services across districts is another major challenge, which needs attention. Most of the poor in Karnataka are bound to traditional occupations like agriculture, which offer low returns on their labour, and due to lack of adequate access to basic infrastructure affects their employability in other expanding sectors remains a concern. Several agencies responsible for infrastructure development, resulting in un-

coordinated systems

Roads are built and maintained by public works departments, development authorities and municipal corporations. Different modes such as bike sharing systems, buses, metro, rail

30 Karnataka Plans Rs 7,300 Crore Infra Spend for Bengaluru City, The Hindu Business Line, February 2017, http://www.thehindubusinessline.com/news/national/karnataka-plans-rs-7300-crore-infra-spend-for-bengaluru-city/article9524983.ece, accessed on 10 Nov 2017 31 Karnataka wants to become the electric vehicle capital of India, Business Standard, September 2017, http://www.business-standard.com/article/economy-policy/karnataka-wants-to-become-the-electric-vehicle-capital-of-india-117091301226_1.html, accessed on 10 Nov 2017 32 Karnataka Electric Vehicle and Energy Storage Policy , UITP India, http://www.india.uitp.org/news/Karnataka-electric-vehicle-and-energy-storage-policy, accessed on 20 Nov 2017 33 E-Buses may soon make public transport in Mysuru Green, The Hindu, May 2017, http://www.thehindu.com/todays-paper/tp-national/tp-karnataka/e-buses-may-soon-make-public-transport-in-mysuru-green/article18417638.ece, accessed on 20 Nov 2017 34 Trin-Trin pedal with pride, https://www.mytrintrin.com/?page_id=5064, accessed on 25 Nov 2017

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systems, etc., are planned and operated by various agencies. There is an urgent need to ensure there is a Unified Metropolitan Transport Authority in cities with 1 million population to ensure seamless and efficient integration of different modes.

Land acquisition remained a major hurdle

Land acquisition issues delay the implementation of large-scale infrastructure projects such as the Special Economic Zones, Ring Roads and Investment Corridors in Karnataka. Further, these large-scale infrastructure projects, which have a spatial transformative effect in their influence areas, often do not adopt a land acquisition technique that works towards comprehensive development of their influence areas. These projects have a tremendous impact on the growth and development of the cities in their vicinity. Land acquisition has also remained a major hurdle in the enforcement of land designated for public purposes in the master plans

Sustainable capacity augmentation for public transport systems to be self-

sufficient to meet the burgeoning demand for mobility

Urban centres in Karnataka are witnessing an increase in private vehicle ownership. Public transport capacity needs to be expanded at a higher rate than the anticipated increase in transport demand. This requires careful evaluation of the costs, capacities, transit speeds and gestation periods of different modes of transit capacity augmentation across the city. Improving operational efficiency: Reliability of public transport is a major component of commuter decisions to switch to, and continue using, mass transit. Rationalisation of routes, better maintenance and safety needs to be improved.

Improving service quality through multimodal integration is a key ask. Service quality also plays an important role in incentivising public transport utilisation. Above all, public transport must afford a convenient and pleasant commute – convenience in terms of a fast, seamless journey, and pleasant in terms of fleet comfort and interaction with staff. This requires a high level of integration across transit modes which is currently missing.

Lack of tuning investments in the right direction leading to equitable growth in

public infrastructure and service delivery

High levels of investments in roads without commensurate enhancement of quality public transport leads to more personal modes being adopted. This has several negative externalities in the form of fatalities, air pollution, congestion, etc. Frequent traffic snarls due to narrow and choked road network is proving to be a growth bottleneck adding to increased costs of goods and services.

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2.3. Opportunities

Reconnecting Karnataka

Opportunity Existing Project Status Update Potential benefits for the state Future opportunities

Intra-State Corridors

Suvarna Karnataka Development Corridor (SKDC)

Envisages development of large industrial nodes and industrial areas along national highways and laterals as well as rail line in the North Karnataka region

On hold due to viability issues under land acquisition

Accelerate development of industrial growth through infrastructure support and enable contribution to the economy from potential areas along the corridor. Industrial and economic growth has been growing the Southern region of Karnataka with Northern region engaged primarily in agricultural activities.

Revamp the program in phases with development of a sound transport infrastructure system connecting Karnataka across the length and breadth of the state.

Intra-State Corridors

Bengaluru-Mysuru Infrastructure Corridor (BMIC)

The corridor is currently under legal review with as many as 20 cases pending before Supreme Court and 34 before the Karnataka High Court35

The concept of BMIC was developed to have an efficient infrastructure corridor between two cities Bengaluru and Mysuru, as well as to have planned and organized disposal of population through growth centres, which will acts as counter-magnets to the cities growth.

Five new townships along the BMIC namely:

Commercial township

Corporate township

Industrial township

Heritage township and eco-tourism township36

35 Government mulls takeover of Bangalore Mysore Infrastructure Corridor Project, Star of Mysore, December 2017, https://starofmysore.com/government-mulls-takeover-of-bangalore-mysore-infrastructure-corridor-project/, accessed on 3 Dec 2017 36 Bangalore- Mysore Infrastructure corridor, BMICAPA, http://www.bmicapa.org/, accessed on 3 Dec 2017

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Reconnecting Karnataka

Opportunity Existing Project Status Update Potential benefits for the state Future opportunities

Inter-State Corridors

Bengaluru – Mumbai Economic Corridor (BMEC)

The Perspective Plan has been completed for BMEC Region and approved by the respective State Governments. Dharwad node in Karnataka has been identified as the priority node for further implementation.38

The corridor connects the IT capital of the country to the financial capital.

Creation of this corridor will ease the load on Bengaluru and help rapid development of the industry in the northern parts of Karnataka

The industries expected to benefit from the creation of this corridor are – steel, cement, auto components, readymade garments, food processing, and textile industries.

The plan is to generate around 12% of the country’s GDP along with the 1,000-km corridor between the two commercial towns37.

Inter-State Corridors

Chennai Bengaluru Industrial Corridor (CBIC)

Perspective plan for the overall corridor has been completed and three nodes have been identified for development namely, Krishnapatnam in Andhra Pradesh; Tumakuru in Karnataka; and Ponneri in Tamil Nadu38

Once completed, the corridor will result in a world-class tolled road, a high-speed rail link and industrial clusters all along the corridor.

Most importantly, it provides port access for Karnataka on the eastern coast of India

The focus sectors to benefit under this corridor are – Food processing, Textiles & Apparels, Machinery & Electric machinery, Pharmaceuticals, Petrochemicals, Automobiles, and Computer, Electronics & Optical products39

Inter-State Corridors

Kochi – Bengaluru Industrial Corridor (KBIC)

KSIDC is in the process of selecting consultants for planning development of identified integrated

The corridor is expected to optimize the economic and employment potential of the region, and stimulate

Achieve greater economic integration, improved transport efficiency, increased public-private partnership and enhanced economic competitiveness by

37 Mumbai & Bangalore Industrial (Economic) Corridor, The Indian Wire, December 2017, https://www.theindianwire.com/business/mumbai-bangalore-industrial-corridor-39873/, accessed on 5 Dec 2017 38 FUNDS DISBURSED TO INDUSTRIAL CORRIDORS, Government of India, Ministry of Commerce and Industry , Department of Industrial Policy & Promotion, Rajya Sabha 26 July 2017, http://dipp.nic.in/sites/default/files/ru1129_0.pdf, accessed on 29 Nov 2017 39 Regional Comprehensive Plan, Comprehensive Integrated Master Plan for Chennai Bengaluru Industrial Corridor Final Report, Japan International Cooperation Agency, October 2015 http://open_jicareport.jica.go.jp/pdf/12249348.pdf, accessed on 29 Nov 2017

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Reconnecting Karnataka

Opportunity Existing Project Status Update Potential benefits for the state Future opportunities

manufacturing cluster (IMC) sites for the corridor region

investments particularly in the manufacturing, agro-processing, services, and export oriented units and promote overall economic development of the area through creation of high standard infrastructure and an enabling pro-business environment40

incorporating Karnataka as one of the KBIC states – Kerala and Tamil Nadu in the proposed perspective plan

Elevated Corridor

An elevated corridor provides direct connectivity between different parts of a city through the use of elevated roads and railways.

An elevated corridor project connecting the four corners of Bengaluru was pitched during Invest Karnataka 2016. The project proposal was for 83-

A draft report on the project is in progress as of March 201741.

Proposed corridors include one North-South corridor, two East-West corridors, and three connecting corridors to enable connectivity across city

Network solution that addresses the problem at a city level rather than a sectional level

Integrated solution that allows private commute to co-exist with public transport

Will remove the necessity for flyovers, allowing road development authority to focus on other projects for improving urban commute

Will work as a part of a multimodal urban transport solution and allow people to settle in outer regions of Bengaluru, easing pressure on the existing overburdened infrastructure

40 Selection of Consultant for Preparation of Perspective Plan and Concept Master Plan for IMC sites for Kochi Bangalore Industrial Corridor Region Kerala, KSIDC http://www.ksidc.org/userfiles/rfq_cum_rfp__kbic_perspective_plan.pdf, accessed on 29 Nov 2017 41 Ambitious 83-km elevated corridor project takes shape , The Hindu, March 2017, http://www.thehindu.com/news/cities/bangalore/ambitious-83km-elevated-corridor-project-takes-shape/article17403349.ece, accessed on 29 Nov 2017

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Reconnecting Karnataka

Opportunity Existing Project Status Update Potential benefits for the state Future opportunities

kms of a six-lane elevated corridors at a cost of INR 25,000 crore.

Intra-state Air Corridor (Regional Air Connectivity under UDAN for Karnataka)

UDAN Scheme, the regional air connectivity scheme is launched by the central government to make air travel economical. This is done by providing offering concessions to airlines operating on the RCS routes.

Four airports from Karnataka namely Bidar, Hubli, Mysore and Vidyanagar are identified in the first phase of bidding

Enhance regional connectivity to boost the economy of these areas through intra-state operations to spur infrastructural development and job creation.

Mysore and Hubli are largely to benefit from this scheme, as the road connectivity to both these airports and the services in place by the state transport corporation is good.

Develop synergies with Karnataka Aerospace Policy 2013-23

Align rail/Metro connectivity development plans to connect RCS airports in coordination with the Central Government

Encourage development of private airports under the RCS scheme

Align policy objectives to offer additional incentives

Develop airstrips and helipads at all district headquarters and important industrial destinations that do not have air connectivity.

Develop airstrips at Davanagere, Chikkmagaluru, Udupi, Madikeri, Gokarna, Chitradurga, Bagalkot, Haveri, Gadag and Kollegal. Alignment of the 19 airports identified for the RCS Scheme in line with the above air strip

Table 12 Current Infrastructure Projects for Reconnecting Karnataka

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Karnataka shares its boundary with six other states paving way for widening opportunities in developing cross-state trade and investments. Karnataka can carve out massive opportunities by focusing development of various types of development corridors in alignment with Government of India’s flagship initiative “Make in India” pillar of new infrastructure development which strives to develop industrial corridors and smart cities, create world class infrastructure with state-of-the-art technology and high-speed communication. The increased prospects that these corridors offer facilitate socio-economic development of the region.

Economic corridors are driven by cluster based corridors through integration of various networks of infrastructure, industrial, sector-based activity in a region to stimulate economic development.

Basic infrastructure facilities to help enable successful operation of these corridors are as follows; not limited to:

1. High-speed road connectivity

2. Easy accessibility to airports via road and metro

3. Seamless movement of freight from ports to industrial hubs

Potential opportunities that Karnataka can build upon by reshaping the current opportunity landscape of projects already planned, in progress or are in conceptual stages of transport, industrial and cross-border economic corridors are discussed in the following section.

Type of corridor

A Inter-state corridor

Karnataka- Maharashtra 1

Karnataka- Telangana 2

Karnataka- Andhra Pradesh 3

Karnataka- Tamil Nadu 4

Karnataka- Kerala 5

Karnataka- Goa 6

B Intra-state corridor

Bengaluru-Mandya-Mysuru-Chamrajnagar 1

Chitradurga-Bellary-Gulbarga-Bidar 2

Dharwad-Koppal-Raichur 3

Bengaluru-Hassan-Mysuru 4

Chitradurga-Haveri-Karwar 5

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Tumakuru-Shimoga-Honnavar 6

Raichur-Bagalkot-Belgaum 7

C Coastal Trade

D Tourism

Heritage Circuit and Spiritual (Sufi) Circuit 1

Coastal Circuit 2

Wildlife Circuit 3

Nature Circuit 4

Urban Circuit 5

Table 13: Potential corridor development opportunities for the state

Figure 10 Potential Inter-State and Intra-State Corridors for Karnataka

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Figure 11 Potential Tourism Circuits in Karnataka

Opportunity A – Inter-State Development Corridors

Industrial corridors (Maharashtra and Tamil Nadu)

Tourism corridors (Goa and Kerala)

IT corridors (Andhra Pradesh and Telangana)

Karnataka Market Potential42

Karnataka is the IT hub of India and home to the 4th largest technology cluster in the world. Karnataka has 19 operational IT/ITeS SEZs, 5 software technology parks & dedicated IT investment regions.

Exports of IT & Electronic products from the state reached USD 37.25 billion by the end of December 2016.

Karnataka has vibrant Automobile, Agro, Aerospace, Textile & Garment, Biotech & Heavy Engineering industries. The state has sector-specific SEZs for key industries such as IT, Biotechnology, Engineering, Food processing and Aerospace.

42 District Profiles, Invest Karnataka, http://www.investkarnataka.co.in/district-profiles, accessed on 10 Nov 2017

46

Karnataka has 44 universities, 4,519 pre-university colleges, 206 engineering colleges and 293 polytechnics, 47 medical colleges and 38 dental colleges.

The state also houses 401 R&D centres; around 400 of the Fortune Global 500 companies outsource their IT services to firms in Bengaluru.

Karnataka Industrial Policy, 2014-19 offers wide range of fiscal and policy incentives for businesses

Production Clusters

Karnataka provides:

70% of coffee produced in India,

60% of production of safflower in India

60% of production of Ragi (Finger Millet) in India

Figure 12: Agriculture Production Clusters of Karnataka

Source: Report titled ‘Investment Environment & Opportunities in Food Processing’ by Ministry of Food Processing Industries

Processing Clusters

Karnataka has about 54,905 agro processing units with an investment of INR 4429 crores (USD 651 millions) lakhs as of 2015. There are 80+ food processing companies in the food parks in Karnataka.

Processing clusters planned by Government of Karnataka

o Sea Food Park near Mangaluru which is in the conceptualization stage

o Rice Technology Park at Karatagi in Koppal district, over 315 acre land

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o Maize Technology Park in Haveri district, over 60 acre land

o Spice Technology Park in Haveri district, over 100 acre land

o Favorich Infra Pvt Ltd., Mandya - 120 acres - Mega Food Park supported by GOI

Figure 13: Food Processing Clusters of Karnataka

Source: Report titled ‘Investment Environment & Opportunities in Food Processing’ by Ministry of Food Processing Industries

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Industrial Landscape

Figure 14 Industrial Activity Hubs in Northern and Southern Karnataka

Figure 15: Industrial Infrastructure of Karnataka

Source: Report titled ‘Investment Environment & Opportunities in Food Processing’ by Ministry of Food Processing Industries

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FDI Inflows43

The cumulative FDI inflows in the state from April 2000 to June 2017 were recorded at USD 24.63 billion, the 4th highest in India after Maharashtra, Delhi and Chennai accounting for a share of 7.2% in India’s cumulative FDI inflows.

Key Industries42

IT and ITeS, Biotechnology, Engineering, Electronics and Telecom, Automotive, Textiles and Apparel, Aerospace, Tourism and Renewable energy

A1 – Karnataka-Maharashtra Corridor

Market Potential43

Mumbai - Commercial capital of India and has evolved into a global financial hub

Leading state in textile exports and production

State has 25 operational SEZs44, majority share contributed by IT/ITeS, Engineering and Electronics sector.

Jawaharlal Nehru Port is the largest port in India in terms of container traffic and the port handled 32.69 million metric tonnes of traffic during 2017-18 (up to September 2017). 24 companies had offered to invest more than INR 60,000 crore in a special economic zone adjoining JNPT45

Pune, another major city in the state, has emerged as the educational hub

Maharashtra has maintained the leading position in the industrial sector in the country. The state is a pioneer in small scale industries and has largest number of special export promotion zones.

The state has a large base of skilled and industrial labour, making it an ideal destination for knowledge based and manufacturing sectors.

FDI Inflows43

Cumulative FDI inflows during April 2000 to June 2017 stood at USD 104.4 billion

Key Industries43

Pharmaceuticals, Biotechnology, IT and ITeS, Electronics, Engineering, Auto and Auto components, Oil and Gas, Food and Agro Processing, Gems and Jewellery, Banking, Financial Services and Insurance (BFSI) and Textiles

A2 – Karnataka-Andhra Pradesh Corridor

Market Potential43

Andhra Pradesh accounts for a major share in the overall exports of seafood products from India, in value terms.

43 IBEF State Reports, Indian Brand Equity Foundation, Nov 2017 44 As on June 2017. Source: IBEF 45 As on Dec 2017, Source: Media Reports

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The state provides ample growth opportunities due to availability of ports along with land availability for expansion, etc.

Out of the 23 operational SEZs in Andhra Pradesh, 4 are pharmaceutical SEZs.

Visakhapatnam port ranks fourth in terms of port traffic. During Mar-Aug 2017, the cargo handled at the port was 30.15 million tonnes.

As of September 2017, the state had 20 operational SEZs across diversified sectors which include Textiles & Apparel, Food Processing, Footwear & Leather products, Pharma, IT SEZs, etc.

In March 2016, the Government of India announced its plans of setting up a National Investment & Manufacturing Zone (NIMZ) in Prakasam district which would help generate 5 lakh jobs over next 10 years. Land acquisition for the project has already been started

FDI Inflows43

FDI inflows in Andhra Pradesh from April 2000 to June 2017 reached USD 14.14 billion.

Key Industries43

Agro and Food-based, Biotechnology, Bulk Drugs and Pharmaceuticals, IT and ITeS, Textile and Leather, Tourism, Automotive and Auto components, Gems and Jewellery

A3 – Karnataka-Telangana Corridor

Market Potential43

Majority of the multinational companies holds production base in Hyderabad.

Information technology and pharmaceutical sectors are the fastest growing sector of the state and driving the economic development of Telangana.

Hyderabad is the major IT hub of the state across the country. During 2015-16, the value of IT exports from the state of Telangana was recorded at USD 13.27 billion.

In January 2017, the state government signed MOUs for several investments and strategic partnerships, worth USD 503.04 million. The investment also includes setting up of Life Sciences Infrastructure Fund in the state.

As of June 2017, Telangana had 146 SEZs; of which, 29 are operational, 52 are notified & 64 are formally approved

FDI Inflows43

According to the Department of Industrial Policy & Promotion (DIPP), cumulative FDI inflows in Telangana from April 2000 to March 2017, totalled USD 13.76 billion.

Key Industries43

IT, Pharmaceuticals manufacturing, Tourism, Textile, Mines and Minerals

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A4 – Karnataka-Kerala Corridor

Market Potential43

Kerala is one of the few states to have marketed its natural beauty successfully to the leisure tourism sector. The state’s unique heritage and cultural diversity have helped attract tourists from the world over

Kerala has the 1st international transhipment terminal in India, having a design capacity of around 4 million TEUs and providing better connectivity between Kerala and other ports in India.

Kerala has been promoting knowledge-based industries such as IT/ITeS, Computer Hardware & Biotechnology. It is the first state having a Technology Park with CMMI level 4 quality certification & a world-class IT campus in Thiruvananthapuram

The total cargo traffic handled by Cochin port during 2016-17 was 25 million tonnes, recording an increase of 13.16% against 22.09 million tonnes for the year 2015-16.

As of September 2017, Kerala had 29 SEZs with formal approval and 25 notified SEZs

Kerala is the leader in rubber production; high demand of rubber has opened up immense opportunities

Kerala Infrastructure Investment Fund Board will be provided with an envisioned resource envelope of USD 4.58 million during 2016-17, in order to enable and provide more investments in the state.

FDI Inflows43

According to DIPP, during April 2000 to June 2017, FDI inflows into the state

(including Lakshadweep) reached USD 1.79 billion.

Key Industries43

Handlooms and Power looms, Rubber, Bamboo, Coir, Khadi and Village, Sericulture, Seafood and other Marine products, Cashew, Mining, Tourism, Food Processing, Spice and Spice extracts, IT & Electronics

A5 – Karnataka-Goa Corridor

Market Potential43

During 2016-17, the total traffic handled by Mormugao port was recorded to be 33.18 million tonnes, thereby registering a growth of 59.70% over the previous year, which is the highest growth rate among 12 major ports of the country.

Goa is a popular tourist destination due to its natural beauty and bountiful avenues for leisure and relaxation. During 2016, Goa was the ninth most visited state in terms of footfall of foreign tourists with Foreign Tourist Arrivals (FTAs) reaching 6,80,683.

Established base for the pharmaceuticals industry and an emerging destination for knowledge-based industries such as biotechnology and IT.

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As of September 2017, Goa had seven formally approved and notified 3 special economic zones (SEZs).

FDI Inflows43

According to the Department of Industrial Policy & Promotion (DIPP), FDI inflows into the state of Goa, during April 2000 to June 2017, totalled to USD 960 million.

Key Industries43

Tourism, Food processing, IT & ITeS, Mining, Biotechnology, Pharmaceuticals and Fishing

A5 – Karnataka-Tamil Nadu Corridor

Market Potential43

Tamil Nadu has a diversified manufacturing sector and features among the leading states in several industries like Automobiles & components, Engineering, Pharma, Garments & Textile products, Leather products, Chemicals & Plastics, etc.

Due to its achievements as an auto production hub, Chennai has been dubbed as the ‘Detroit of India’.

Due to its proximity with East Asian countries, Chennai is also endeavouring to become an international finance hub.

It is one of the first states in India to have 100% metalled road connectivity.

Tamil Nadu ranks first among all states in terms of the number of factories and industrial workers.

In April 2017, the Japan International Cooperation Agency (JICA) decided to provide a loan of USD 199.36 million for the second phase of Tamil Nadu Investment Promotion Programme, which aims to boost the investment opportunities in the state.

As on June 2017, state has 47 Notified SEZs, 49 SEZs with formal approvals and 4 SEZs with in-principle approvals

FDI Inflows43

The cumulative FDI inflows in the state during April 2000 to March 2017 amounted to USD 23.76 billion, witnessing growth of 18.6% between 2014-15 and 2015-16.

Key Industries43

Textiles, Heavy Commercial Vehicles, Automobile and Auto components, Engineering, IT and ITeS, Cement, Banking and Financial services, Drugs and Pharmaceuticals, Agro and Food processing, Leather tanning industries, Electronic Hardware and Tourism

Opportunity B – Intra-State Development Corridors

To enable a balanced development of Karnataka and a more equitable distribution of economic activities, creation of world-class infrastructure is essential at multiple urban

53

locations. Potential for corridor infrastructure development lies in Tier-2 Cities such as Mysore, Mangalore, Hubli-Dharwad, Belgaum, Bellary, Raichur, and Gulbarga46.

B1 - Bengaluru-Mandya-Mysuru-Chamrajnagar42

Bengaluru is the highest contributor of the state GSDP with 33.3% share accounting for INR 993.25 billion.

The district has 16 Industrial Areas – of which Peenya is the largest industrial cluster in Asia, 13 Industrial Estates and 14 notified operational SEZ in Bengaluru forms the framework to the rich industrial landscape in the region

Highest IT related exporter with 35% of the 1 million IT pool of India employed here

Bengaluru has India’s largest bio-cluster with 40% of India’s biotechnology companies present here

Bengaluru anchors Aerospace industries in India. Bengaluru is the headquarters of ISRO & DRDO, and many internationally renowned institutions like HAL, DRDO, ISRO, ADA, NAL, IISC, and Antrix. Also, 4 out of 9 R&D Centre’s of HAL and DRDO’s 5 Aeronautic Centres are in Bengaluru.

Bengaluru is a rich repository of research institutes that have contributed immensely to the growth and innovation in the knowledge-based sector

Bengaluru ranks the highest in implementation and value of PPP projects in India.

Engineering production sector is well etched in Bengaluru with a growing ecosystem well nurtured by Industrial Icons like – Toyota, Bosch, L&T, Kirloskar, Escorts Ltd (Automotive Division), Saginaw India, Avasaralu Automations and Omax Autos Limited.

Mandya is an emerging hub for Agro and food processing industries. The district contributes to the annual production of 26, 00,000 metric tons of sugar and 10, 00,000 metric tons of jiggery. 35 rice mills, 4 sugar factories and a cluster of jaggery making units in Mandya constitute the main industrial sector.

Mandya ranks 3rd in Karnataka for its Sericulture produce. The 40,000 Seri culturist well supported by 22 technical centres work on 24,000 Hectares of mulberry cultivation to develop sericulture with a technology advantage in the region offer huge scope for expanding of the area under bivoltine and introducing modern and automatic reeling units here

A handloom cluster is well formed and has a strengthened ecosystem with the presence of textile majors like Welspun, Gokaldas, Shahi Exports and more

District is engaged in cluster activity across sectors like Rice Mills, Agriculture Implements, Power looms and Packaging

Special Zone industries operational - Aromatic, Ayurveda medicines, Tools and Dies, filament for bulbs, Hi-tech bus body building, conveyor belt, coconut tetra packing

The temple town has a regular stream of visitors round the year and is a key contributor to the economy of the region.

Mysuru is an emerging IT hub with 2nd largest software exports in the state

46 Vision 2025 Concept Note , Government of Karnataka, http://udupi.nic.in/docs/GOK%20Vision%202025%20Concept%20Note.pdf, accessed on 10 Nov 2017

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The City of Palaces retains the old world charm and continues to be ranked the best among tourist locations in the country and amongst top 5 best tourist cities in the world

Various new industrial projects are proposed which include an IT park along with the established STPI with 1374 units – the second largest in the state; and a textile park with artisan clusters and silk clusters is set to drive the world famous Mysore Silk.

Specific agro processing units with value chains for value added food products is a potent opportunity. Other ancillary like organic food products packaging and export have resulted in a food cluster in Mysore.

Chamrajnagar is endowed with rich natural reserves of both metallic and non-metallic minerals especially the high-value quality of black granite

Agriculture and allied industries are dominant with sericulture, horticulture and fisheries playing vital role and major contribution of 3% to the state GSDP

The industrial potential is thus well established - creating and integrating value chain for the growing Horticulture Produce like Banana, Coconut, Chili, Turmeric, and Onion. A Food park is proposed by the Government of Karnataka including cold chains and processing facilities to tap this potential. Other opportunities in the district include the use of technology to enhance productivity, improving soil conditions, post-harvest technology development, and extensions along with organic farming.

The availability of tanks and reservoirs, with growing domestic demand, has added impetus to inland fishing here, especially in the ornamental segment. The availability of huge value granite is expected to propel the granite cutting and polishing cluster too

KIADB is developing Industrial Area spread over in 1,600 acres of land at Badanakuppe - Kellamballi village for formation of industrial area in Chamarajanagar District

B2 - Chitradurga-Bellary-Gulbarga-Bidar42

Chitradurga has one of the best high wind sites in the country making it the 4th largest producer of wind energy. It also has highest reserves of limestone, a number of large and medium cement industries

The dominant agriculture sector is well enhanced with a 106 - acres Akshaya Food park at Hiriyur

Textile constitutes second highest number of Large & Medium industries in the district. It has 3 artisan clusters in Textile Handlooms and Hand Printing in the region

Corridor Offerings

Agro Cluster Development – Innovation in Agro R&D

Large scale Industrial Hub

Education Hub

Heritage Tourism

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Bellary is known popularly as 'The Steel city of South India'. The natural rich mineral reserves coupled with the textiles and tourism has been at the forefront in contributing to the immense growth of the region.

The district has 7 industrial areas and 5 industrial estates to which a Steel Ancillary Park is proposed. Also planned are Garment Cluster, Mirror Embroidery Cluster, and a Rice Mill Cluster to focus on Agro and processing industry segment

The textile clusters dealing with 'jeans' and presence of brands like Point Blank, Dragon Fly, Walker, and Podium. They have 45-50 dyeing units and 500 stitching units here.

An apparel park and exclusive denim park is proposed in this region. Textile constitutes second highest number of Large & Medium industries in the district with 3 artisan clusters in Textile Handlooms and Hand Printing

Kalaburagi (Gulbarga) contributes to 40 % of the state's agriculture production and is also recognized as a cement producing zone

A state of the art, Jewargi Agro Food Park with specialized infrastructure facilities for food processing and allied industries is available on a 106 - acre land. Sugarcane and Cotton are other major thrust areas in the district

The department of industries and commerce, the government of Karnataka proposes to develop a special industry zone for cement and IT/BT on the PPP model in Kalaburagi district.

A textile park is proposed to be developed amidst the blooming handloom clusters

Floriculture, aromatic and medicinal herbs are other thrust areas in the district. It also has a well-developed Dairy industry in the cooperative sector under the banner of Karnataka Milk Federation (KMF)

Bidar is known as the pulse bowl of Karnataka and has 30% of its MSME in agriculture and food processing sector. Over 12,000 hectares of land has been identified for the proposed National Investment and Manufacturing Zones (NIMZ) in Bidar.

B3 - Dharwad-Koppal-Raichur42

Dharwad is uniquely positioned between Bengaluru and Mumbai and is an important business center in the state.

Dharwad is well set with its 8 industrial area and 5 estates with the existing IT/BT zone and industry specific zone for automobile, readymade garment and food processing adding confidence to the district. However the growth and potential of the region is further augmented with proposed apparel zone with SKDC which gives this sector a huge opportunity for development

Dharwad is well geared on its infrastructure readiness with the Bengaluru – Mumbai Economic Corridor initiating land acquisition for 4871 acres of the planned 14585 acres. The Dharwad node has the potential to become globally competitive

Corridor Offerings

Textile Hub

Renewable Energy Powerhouse

Food Processing Hub

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in Heavy Engineering, Automobiles, Auto and Engineering Ancillary, Aerospace and Defense.

Koppal is an agriculture based economy with 2nd largest produce in the state thrust on food processing industries creating a value chain of industries across the produce in the region.

A proposed rice technology park is set to add momentum to the food processing industries here.

Power generation is a focus area in Koppal with a Mini Hydel power unit at Shivapura, one wind power generation unit in Hanumansagar and three Biomass power units in Gangavathi Taluk made available

Two new Industrial estates 104 and 100 acres in Koppal and Yelburga respectively are proposed to augment the industrial infrastructure in the region.

Raichur is known as the Rice Bowl of India, Raichur is well-known for its gold manufacturing unit. The district is set to energize its further growth with a Solar Photo Voltaic power plant and a proposed special Industrial zone.

GoK already setting up a Power Generation Zone in the region and proposing Special Industrial Zone for Steel industries. Some of the other projects like Manufacturing of Pig Iron, Integrated Steel Plant, Ore pelletizing have also been approved by the High-Level Committee (HLC).

The agro-based food processing sector is also a thrust area with the district known as the ‘Rice Bowl’ of India, 438,045 ha of land is used for the cultivation of Paddy with over 100 rice milling industries.

Raichur exports Agriculture Products to European Countries and has good support infrastructure like APMC yards with 2 units of KSWC Ltd. and KMF. A multipurpose cold storage of 5000 MT capacity in the district enhances the ecosystem here.

B4 - Bengaluru-Hassan-Mysuru42

Bengaluru is the highest contributor of the state GSDP with 33.3% share accounting for INR 993.25 billion.

The district has 16 Industrial Areas – of which Peenya is the largest industrial cluster in Asia, 13 Industrial Estates and 14 notified operational SEZ in Bengaluru forms the framework to the rich industrial landscape in the region

Highest IT related exporter with 35% of the 1 million IT pool of India employed here

Bengaluru has India’s largest bio-cluster with 40% of India’s biotechnology companies present here

Bengaluru anchors Aerospace industries in India. Bengaluru is the headquarters of ISRO & DRDO, and many internationally renowned institutions like HAL, DRDO,

Corridor Offerings

Gateway to immense opportunities offered under Bengaluru Mumbai

Corridor

Power Generation Zone of Karnataka

Rice based industrial clusters

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ISRO, ADA, NAL, IISC, and Antrix. Also, 4 out of 9 R&D Centre’s of HAL and DRDO’s 5 Aeronautic Centers are in Bengaluru.

Bengaluru is a rich repository of research institutes that have contributed immensely to the growth and innovation in the knowledge-based sector

Bengaluru ranks the highest in implementation and value of PPP projects in India.

Engineering production sector is well etched in Bengaluru with a growing ecosystem well nurtured by Industrial Icons like – Toyota, Bosch, L&T, Kirloskar, Escorts Ltd (Automotive Division), Saginaw India, Avasaralu Automations and Omax Autos Limited.

Hassan is as an industrial growth center along with 6 developed industrial areas and 4 special economic zones.

Approximately 70% of the population is engaged in agriculture occupation with a 265 acres food processing SEZ for export oriented units.

The existing textile zone with an investment of USD 114.69 million providing employment to 2000 plus persons is powered by a 614.17 acres KIADB’S Dedicated Textile SEZ. Presence of 3 exclusive textile export oriented units augments its strength in the region.

Hassan resonates with the names of Belur-Halebeed and Sravanabelagola. The temples at Belur & Halebeed are the mute testimony to the highest peak of Sculpting skills

Mysuru is an emerging IT hub with 2nd largest software exports in the state

The City of Palaces retains the old world charm and continues to be ranked the best among tourist locations in the country and amongst top 5 best tourist cities in the world

Various new industrial projects are proposed which include an IT park along with the established STPI with 1374 units – the second largest in the state; and a textile park with artisan clusters and silk clusters is set to drive the world famous Mysore Silk.

Specific agro processing units with value chains for value added food products is a potent opportunity. Other ancillary like organic food products packaging and export have resulted in a food cluster in Mysore.

B5 - Chitradurga-Haveri-Karwar42

Chitradurga has one of the best high wind sites in the country making it the 4th largest producer of wind energy. It also has highest reserves of limestone, a number of large and medium cement industries

Corridor Offerings

Agro-based Food Processing

Heritage tourism

Textile Cluster

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The dominant agriculture sector is well enhanced with a 106 - acres Akshaya Food park at Hiriyur

Textile constitutes second highest number of Large & Medium industries in the district. It has 3 artisan clusters in Textile Handlooms and Hand Printing in the region

Haveri comprises of world famous chilly market at Byadagi and is a major export hub for Byadagi chilly. A 120 acre Spice Park is proposed to further spice up the affairs in the district.

Excellent agro-climatic conditions conducive for high value horticultural/mulberry cultivation and quality seed production across the district

Presence of large players like Grasim Industries Ltd, Kumarpattanam, Ranebennur and Harihar Polyfibres and that of Farmers’ Co-operative Spinning Mill Ltd involved in cotton yarn adds momentum to the textiles sector in the region.

Karwar (Uttara Kannada) at the coastal belt of Uttara Kannada is Karnataka’s largest port with a capacity of 75000 million tonne liquid storage and 30000 MT warehousing facility. Government of Karnataka is keen on developing 6 berths under PPP in Karwar port.

Uttara Kannada lends itself to agro and processed food products. Large coastlines with suitable climatic conditions help the Agro and Horticulture products.

The rich bio-diversity in the region is ideal for Organic Farming too. There are established processing unit for Cashew, Pineapple, Coconut and Vanilla and high potential for processing of Areca nut, Cocoa, Pepper, Cardamom and other Spice Crops.

Uttara Kannada has 4 clusters for handicraft and one more exclusively dedicated to Jewellery

The other sectors flourishing here include - the Aromatic and Herbal Processing Industry, Tile, Coir, Engineering and Construction along with Fisheries with 6 cold storages in support of this sector.

B6 - Tumakuru-Shimoga-Honnavar42

Tumakuru is home to specific infrastructure implementation across sectors including Food Park, Textile Park, Industry Park and more. Identified as part of Electronics Manufacturing Cluster.

Agri and Food Processing Industry is a highly focused sector; A 103 acre Food Park at Vasanthanarsapura is set to ignite the sector with not just infrastructure and food processing equipment, but the technology up-gradations and better techniques of production and knowledge transfer on grading, processing, packing and marketing being given impetus here.

Rice mills, Coir industries, Oil extraction mills are the other major agro based industries in the region

Corridor Offerings

Agro-based Food Processing

Heritage tourism

Textile Cluster

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The district has a thrust on textiles with a proposed Textile Park, An Apparel Zone, A Readymade Garments Zone and a Handloom Cluster in the district. The district also has plans for an Integrated Machine tool Industry Park and Machine tools focused technology Incubation Centre in association with GoK on PPP mode.

Tumakuru (Tumkur) is strategically located at the Centre of fast growing domestic car markets in Gujarat, Maharashtra and Tamil Nadu and has been identified as part of Electronics Manufacturing Cluster in under M-SIP (Modified Special Incentive Package) scheme which provide financial incentive. Establishment of Flower Auction Centers in Tumakuru (Tumkur) with an investment of USD 3.12 million (INR 15 crores) is also proposed.

Shivamogga (Shimoga) has both Jog falls - the highest waterfall in India and Agumbe known as the Chirapunji of South India because it receives the highest rainfall in South India

Shimoga is the leading industry sector in terms of investments and income generated both in Agriculture and Food Processing segment.

Handicraft is a booming sector. 3 Wood Carving Clusters in Sagar, Shivamogga and Sorab Taluks, A Wood Turning and Laquerware Cluster in Bhadravati Taluk, a Cane and Bamboo Cluster in Agumbe Taluk and a Shopping bags/fancy items and Toys Cluster in Shivamogga Taluk add the much needed impetus to help them thrive in the district.

The focus sector in Shivamogga (Shimoga) include Iron and Steel, Paper Mills, Dairy Units, Soaps and detergents and Automobile based units.

Uttara Kannada’s coastal belt holds Karnataka’s largest port Karwar with a capacity of 75000 million tonne liquid storage and 30000 MT warehousing facility. Government of Karnataka is keen on developing 6 berths under PPP in Karwar port. Honnavar is a town in Uttara Kannada district where the Sharavathi River meets its final destination – the Arabian Sea giving rise to a medley of beautiful islands.

Uttara Kannada lends itself to agro and processed food products. Large coastlines with suitable climatic conditions help the Agro and Horticulture products.

Mavinkurva is one of the biggest and most inspiring island in the chain of islands formed by the Sharavathi River. With long winding paths and tufts of coconut groves, the islands are each tiny patches of paradise blissfully disconnected yet close enough from the mainland for comfort.

The rich bio-diversity in the region is ideal for Organic Farming too. There are established processing unit for Cashew, Pineapple, Coconut and Vanilla and high potential for processing of Areca nut, Cocoa, Pepper, Cardamom and other Spice Crops.

Uttara Kannada has 4 clusters for handicraft and one more exclusively dedicated to Jewellery

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The other sectors flourishing here include - the Aromatic and Herbal Processing Industry, Tile, Coir, Engineering and Construction along with Fisheries with 6 cold storages in support of this sector.

B7 - Raichur-Bagalkot-Belgaum42

Raichur is known as the Rice Bowl of India, Raichur is well-known for its gold manufacturing unit. The district is set to energize its further growth with a Solar Photo Voltaic power plant and a proposed special Industrial zone.

GoK already setting up a Power Generation Zone in the region and proposing Special Industrial Zone for Steel industries. Some of the other projects like Manufacturing of Pig Iron, Integrated Steel Plant, Ore pelletizing have also been approved by the High-Level Committee (HLC).

The agro-based food processing sector is also a thrust area with the district known as the ‘Rice Bowl’ of India, 438,045 ha of land is used for the cultivation of Paddy with over 100 rice milling industries.

Raichur exports Agriculture Products to European Countries and has good support infrastructure like APMC yards with 2 units of KSWC Ltd. and KMF. A multipurpose cold storage of 5000 MT capacity in the district enhances the ecosystem here.

Bagalkot is a haven of natural reserves like lime stone, granite, pink granite, dolomite and more. The natural reserves lend itself to manufacturing cement, with large national players building a strong presence here

GoK has proposed specific industry parks, IT and BT parks plus an agro-food park. It has 6 industrial areas and 3 industrial estates

More than 15% of MSME's focus on textiles and handlooms as both skilled weavers and raw material like cotton grown is accessible in the region.

Belagavi (Belgaum) houses India's first notified Aerospace Precision Engineering and Manufacturing SEZ center. Rich deposits of bauxite and 200 foundries producing over 70,000 tons of automotive and industrial casting of ferrous base has made it an important center for manufacture of heavy machine tools and high pressure oil hydraulics.

The locational advantage of being right in the middle of Bengaluru - Mumbai region is a major advantage in developing the region as a support base for Automobile and Aerospace industries here

Foundry and Power loom (MSME) cluster in Belagavi promotes Dolls & Toys, Horn & Bone, Metal ware, Artistic Chappals by hand, Pottery & Clay, Terracotta, Textiles Hand Embroidered (Artisans) Clusters defining the rich inventory with niche focus in the region.

Corridor Offerings

Trade investment region – Port-based development region

Coastal Tourism

Wildlife Tourism

Handloom Textile Hub

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Belagavi is the emerging hub for storage/cold storage infrastructure augmenting the agriculture and allied industries here. 58 Export oriented units, 22 Sugar industries and Raisin and Jaggery cluster in Chikkodi taluk further enhance the agro base industries.

Opportunity C – Coastal Trade Corridor

Ports are the cornerstone of international trade and world economic growth, with maritime transport now accounting for nearly 85% of global demand. The long western coastline and strategic location provide an opportunity to develop multiple international gateways to connect India along Karnataka with global value chains. While Karnataka has only one major port (Mangalore) on the Western Coast right now, under the various GoI schemes such as Sagarmala, there are more ports in development in the state including Belikeri, Tadadi and Karwar as well as upgradation of existing minor ports. Historically, the western coast of India has been critical for maritime commerce and has traded with countries in the Arabian Peninsula, Persian Coast, East Coast of Africa, and connecting as far as Northern Africa and Mediterranean Sea. Famously, Vasco da Gama landing near Calicut in 1498 established a sea rout between India and Europe.

While in historical times, it was the spice trade that attracted commercial interest, in modern times the west coast today has several industrial hubs that offer a whole range of goods and services. While this region is actively trading with the rest of the world, as demonstrated by China, the growth opportunity in this area is limitless.

The proposed East Coast Economic Corridor (ECEC)47, India’s first coastal corridor runs along the entire east coast from Kolkata to Kanyakumari. The proposed coastal corridor is a multimodal, regional maritime corridor that can play a vital role in unifying the large domestic market, as well as integrating the Indian economy with the dynamic global value chains of Southeast and East Asia. Apart from an ambitious infrastructure program, the ECEC involves developing skills, and creating an attractive regulatory environment, bringing in new investments, and nurturing existing businesses to grow and innovate, and create much needed jobs.

Karnataka has a huge potential to position itself as an emergent player in the western coastal corridor. Mangalore and Karwar ports are well positioned to hold the future baton to roll out the Western Coastal Economic Corridor proposition. Coastal economic zones (CEZs48) can help achieve this as these zones are aimed at promoting development of port-proximate industrial clusters, encourage port-led development, reduction of time and logistics cost for movement of domestic cargo and export-import cargo in effect leading to integrated development of port-led industrial development along the coastal region. However, in order to roll-out development of CEZs it is essential to equip ports with existing activity with deep drafts capable of accommodating heavy and large ships. Fourteen Coastal Economic Zones have been identified along the coastline of the country in the National Perspective Plan of

47 Economic Corridor Development (ECD) now at the forefront in promoting Sustained Growth in the SASEC Sub-region, Press Information Bureau ,Government of India, Ministry of Finance, March 2017 http://pib.nic.in/newsite/PrintRelease.aspx?relid=159935, accessed on 29 Nov 2017 48 Setting up of Coastal Economic Zones, Press Information Bureau ,Government of India, Ministry of Shipping, December 2016, http://pib.nic.in/newsite/PrintRelease.aspx?relid=154922, accessed on 29 Nov 2017

Corridor Offerings

Heavy manufacturing Hub

Handicraft Export zone

Agro-based food processing and Exports

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the Sagarmala Programme. Amongst these, a CEZ in Karnataka is proposed in connection with the New Mangalore port and potential petrochemical industry in the vicinity of the port.

They key elements to build a CEZ are as follows49:

Large area with some existing infrastructure and economic activity.

Business friendly ecosystem - ease of exporting and importing, environmental

clearances, rapid water and electricity connections etc.

Need for urban spaces to house local resident workforce.

Benefits for the state

Attract large export-oriented firms equipped with world-class technology and work force

Create an ecosystem for small and medium to emerge and flourish

Help existing sector-specific zones and clusters to emerge within the CEZ to fully exploit economies of scale and agglomeration.

Opportunity D – Tourism Corridor

The key constituent of regional tourism development is the integration of high performing tourism sites. The development of a tourist circuit involves identification and assessment of thematic tourism clusters - a group of highlighted tourism attractions within a limited geographic space. Once a tourism circuit is identified, projections for tourist arrivals based on historical data in addition to the carrying capacity of a location are assessed to formulate a suitable development approach outlining the strategic recommendations, guidelines and infrastructure requirement at the identified tourism circuit as part of the tourism circuit development.

Karnataka Tourism Vision Group has examined “Clusters” of tourism interest by themes. Accordingly, seven clusters were identified based on a ten point rating scale based on Domestic (within State) and Inbound (Outside State) tourist interest50.

1. Urban Tourism - Bangalore, Mysore, Coorg in focus. Belur-Halebeedu, Srirangapatna as options in the Southern area

2. Hampi (Heritage) - Hampi, Badami, Aihole, Pattadakal, Bijapur, Gulbarga, Bidar

3. Western Ghats (Nature) - Shimoga, Uttar Kannada, Chickkamagalur, Hassan, Kodagu

4. Wildlife - Nagarhole, Bandipur, BRT, Kavery, Bannerghatta

5. Medical (Wellness) – Bangalore

6. Spiritual - Mookambika, Udupi, Dharmasthala, Karkala, Muradeshwar, Gokarna, Shravanabelagola, Gulbarga+Bijapur+Bidar+Ramnagar (Sufi)

7. Coastal (Sun, Sea & Sand) - Mangalore, Udupi, Kundapur, Muradeshwar, Karwar & Gokarna

Karnataka Tourism Policy 2015-2020 provides an indicative list of potential tourism clusters as below:

Tourism Cluster Focus Tourism Destinations

Urban Tourism Mysore, Coorg, Belur-Halebeedu, Srirangapatna, Gulbarga

49 Jobs, Growth and Coastal Economic Zones , NITI Aayog, http://niti.gov.in/content/jobs-growth-and-coastal- economic-zones, accessed on 29 Nov 2017 50 Karnataka Tourism Vision Group Recommendations, Department of Tourism, 2014

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Heritage Tourism Hampi, Badami, Aihole, Pattadakal, Bijapur, Gulbarga, Bidar

Nature Tourism Shimoga, Uttar Kannada, Western Ghats Chickkamagalur, Hassan, Kodagu

Wildlife Tourism Wildlife tourism Nagarhole, Bandipur, BRT, Kavery, Bannerghatta

Wellness Tourism Mysore

Religious Tourism Mookambika, Udupi, Dharmasthala, Karkala, Muradeshwar, Gokama, Shravanabelagola, Gulbarga, Bijapur, Bidar, Ramnagar (Sufi)

Coastal Tourism Mangalore

Table 14: Tourism Clusters – Karnataka Tourism Policy 2015-20

Infrastructure gaps to be fulfilled in order to develop these circuits to tap their full potential include51:

Development and Upgradation of passenger terminals (Road, Rail, Water Transport)

External infrastructure such as water supply, sewerage, drainage, electricity, and

roads

Procurement of equipment for eco-friendly modes of tourist transport

Improvement of road connectivity leading to tourist sites/destinations

Tourism information/interpretation centres with ATMs/money exchange counters

Informational/Directional signage

Wayside amenities with emergency vehicle breakdown, repair, and refuel facilities

Infrastructure provision for stationing of caravan vehicles

Convention centres/golf course/aquamarine parks/amusement parks/theme parks

General improvements such as earth filling, landscaping, water fountains, fencing,

lighting, pavements/walkways/pathways/driveways, seating facilities/shelters,

drinking water points, garbage bins, storm water drainage, treatment facilities for

sewage/effluents

Use of clean energy sources for street lighting

51 Incredible India - Swadesh Darshan , Ministry of Tourism, Government of India, http://tourism.gov.in/sites/default/files/Other/Swadesh%2BBrochure%2B2016%2B-%2BEng%2BWeb_without%2BPM.pdf, accessed on 8 Dec 2017

Corridor Offerings

Integrated Infrastructure Development of Tourism Circuits leading to new

job opportunities and ancillary industrial development

Joint marketing of tourism products – New innovation in tourism product

offerings

Utilizing immense tourism potential of the state to develop tourism

circuits with international standards to increase share of foreign tourists

arrival in the state

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2.4. Good Practices and Emerging trends

In order to devise a robust strategic framework to achieve the vision, it is imperative that we understand the future trends and their impact on current levels of service. KPMG’s Ten Emerging Trends in 201752 report is designed to help decision-makers and investors to understand better the changes flowing through the sector and inform responsible leadership.

The confluence of energy, transportation, and technology sharpens

Over the coming years, governments are expected to look for new ways to align and drive integrated planning across the three sectors. All signs suggest that the sharpening confluence between sectors will lead to a dramatic increase in the demand for energy. The ability of the government, particularly at the city level, to respond to the growing demand across these sectors will underpin economic growth and social harmony.

The benefits of convergence can be seen in the growth of distributed solar energy generation to meet the growing demand for energy-intensive technology and electric transportation.

The populist agenda disrupts infrastructure markets

Over the coming political cycle, it seems clear that infrastructure investment will grow considerably. Infrastructure has been pushed onto centre stage as a form of policy mitigation as governments across the world are staking their reputation on infrastructure. In Asia especially, infrastructure is being lauded as the path to sustainable prosperity.

For example, mobile telephone technology has eliminated the need for fixed lines in many markets, and as seen in India, is leading to the faster adoption of digital solutions.

Understanding consumer behaviour will be the key to infrastructure planning and management

Changes in the way consumers now interact with infrastructure are turning common wisdom on its head. Across the globe, governments are considering how a bevvy of new technologies – renewable generation, energy storage, autonomous vehicles, blockchain, sharing economy, open data and others – will influence future demand for infrastructure.

Across Asia, rising affluence and a rapidly expanding middle class have led to massive demand for air travel. Considering the expectations around customer service levels and the time for the commute, there needs to be an increased focus on easing access to airports, expanding airport capacity and building and rehabilitating related support infrastructure facilities.

Governments are expected to take a more ‘bottom-up’ approach to infrastructure planning and development, taking the time to understand the changing demands of both current users and future generations to help shape their future agendas. A leading initiative to understand these changing demands is the UK’s Mistral-ITRC program.

Investors starting to care about social and environmental impacts, not just financial returns

Over the coming years, it is expected that public and private investors will make serious efforts to communicate the real impact of their investment and projects will be prioritized on their ability to demonstrate stronger social and environmental benefit. As an illustration, consider the debates around pipelines in the US or coal-fired power plants in India. In the short term, the challenge lies in formulating a consistent and appropriate approach to measuring and reporting on social and environmental impacts.

52 Ten emerging trends in 2017 – A global Infrastructure Perspective, KPMG, ,https://assets.kpmg.com/content/dam/kpmg/xx/pdf/2017/01/foresight-emerging-trends-2017.pdf, accessed on 12 Nov 2017

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Technology enables greater infrastructure productivity and increases obsolescence risk

Technology is a fundamental factor affecting how infrastructure projects are planned, designed, developed, and operated. Consider how the falling cost of solar power generation and increasing efficiency of energy storage is changing the dynamics of power generation.

Going forward, an infrastructure CEO will need to think like a technology CEO. The big question is not whether to invest, but when and on which new technologies to invest. For example, a project like the hyper loop project – though audacious – is quickly moving from research to pilot, and this is creating both opportunities and challenges as infrastructure investors try to assess demand for future infrastructure.

At the society level, it is expected that increasingly new technologies will start to gain traction and become increasingly commercialized – driverless cars would be one example worth looking at. But it is at the consumer level where much of the action is as the true value of data and analytics will begin to emerge, helping to improve the capacity, performance, reliability, reduce operational costs, and transform operational performance.

Getting more out of existing infrastructure

Rather than building new capacity to meet ever-higher peak demand, governments at all levels are now thinking of ways to incentivize behaviours that help better manage peak demand. Staggered work days, time-of-day billing, pricing incentives, and regulator measure are just some of the ideas under consideration. France, Belgium, and the UK have all experimented with subsidizing commuters to ride bikes to work as ways of getting more out of their existing infrastructure.

An example worth looking at is the city of Toronto which has adopted multimodal public transport, The pilot program53 integrated a number of mobility features including bicycle storage facilities, a BikeShare station, a car share facility (called AutoShare), a taxi hotline, wireless hotspot, and bicycle and transit route maps. One of the simplest and earliest examples of integrated mobility is Hong Kong’s OctopusCard which linked a variety of public transportation services and fare systems with a single smart card54.

Governments to unlock the funding paradigm

As governments around the world are still struggling to decide how to pay for assets and services that must be delivered, it is expected that there will be a renewed focus on asset recycling, i.e., privatization – selling existing assets in order to help fund the development of new assets. As certain state governments in Australia have demonstrated, it is possible to align opposition from stakeholders with the right messaging.

The biggest funding struggle is with projects where some user pay cash flows exist but not enough to cover the cost of an entire asset across its lifecycle – projects like roads and railways. To fill the funding gap, governments are devising innovative alternative funding sources such as trying to leverage land values to fund the gap or exploring the potential for creating new development taxes.

Credit enhancement facilities go back to basics

There are literally thousands of projects that are being held up by a combination of poor credit ratings and challenging financial markets. Governments and multilateral need to recognize that their choice is to either find a way to work with the private sector or not deliver the project at all. They need to recognize the need to take on more risk at the

53 World Cities Best Practices, Innovation in Transportations, New York City Department of City Planning, https://www1.nyc.gov/assets/planning/download/pdf/plans/transportation/world_cities_full.pdf, accessed on 12 Nov 2017 54 Zielinski, Susan,“New Mobility:The Next Generation of Sustainable Urban Transportation,” The Bridge: Linking Engineering and Society, National Academy of Engineering, Volume 36, Number 4, Winter 2006, p. 33

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early stages of their infrastructure program, recognizing that these risks will be far outweighed by the benefits that new infrastructure brings, particularly in emerging economies.

Credit enhancement facilities should allow private sector equity and debt providers to take on more of these projects knowing that a certain level of risk is being covered. Creating this capability also means improving regulations, strengthening institutions, and creating a market for infrastructure projects.

The search for yield drives convergence in the investment market

The lines between the different types of investors are starting to blur. Financial investors are already recruiting operational team while construction companies and developers are creating investment arms. At the same time, operators are developing financial capabilities, and developers are building up strategic and financial skills.

Consider the example of IDFC who have also developed a project development arm55, taking early positions in some project vehicles. By bringing projects through feasibility, structuring, and presentation to bidders, it generated success/development fees from the winning bidders. The agency invested significant efforts in its early years in policy and regulatory framework changes to facilitate private investment in infrastructure. More bankable infrastructure projects subsequently emerged. IDFC has successfully leveraged the fact that the Government holds an equity stake – without compromising on its commercial orientation.

The globalization of infrastructure continues

Infrastructure players – investors, developers, and operators – have started to expand their global capabilities and transcend national borders. In recent years, this trend has continued, catalysed by rapidly-maturing players from the developing world who have emerged seeking to expand their footprint. Some have been encouraged, supported, or even subsidized by the government ‘outbound’ strategies.

China is a case in point. The country has a massive pipeline of projects, and local operators and investors are rapidly gaining valuable experience. As the government continues to encourage their State Owned Enterprises and private sector to compete in open market tenders, these capabilities are starting to influence international competition.

Essentially, governments are starting to recognize that it is the public sector that needs to energize projects and that, to date, they have relied far too much on the private sector to achieve their economic, social and environmental objectives. The reality is that the private sector is looking for commercial returns, whereas government is seeking to achieve long-term economic benefits and other national objectives. As such, we expect to see governments start to become more active in influencing and catalyzing their infrastructure markets.

2.5. Stakeholder Consultations

The preparation of the Karnataka Vision 2025 has stressed upon the need to consult,

deliberate, include and integrate with the larger citizen community, sector experts, civil

society and other stakeholders to make the exercise participative and responsive.

Incorporating views of diverse sections of the stakeholders involved/ impacted/interested

and integrated in achieving multifold growth of the infrastructure sector of the state has

been fundamental. Towards this end interactions were initiated with all stakeholders for

55 Government support in financing PPS, http://ppp.worldbank.org/public-private-partnership/financing/government-support-subsidies, accessed on 18 Nov 2017

67

getting input /feedback and suggestions for building the vision. Two sets of stakeholder

workshops/consultations were held to elicit inputs for the vision.

i. Sectoral Workshop

ii. District Workshops

Tra

nsp

ort

In

fra

str

uc

ture

Resilient and adequate transport infrastructure along with citizen safety

measures

Land-use transport integration in a

socially cohesive manner.

Enhance connectivity through

metro and rail infrastructure.

Reduction of congestion on roads.

Enhance the capacity of existing

road infrastructure.

Enhancing multimodal connectivity, including urban–rural connectivity.

Ensure quality standards checks are carried out for all roads and bridges in the states

Need to measures to divert truck and bus traffic from main city roads

Awareness campaigns on traffic

rules.

Ensuring pedestrian safety.

Use of new technologies in road

construction.

Alternate fuels.

Trauma centres along highways.

Use of GPS and ITES in

increasing the efficiency of public

transport and passenger safety.

Mandating creation of pedestrian

footpaths and cycle tracks with

side rails according to

international standards along all

roads

La

rge i

nfr

as

tru

ctu

re

Infrastructure, which enhances connectivity and socio-economic

wellbeing

Construction of airports in every

district with helipads at taluk level.

Expansion of airport runways

Doubling of railway tracks along

important routes.

Sky-walkers/walkways/Under-

passes connecting city centres to

Shopping-cum-IT offices,

hospitals, super-specialty

hospitals

Rail network connectivity to airport

– Bullet trains, Metro etc.

Establishing skill development

and incubation centres for

innovative infrastructure

solutions

All utility services like electricity,

water supply and drainage lines

should be shifted to

underground ducts on either

side of roads.

Inte

r-c

on

ne

cte

d I

nfr

astr

uctu

re

Corridor development to pave way for increased trade relations

Construction of flyovers and

elevated corridors at all major city

junctions and up-gradation of

outer ring roads to six-lane

corridors

Developing Inter-city train

connectivity

National Highway corridor

development to enhance

industrial, tourism and agriculture

sectors

Metro corridors

Developing tourism corridors

connecting important and

potential tourist destinations in the

state

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G

ov

ern

an

ce

Investor friendly Governance Measures

Government to create a PPP

policy in order to boost the

infrastructure sector taking

adequate initiatives to mitigate the

myriad issues faced by the sector

in lieu of existing Infrastructure

Policy

Need to address both statutory

and structural problems in various

urban sectors including overall

urban planning practices. This

would include revision of old acts

and policies, as well as altering

hiring policies in urban sector

organisations

Need for incremental shift in

tracking better applicable

indicators to measure sector

performance

Capacity building of organisations

and convergence of programmes

to ensure success of existing

programmes

Need for a data-sharing policy,

private/independent data

collection set-up, inter-operability

of databases and departmental

coordination for planning,

monitoring and implementation of

infrastructure projects

Data-mapping and making

correlation between different

data-sets can give vital clues in

efficient decision making during

planning process

Table 15 Recommendations derived from Stakeholder Consultations

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3. Vision 2025 for Infrastructure sector

3.1. Vision statement for Infrastructure sector in Karnataka

To ensure safe, reliable and environmentally sustainable last mile connectivity across Karnataka in order to achieve increased socio-economic development of

the state

3.2. Goals and Strategies for 2025

# Goal Targets Strategy

1 Enhance regional connectivity of roads ensuring first and last mile connectivity to all villages

1. At least 50% of SH roads are upgraded to Two lane roads

2. At least 50% of MDR are upgraded to Intermediate lane roads

3. 100% conversion of metal/earthen MDR to all-weather roads

4. Ensure quality road infrastructure across coastal belt

5. Ensure all-weather road connectivity to all habitations

6. 50% of all arterial roads in Bengaluru to be converted to TenderSURE roads

1. All-weather roads connectivity to all habitations

2. Upgradation of Intermediate and Major District Roads

3. Fast-track implementation of state-wide road infrastructure maintenance

4. Road Grid connecting Bus-Rail-Air modes of transport

2 Develop robust airport and airstrip infrastructure in the state

1. Increase passenger capacity of airports in the state to 45 million

2. Enhance district-wise helicopter service network in the state

1. Sustainable regional/minor airport development model

2. Air infrastructure development and upgradation – Airports and Helipads

3 Augment rail connectivity across the state to deliver a seamless, accessible, multimodal, and secure transport offering

1. Increase state-wide average of kilometres of track available per lakh of population by 1%

2. 100% upgradation of all A1 category railway stations to international standards

1. Fast-track development of Railway Tracks

2. Smart Infrastructure up-gradation of railway stations

3. Dedicated freight corridors connecting to BMEC

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# Goal Targets Strategy

3. Increase rail electrification in the state to 22%

4 Develop quality port infrastructure and promote coastal shipping

1. Formulate a maritime board for the state and enhance port-led development in the state

2. Implement latest technologies in upgradation of ports and waterways in order to increase current utilization % of ports

1. Minor Port Development Program

2. Getting Maritime Board into action

5 Develop Corridor Infrastructure to augment cross-sector potential of the state

1. At least 2 state waterways are equipped with tourism support infrastructure

2. Initiate corridor development activities under proposed BMEC and CBIC

1. Inter-state corridor

2. Intra-state corridor

3. Tourism corridor

4. Innovation and Technology Corridor

6 Attract large investments in infrastructure sector

1. At least 50% of PPP-ready projects are implemented

2. Explore innovative means of financing for large infrastructure projects

3. 3-level capacity enhancement programs for department staff dealing with Infrastructure assets.

4. Achieve 80% response rate under grievance redressal portal for public infrastructure assets

1. Database of PPP-ready projects

2. Effective management of PPP Infrastructure projects

3. Capacity building of people, technology and governance

4. Stakeholder engagement portal – Stakeholder queries and grievance redressal portal

7 Improve accessibility and efficiency of bus public transportation system

1. Increase capacity and quality of service of bus public transport system in the state

2. Increase bus public transport coverage to all villages

1. Bus Public Transport Service Enhancement Plan

2. Introduce shorter distance in city peak hour bus services

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# Goal Targets Strategy

3. Reduce congestion due to bus traffic in urban centres

Table 16 Vision 2025 - List of Goals and Strategies for Infrastructure sector in Karnataka

Goal 1 - Enhance regional connectivity of roads ensuring first and last mile connectivity to all villages

Target 1 - At least 50% of SH roads are upgraded to Two lane roads

Target 2 - At least 50% of MDR are upgraded to Intermediate lane roads

Target 3 - 100% conversion of metal/earthen MDR to all-weather roads

Target 4 - Ensure quality road infrastructure across coastal belt

Target 5 - Ensure all-weather road connectivity to all habitations56

Target 6 - 50% of all arterial roads in Bengaluru to be converted to TenderSURE roads

Strategy 1 – All-weather roads connectivity to all habitations

Enhance implementation of all-weather road projects under PMGSYM, NGNRY and NABARD schemes for connecting remaining unconnected habitations of population less than 500. Expedite coordination with respective departments for adequate and timely fund transfer under respective schemes and monitoring development of rural road projects to avoid time and cost overruns

Ensuring quality assurance in all roads constructed and upgraded; and execution capacity of designated authorities under PMGSY.

Alignment with current programs and Budget

Pradhan Mantri Gram Sadak Yojana (PMGSY)

Rural road management policy to be implemented as per NRRDA guidelines.

INR 100 crores allocated for development of 25 kms of rural roads in each rural legislative assembly constituency under “Namma Hola Namma Dari” scheme

Allocation of INR 1765 Cr for development of 4386 kms roads under “Namma Grama Namma Raste”- Phase 4

Strategy 2 - Upgradation of Intermediate and Major District Roads

Delineating a full-fledged upgradation plan for intermediate and major district roads with projects identified over a time-span of 10 years, budget estimated, allocated budget, the projected start date of construction, an evaluated list of potential EPC to execute the projects etc. Upgradation projects to be equipped with placeholders for utility infrastructure and drainage facilities

56 The unit for connectivity of all-weather roads is “habitation” having less than 500 population or minimum 20 families

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Strategy 3 – Fast-track implementation of state-wide road infrastructure up-gradation and maintenance

Create a single coordinated database for integrated management of all types of road and bridge infrastructure assets (national, regional, district, village/taluk) which will help in coordinated planning and project implementation that stipulates clear links to budgets and requires coordination and negotiation between agencies of land use, transportation, infrastructure service provision and economic development. IDD to drive development of this database.

Introducing technology driven maintenance programs for roads to shift from current infrastructure inspection systems which are mainly based on reports drafted by technicians, which is time-consuming and likely to be prone to human errors, especially for large infrastructure projects. Application of modern technologies to manage and maintain infrastructure projects can help to build a sustainable infrastructure service model in the state. Planning and Road Asset Management Centre (PRAMC) can drive this initiative along with committee members from PWD and IDD. Few ICT driven technologies and its applications are listed below:

o Geographic Information System (GIS) is a system designed to capture, store, manipulate, analyse, manage, and present spatial data. For infrastructure projects, GIS provides the location of assets and information about topography and relation between objects. They are the foundation for location-based services that rely on analysis and visualisation.

o Application of terrestrial LiDAR (Light Detection and Ranging), a remote sensing technology, for bridge health monitoring is a well-studied use case and implemented by transportation departments in many countries. Panoramic high resolution georeferenced colourised point clouds from LiDAR scans can provide detailed information about a bridge. These can be further integrated with systems like GIS to provide more significant insights and achieve in a matter of days and with higher accuracy monitoring and decision-making work what would have traditionally taken a team of professionals weeks to accomplish.

o Drones and Unmanned Aerial Vehicles (UAVs) can be used to supervise and monitor ongoing infrastructure projects, manage the maintenance of existing infrastructure, handle tasks in hazardous areas and conduct asset inventories. UAVs are vital in generating structural and geospatial models of infrastructure using technologies such as GPS, GIS, 360-degree imaging, and LiDAR scanning.

TenderSURE road program – Encourage coverage of TenderSURE road up-gradation for all arterial roads in Bengaluru in the first phase and upon completion enhance state-wide program to cover other cities

Alignment with current programs and Budget

Infrastructure Policy

PRAMC

BBMP City Road Upgradation Policy – Budget allocation of ~ INR 2400 Cr for development and maintenance of high traffic density corridors, comprehensive upgradation of interconnected roads under Tender sure model, white topping and improved pedestrian facilities, developing footpaths, ROB and RUB construction, construction of stormwater drains, traffic engineering works, skywalk construction etc.

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Strategy 4 - Road Grid connecting Bus-Rail-Air modes of transport

Driving synchronization of different modes of transport – Bus stations/terminals/bays, railway stations, airports and metro stations by creating a road grid connectivity plan by mapping existing road connectivity to railway stations, airports, bus stations and metro stations and phase out the plan to ensure seamless connectivity of all modes of transport by roads within 10-20 km radius

Develop multi-modal transport hubs under one roof in Bengaluru, Belgaum, Hubli, Mangalore and Mysore

Alignment with current programs and Budget

National Transport Master Plan

National Rail Plan 2030

Budget allocation for development of Hoskote-Budigere-Mylenahalli-Devanahalli International airport road through KRDCL

Budget allocation of INR 50 Cr for development of 2.50 Km road on Mangalore-Athradi State Highway connecting Mangalore International Airport

Goal 2 - Develop robust airport/airstrip infrastructure in the state

Target 1 – Increase passenger capacity of airports to 45 million

Target 2 – Enhance district-wise helicopter service network in the state

Strategy 1 – Sustainable regional airport development model

Constitute a Regional Airline Development Board to conduct planning of development of airstrips and regional airports under UDAN scheme and PPP, derive incentives and innovative business models to attract private players, conduct air demand modelling, host consumer awareness programs to induce customer demand for air travel options between district

Develop an Air Cargo Growth Strategy for regional airports under which road feeder services could be introduced to regional airports. This can redirect heavy cargo truck traffic from city limits and reduce congestion in urban areas

Develop city-side infrastructure at regional/minor airports across the state in PPP

mode with the help of private players for the building of hotels, car parks and other

facilities which will thereby boost its non-aeronautical revenues.

Alignment with current programs and Budget

UDAN Scheme

Karnataka Aerospace Policy 2013-2023

Budget 2016-17 constitutes development of airstrips at Chickmagalur, Karwar and Madikeri

Strategy 2 - Air infrastructure development and upgradation – Airports and Helipads

Develop an International Airport Expansion Plan for KIAL and Mangaluru Airport which will include runway expansion, terminal expansion, terminal modernization with

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world-class amenities, expansion in dedicated cargo terminals, airport SEZ etc. to cater to global tourist footfall demand of 2025 and global business arrivals and trade.

Develop a Helicopter Service Network to connect major business centres across Karnataka with Bengaluru and Mysuru as hubs with 4 circuits connecting 15 districts in the first phase of the project. Private fleet operators can conduct their operations

through these heliports and helipads. These can be developed in connection with existing and proposed airports/airstrips

Alignment with current programs and Budget

Karnataka Aerospace Policy 2013-23

Budget highlights constituting of following projects

o Development of the second runway to reduce congestion in Kempegowda International Airport, Bengaluru.

o Development of 2nd terminal at Kempegowda International Airport to be taken up

o Submission of proposal to GoI for the expansion of Mangalore airport including acquisition of 286 acres of land

Goal 3 - Augment Rail connectivity across the state

Target 1 – Increase state-wide average of kilometres of track available per lakh of population by 1%

Target 2 – 100% upgradation of all A1 category railway stations to international standards

Strategy 1 - Fast-track development of Railway Tracks

Develop a detailed rail infrastructure plan for the state with an aim to promote the regional development of railway infrastructure and fast-track development of ongoing and proposed projects. IDD (GoK) to aegis development of the plan (which shall be a renewal of 2009 Infrastructure plan) along with Karnataka Rail Infrastructure Development Enterprise (KRIDE).

KRIDE to develop an online project monitoring portal to track the progress of ongoing and proposed rail infrastructure projects and constitute a specific committee to fast-track land acquisition and clearances for timely execution of these projects.

Alignment with current programs and Budget

Setu Bharatam

Karnataka Rail Infrastructure Plan 2009

National Rail Plan 2030

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Strategy 2 – Smart Infrastructure up-gradation of all railway stations

Build smart infrastructure facilities in A1 category railway stations with facilities at par with international standards57 with modern facilities and passenger amenities by leveraging commercial development of land and airspace in and around the station such as executive waiting lounges, escalators, commercial spaces, etc. through PPP model deploying innovative cost recovery models through multiple non-ticketing revenue streams

Basic objectives of station infrastructure upgradation to serve objective of improving Access, Circulation, Lighting, Advertising, Architectural Details and Finishes, Station Furniture and Facilities, Variable elements (Main station entrance, Intermodal access/egress points, landscaping around stations), Color and Communication

Ensuring connectivity by roads to all railway stations and adequate parking spaces

Development of Safety Infrastructure along all Railway routes through a dedicated railway safety state fund – RoB, RoU, Signalling and train control equipment, deploying advanced technologies to prevent derailment

Alignment with current programs and Budget

Railway Infrastructure Plan 2009 (Karnataka)

Development of World Class Stations Through PPP Manual for Standards and Specifications, Ministry of Railways

Karnataka Infrastructure Policy 2007 (amended till 2015)

Swachh Railway Stations - Swachh Bharat Urban

Indian Railway’s Station Redevelopment Programme

Expert Group for 'Modernization of Indian Railways

Railway Board PPP Cell – Indian Railways

Strategy 3 - Dedicated Freight corridors connecting to BMEC

Creation of a Dedicated Freight Corridor (DFC) with Goods trains that run at a higher

average speed up from the existing 25 kmph58, allowing faster servicing, more

turnarounds, enhancing performance and safety.

In phase I, corridors can be created to connect with the larger BMEC project through

the ports at Mangaluru, Karwar, and Tadri on the western coast.

Ensuring all lines connecting to BMEC are broad gauge and fully electrified in to

ensure compatibility with planned infrastructure.

Freight consolidation centre, junctions and switching facilities to be provisioned in

Mumbai to allow switching from BMEC to Western DFC. Freight consolidation centre

near Bengaluru and other significant junctions such as Mangaluru and Yadgir

Institutionalizing an SPV for identification, construction, management, and revenue

collection from freight corridor

57 Development of World Class Stations Through PPP Manual for Standards and Specifications, Ministry of Railways, June 2009 58 Dedicated Freight Corridor to be complete by 2019, November 2016, https://www.ndtv.com/india-news/dedicated-freight-corridor-to-be-complete-by-2019-indian-railways-1624331, accessed on 21 Nov 2017

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Alignment with current programs and Budget

Sagarmala

Logistics Efficiency Enhancement Program (LEEP)

Bangalore Mumbai Economic Corridor

Chennai Bangalore Economic Corridor

Feasibility study on development of Hyperloop corridors across the state

Western Dedicated Freight Corridor

National Rail Plan 2030

Goal 4 - Develop quality port infrastructure and promote coastal shipping

Target 1 – Formulate a maritime board for the state and enhance port-led development in the state

Target 2 – Implement latest technologies in upgradation of ports and waterways in order to increase current utilization % of ports

Strategy 1 – Getting Maritime Board into action

Form a maritime board in the state to develop quality maritime infrastructure in the state in line with international standards to enhance the maritime potential of the state. The key objectives to be served by the board include the following but not limited to:

o To enhance existing port utilization and traffic

o Derive maximum benefits from existing coastal shipping routes

o Encourage ancillary port-driven development

o Develop adequate infrastructure support and services to promote private participation and investments in the sector

o Implement latest technologies in port development

o Preserve environmental considerations safeguarding coastal population

o To develop a coastal economic zone to direct benefits of maritime development to the economic development of the region and state at large

Alignment with current programs and Budget

Karnataka Maritime Board Act 2015

Strategy 2 - Minor Port and Coastal Shipping Development Program

Institutionalize initiatives under Karnataka Minor Ports Development Policy of 2014 to develop adequate infrastructure in existing minor ports to attract more cargo traffic to these ports increasing utilization % of existing ports

Expansion, modernization, and upgradation including construction of new berths and terminals, mechanization of existing berths and terminals

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Skill development program for port staff and officials to adopt with latest technologies and facilities in ports

Equipping 2 state waterways with tourism support infrastructure to promote coastal tourism in the region

Deployment of latest technologies to convert seasonal waterways to all-year-round waterways for coastal shipping of large ships, Ro-Ro ships etc.

Alignment with current programs and Budget

Karnataka Minor Ports Development Policy of 2014

Development of Tadadi port under PPP model

Sagarmala Coastal Berth Scheme - Government of Karnataka allocated with INR 50 Crore for developing Breakwater at Karwar Port

Goal 5 - Develop Corridor Infrastructure to augment cross-sector potential of the state

Target 1 - At least 2 state waterways are equipped with tourism support infrastructure

Target 2 - Initiate corridor development activities under proposed BMEC and CBIC

Strategy 1 - Inter-state corridor

Fast track development of Bengaluru Mumbai Economic Corridor and Chennai

Bengaluru Industrial Corridor – Constitute a committee to monitor current projects that fall under the perspective plan of the corridor projects of DIPP

Strategy 2 - Intra-state corridor

Revisit and fast-track planning and development of proposed Suvarna Karnataka Development Corridor Programme in phases constituting development of a transportation corridor, logistics corridor and industrial corridor development basis potential clusters operating in the delineated regions

Capacity-building to support business growth, job creation and social equity to synchronize diverse residential areas, commercial corridors and industrial districts within the intra-state renewal area

Institutionalise the participation of key stakeholders and citizens at district level to align key development plans in line with regional strengths to ensure sound economic development and job opportunities at varied skill levels

Alignment with current programs and Budget

Bangalore–Mysore Infrastructure Corridor

Strategy 2 - Tourism corridor

Identification and assessment of thematic tourism clusters and formulate a suitable development approach outlining the strategic recommendations, guidelines and infrastructure requirement at the identified tourism circuit

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Develop tourism support infrastructure for coastal and wildlife tourism concepts

Alignment with current programs and Budget

Karnataka Tourism Policy

Swadesh Darshan

National Mission on Pilgrimage Rejuvenation and Spiritual Augmentation Drive (PRASAD)

Heritage City Development and Augmentation Yojna (HRIDAY) scheme

To popularize wilderness tourism and eco-trails across the State, 2017 has been declared as the ‘Year of the Wild’

Allocation of INR 385 crores for development of tourism infrastructure

o Integrated development of Heritage Tourism infrastructure

o Setting up of ‘Belli Shrunga’ from Karwar to Vijayapur, from Belagavi to Ballari and from Bidar to Koppal for rejuvenation of historical places of north Karnataka

o Construction of an Aero Sports Hub in Mysuru

Hampi and Anegundi in Karnataka are a part of the Ramayana Circuit – Ministry of Tourism has sanctioned INR 32.8 crore to develop the surroundings of the Hampi world heritage site

Cauvery Tourism Development Authority (CTDA) has identified three tourist circuits to promote tourism in the Cauvery basin. The circuits are Malai Mahadeshwara Tourist Circuit, Kodagu Tourist Circuit and Chamarajanagar Tourist Circuit59.

Golden Chariot Train- Luxury train operating in South India operating two circuits –

Pride of the South Circuit that covers destinations in Karnataka and Goa, and

Southern Splendour Circuit which covers Karnataka, Kerala, and Tamil Nadu.

Strategy 4 – Innovation and Technology Corridor

Two such corridors can be developed in Karnataka – Bengaluru-Mysuru Corridor and Hubballi-Dharwad to Belgaum. These corridors build innovation capacity for not just the IT-BT or Healthcare but for all focus industries for Karnataka including agriculture, aerospace, automobiles, food processing and textiles to name but a few.

A productive collaboration between government, businesses, policy-makers, investors and academia to foster winning companies and nurture the nascent stages to form a strong supercluster.

Creation of sufficient infrastructure to connect the urban centres in the corridor, mainly via traditional commuter rail and highways, to facilitate access between residents of different cities. There needs to be a formal coordinating body to build strategy and cohesiveness within the corridor to ensure needs for connectivity are fulfilled.

A concerted effort with leadership across public and private sectors to address persistent structural and capital gaps and undertake initiatives that promote connectivity and scale.

59 Three tourist circuits identified to increase footfall in Cauvery Basin, The Hindu, June 2015, http://www.thehindu.com/news/cities/bangalore/three-tourist-circuits-identified-to-increase-footfall-in-cauvery-basin/article7358679.ece, accessed on 03 Dec 2017

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Goal 6 - Attract large investments in infrastructure sector

Target 1 - At least 50% of PPP-ready projects are implemented

Target 2 - Explore innovative means of financing for large infrastructure projects

Target 3 - 3-level capacity enhancement programs for department staff dealing with Infrastructure assets.

Target 4 - Achieve 80% response rate under grievance redressal portal for public infrastructure assets

Strategy 1 - Database of PPP-ready projects

Develop a database of PPP-ready projects which have requisite statutory approvals in place and associated land acquisition or availability details. PPP process can be initiated for these projects. PPP cell of IDD to aegis development of this database

Strengthen accountability and coordination of departments to comply with the Ease of Doing Business reforms agenda

Identifying and eliminate redundant acts/rules, clearances/procedures issued by departments

Investment Promotion and Facilitation Cell to be constituted at State and District level under the aegis of IDD/PPP Cell

Publishing of Standard Operating Procedures for clearances of concerned Departments / Agencies

Statewide implementation of an Intelligent Building Plan Management System

Alignment with current programs and Budget

Business Reforms Action Plan – DIPP

Strategy 2 – Effective management of PPP infrastructure projects

Restructuring PPP contracts through an objective process, broadening and

deepening access to long-term credit and tightening procurement processes and

timelines. Build a strong risk assessment framework to foresee factors that would

significantly impact performance over a long-term contract period, recognition of

which is key attract long-term investment on the scale required and ensure smooth

contract operations.

Create a “PPP Fast Track” wing to reduce the time frame for financial close of the

project and resolve disputes during the implementation stage quickly which are big

deterrents for foreign investors and tends to weaken the competition as well

Ensure that government procurement processes maximize opportunities for local

industry participation in infrastructure projects

Alignment with current programs and Budget

Karnataka Infrastructure Policy

Invest Karnataka

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Strategy 3 - Capacity building of people, technology and governance

Build capacity of IDD officials through mandatory training and education programs to ensure efficient planning, coordination, implementation and evaluation of Infrastructure projects.

Strengthen service delivery and efficiency of various transport modes by expanding the technical human resource and fiscal capacity

Training opportunities for owners and operators of critical infrastructure in risk management and maintenance of valued assets

Constitute “SMART RESEARCH GROUPS”60 for Road, Rail, Air and Port Infrastructure with focus on providing world-class, practical and actionable knowledge on infrastructure policy, facilitate better infrastructure planning and management, building models for Infrastructure service providers that enhance understanding and appreciation of passenger and freight customer behaviour

Alignment with current programs and Budget

Training program in PPP – IDD

PPP Capacity Building Workshop

Strategy 4 - Stakeholder engagement portal – Stakeholder queries and grievance redressal portal

Enhance grievance redressal mechanism of all departments associated with infrastructure development through a stakeholder engagement portal which is not only accessible for grievances alone but one which can be accessed by all associated stakeholders (Departments, EPC contractors, Maintenance contractors, prospective investors, etc.). Aim is to drive synergy across multiple stakeholders and introduce a participative approach in driving infra development in the state

Goal 7 – Improve accessibility and efficiency of bus public transportation system

Target 1 - Increase capacity and quality of service of bus public transport system in the state

Target 2 - Increase bus public transport coverage to all villages

Target 3 - Reduce congestion due to bus traffic in urban centers

Strategy 1 - Bus Public Transport Service Enhancement Plan

Develop a service enhancement plan for KSRTC and associated entities with a key objective to expand bus capacity, provide better bus services and better connectivity with a focus on the quality of service.

The plan shall constitute operation guidelines/standards for:

60 Infrastructure Research and training , University of Wollongong, Australia, https://smart.uow.edu.au/content/groups/public/@web/@smart/documents/doc/uow186992.pdf, accessed on 12 Dec 2017

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o Reliability (Scheduled trips, breakdown, service delay)

o Loading Limits

o Safety

Service guidelines/standards for:

o Information availability

o Access to bus service

o Direct bus connections

o Operating hours and frequencies

o Integration with other modes of transport

Strategy 2 - Introduce shorter distance in city peak hour bus services

Evaluate the feasibility of operating short-distance bus services in order to reduce traffic congestion and over-loading of buses during peak hours.

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3.3. Implementation Roadmap

Goal Targets Suggested KPI’s 2017 2022 2025

Enhance regional connectivity of roads ensuring first and last mile connectivity to all villages

At least 50% of SH roads are upgraded to Two lane roads

At least 50% of MDR are upgraded to Intermediate lane roads

Length of 2 lane roads - NH, SH and MDR

8606 9411 12898

Length of intermediate lane roads

20459 24704 40429

100% conversion of metal/earthen MDR to all-weather roads

Length of metal/earthen MDR to be converted to asphalted/all-weather roads

2000 750 0

Ensure quality road infrastructure across coastal belt

% conversion of coastal belt roads to Cement Concrete roads

- 70% 90%

Ensure all-weather road connectivity to all villages

Length of all-weather rural roads* (* rural roads connected to habitations and marketplaces)

67742 99097 12000

0

50% of all arterial roads in Bengaluru to be converted to TenderSURE roads

Length of Tender SURE Roads in Bangalore

16 40 103.5

Develop robust airport infrastructure in the state

Increase passenger capacity of airports to 45 million

Per million access to a runway

0.90 1.55 1.95

Total No. of Airports 6 10 14

No. of operational runways in international airports

2 3 4

Enhance district-wise helicopter service network in the state

No. of helicopter service stations

- 6 12

Augment rail connectivity across the state to

Increase state-wide average of kilometres of track available per lakh

Average kilometres of track available per lakh of population

4.87 5.46 5.56

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Goal Targets Suggested KPI’s 2017 2022 2025

deliver a seamless, accessible, multimodal, and secure transport offering

of population by 1%

100% upgradation of all A1 category railway stations to international standards

No. of A1 railway stations upgraded to international standards

- 2 3

Increase rail electrification in the state to 22%

% rail electrification 19% 22% 23%

Develop quality port infrastructure and promote coastal shipping

Formulate a maritime board for the state and enhance port-led development in the state

No. of All-weather ports

2 3 5

Implement latest technologies in upgradation of ports in order to increase current utilization % of ports

Minor Port Traffic YOY Growth %

6% 8% 8%

% achievement of Maritime Board Goals

- 50% 70%

Develop Corridor Infrastructure to augment cross-sector potential of the state

At least 2 state waterways are equipped with tourism support infrastructure

No. of port-led tourism development projects

- 5 8

Development of perspective plan for Karwar-based Industrial corridor

Fast track development of Bengaluru Mumbai Economic Corridor and Chennai Bengaluru Industrial Corridor

% completion of corridor-based infrastructure projects* (Undertaken by state government)

- 25% 50%

% of industrial clusters with connectivity to corridors

Attract large investments in

At least 50% of PPP-ready projects are implemented

% PPP-ready projects in development stage

- 20% 25%

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Goal Targets Suggested KPI’s 2017 2022 2025

infrastructure sector

3-level capacity enhancement programs for department staff dealing with Infrastructure assets.

No. of mandatory training programs launched

- 2 5

Achieve 80% response rate under grievance redressal portal for public infrastructure assets

Improve efficiency and accessibility of bus public transportation system

Increase capacity and quality of service of bus public transport system in the state

% Daily Transported Passenger/Population* *(Population of age > 5 years)

19% 22% 25%

Increase bus public transport coverage to all villages

% bus service coverage to all villages

91% 93% 94%

Reduce congestion due to bus traffic in urban centres

Annexures Annexure I – Details of various Institutions functioning in Karnataka Infrastructure sector

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S No.

Institution Role/Objective Types of Projects undertaken

1

National Institution for Transforming India (NITI Aayog)

NITI Aayog is the premier policy ‘Think Tank’ of the Government of India, providing both directional and policy inputs. While designing strategic and long term policies and programmes for the Government of India, NITI Aayog also provides relevant technical advice to the Centre and States.

At the core of NITI Aayog’s creation are two hubs –

Team India Hub which leads the engagement of states with the Central government

Knowledge Innovation Hub which builds NITI’s think-tank capabilities

NITI Aayog is also developing itself as a State of the Art Resource Centre, with the necessary resources, knowledge and skills, that will enable it to act with speed, promote research and innovation, provide strategic policy vision for the government, and deal with contingent issues.

2 Infrastructure Development Department (IDD)

The Infrastructure Development Department (IDD) is established to play a significant role in the areas of developing air, rail, and maritime connectivity for the state and in promoting increased private investment in public infrastructure through Public Private Partnership (PPP).

IDD associates with all types of public infrastructure projects more particularly in the areas of Railways, Ports and Airports. Significant projects undertaken by IDD include61

Development of Hasan Mangalore rail line in partnership with K-RIDE

Equity participation and infrastructure support for Bangalore International Airport Limited through KSIIDC

Putting up a gas pipeline project in association with GAIL

Putting up Airstrips in 10 districts of Karnataka

Expansion of AAI run airports in Mangalore, Mysore, Belgaum, and Hubballi

Development of airports in Bidar, Gulbarga, Bijapur, Bellary, Shimoga, and Hassan under PPP

The IDD has a PPP Cell which is the nodal agency to receive proposals for PPP projects. Additionally, it also helps various state departments and agencies in different stages of the project development cycle.

61 Objectives of IDD, Infrastructure Development Department, Government of Karnataka, http://www.iddkarnataka.gov.in/objectives.html, accessed on 10 Nov 2017

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S No.

Institution Role/Objective Types of Projects undertaken

3 Infrastructure Development Corporation (Karnataka) Ltd (iDeCK)

iDeCK is a joint venture between the Government of Karnataka, Infrastructure Development Finance Company (IDFC), and Housing Development Finance Corporation Limited (HDFC).

iDeCK works closely with government departments and agencies as well as private sector clients across the globe for development of infrastructure in transportation, tourism, urban development, industries, and renewable energy.

Services offered by iDeCK include62 –

Infrastructure Consulting including project conceptualization and planning, strategy and business planning, technical and financial feasibility studies, designing project contracts, and post-award services

Financial Advisory including assessment of commercial viability, municipal finances, and project financing requirements

Project Investments through a Project Development and Infrastructure Fund

Enablement Services including strategy and policy advisory, program management, and capacity building

iDeCK also provides technical advice and support to the PPP Cell of the IDD.

4 Karnataka State Industrial & Infrastructure Development Corporation Limited (KSIIDC)

KSIIDC is a wholly owned undertaking of GoK. Key objectives are as follows63 –

Act as a catalyst for promoting industrial growth in the state, especially in the medium and large sector

To act as the designated agency of the Government to plan and formulate proposals for industrial infrastructure development projects after assessing needs in different sectors/areas and to monitor the specified mega projects during

The spectrum of activities undertaken by KSIIDC spans the following areas –

Presently, KSIIDC is involved with recovery of pending loan portfolios as well as major infrastructure projects taken up on a PPP basis such as development of sea port at Tadadi and the Bangalore Signature Business Park near BIA.

Plan and formulate proposals for infrastructure development projects like industrial parks and townships, industrial growth centres, airports (international and minor), and sea ports

Acting as a state level development finance institute.

Performing promotional activities for growth of industries in the state

Joint venture with ILFS for providing consulting and

62 Ideas for a better future, Infrastructure Development Corporation Limited, http://ideck.in/#services, accessed on 10 Nov 2017 63 Council Of State Industrial Development and Investment Corporations Of India, http://www.cosidici.com/11/main.html, accessed on 10 Nov 2017

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S No.

Institution Role/Objective Types of Projects undertaken

implementation as the nodal agencies

advisory services, and with GAIL for city gas distribution project.

5 Karnataka State Financial Corporation (KSFC)

The focus of KSFC has been on the small scale sector, tiny units, and disadvantaged groups. It has been the main lending institution in most districts for entrepreneurs. Since its establishment it has provided assistance to 1, 71,414 units amounting to over INR 15,000 crore.

Provide loan assistance for construction and infrastructure related activities64 such as –

Infrastructure projects including flyovers, bridges etc. and construction, development and maintenance of roads.

Establishing commercial complexes, residential apartments

Development of residential layouts, group housing, industrial estates, software parks, godowns, warehouses

Acquisition of ready built offices/new office building, sales outlets/showrooms

6 Ministry of Road Transport & Highways (MoRTH)

MoRTH is an apex organization under the Central Government entrusted with the task of formulating and administering, policies for Road Transport, National Highways and Transport Research with a view to increasing the mobility and efficiency of the Road Transport system in the country. It works in consultation with other Central Ministries/Departments, State Governments/UT Administrations, organizations and individuals

Roads Wing which deals with the development and maintenance of National Highways in the country o Planning, development and

maintenance of National Highways in the country

o Extends technical and financial support to State Governments for development of state roads and the roads of inter-state connectivity

o Evolves standard specifications for roads and bridges in the country

o Serves as a repository of technical knowledge on roads and bridges

Transport Wing activities include: o Legislation, administration,

taxation, insurance and other activities related to motor vehicles

o Promotion of Transport co-operatives in the field of motor transport

64 Activities Eligible for Term Loan Assistance, KSFC, http://ksfc.in/KSFCWebPortal/ActivitiesEligible.jsp?msg=1, accessed on 10 Nov 2017

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S No.

Institution Role/Objective Types of Projects undertaken

o Evolves road safety standards in the form of a National Policy on Road Safety and by preparing and Annual Road Safety Plan

7 National Highways Authority of India (NHAI)

NHAI is responsible for the development, maintenance and management of National Highways entrusted to it and for matters connected or incidental thereto.

NHAI is mandated to implement National Highways Development Project (NHDP), aimed at creating a world class arterial road infrastructure for the country with uninterrupted traffic flow. NHDP projects have been approved in 7 phases until now. The main programs under NHDP are65 –

The Golden Quadrilateral connecting Delhi-Kolkata-Chennai-Mumbai

The North-South Corridor connecting Kashmir to Kanyakumari including Salem to Cochin spur

The East-West Corridor connecting Silchar to Porbandar

Port Connectivity

Special Accelerated Road Development Programme in North-East

In addition to this, NHAI has also taken on other projects for maintenance, upgradation, and enhancement of existing National Highways road infrastructure

8 Karnataka Public Works, Ports, & Inland Water Transport Department (PWP&IWTD)

Responsible for road works including maintenance on National Highways, State Highways and Major District Roads and construction & maintenance of Government Buildings. It also undertakes construction on behalf of other department under the Deposit Contribution Works

Projects of PWP&IWTD can be broadly falls under the following categories –

Construction and maintenance of buildings, including most Government buildings

Maintenance and development of National Highways, State Highways, and major district roads

Maintenance and development of flyovers and bridges

65 NHAI- Mandate, National Highway Authority of India , Ministry of road transport and highways government of India, http://www.nhai.org/mandate.htm, accessed on 10 Nov 2017

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S No.

Institution Role/Objective Types of Projects undertaken

Maintenance and development of CD Works

Maintenance and development of ports

9 Karnataka Road Development Corporation Limited (KRDCL)

KRDCL is a company under the PWP&IWTD established to promote surface infrastructure by taking up road works, bridges etc., and to improve road network by taking up construction, widening, and strengthening of roads, construction of bridges, maintenance of roads etc.

KRDCL has taken up widening and upgradation of state highways for a length of 1055 km, of which 601 km has already been completed66

Construction/reconstruction of bridges on state highways and municipal roads, state highway maintenance projects, and are also administering some of the improvement works to the roads being executed by PWD.

10 Karnataka State Highways Traffic and Transport Authority (KSHTTA)

Under Karnataka Road Sector Policy (KSRP)–2009, KSHTTA was envisaged as an apex body empowered to undertake the planning and regulatory functions in the road sector.

KSHTTA in its newly envisaged role of executive body for the road sector would undertake the following activities –

To provide the link between policy and implementation

To act as a nodal agency for all the planning and regulatory functions related to the CRN

To act as single window agency to facilitate obtaining necessary clearances for road improvement projects from other Ministers either State or Central.

To work as Executive Committee for operationalization of Road Fund.

To monitor the tolling policy and setting users charges.

To act as a facilitator for implementing of PPP projects in Road sector and finalization of contractual structure particularly in matters of tariff.

To work as a Road Safety Authority with concern for policy, Strategy and Implementation.

To own and maintain a Road Information System (RIS) and

66 Roads, Karnataka Road Development Corporation Ltd, http://www.krdcl.in/html/Roads.html, accessed on 15 Nov 2017

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S No.

Institution Role/Objective Types of Projects undertaken

establish mandatory and uniform standards for all road sector

11 Planning and Road Asset Management Centre (PRAMC)

PWD established PRAMC in August 2012. Its functions include Policy Development and Planning, Programming, Road safety, Information Technology support across the whole of PWD and Training support across whole of PWD

Functions of PRAMC –

Act as a cohesive central office for the planning, Budgeting and Programming of Public roads in Karnataka

Effectively accomplish and support Karnataka Road Asset Management System (KRAMS). It is the first of its kind project in India to gather and analyses details on condition of roads.

Planning and decision making, taking into account economic, social, and environmental factors

Procurement and effective monitoring of Right of Way

Preparation of Annual Works Program and Infrastructure Budgets

Act as a road safety Cell for PWD by coordinating road safety activities in PWD

Improve staff development and training in PWD to help sustain the new processes

Annual budgeting process for PWD

12 Karnataka State Highways Improvement Project (KSHIP)

KSHIP is an initiative of the Public Works, Port & Inland Water Transport Department (PWP&IWTD) of the Government of Karnataka for the improvement of road network of the state with assistance from the World Bank (WB) and Asian Development Bank (ADB).

KSHIP – I67 Under KSHIP-I, 2384 km of State Highways were developed at a cost of INR 2351 crore, with World Bank loaning 80% of the project cost (INR 1635 crore). The project ran from 2001 to 2010. KSHIP – II68

Stage 1: With World Bank financing, 826 km of State Highways have been finalized for upgradation to 2-lane

Stage 2: With ADB financing, 634 km of State Highways

67 Past Works (KSHIP I), Karnataka state highways Improvement project, https://www.kship.in/en/project_past_works.aspx, accessed on 11 Nov 2017 68 Past Works (KSHIP II)-Progress Summary, Karnataka state highways Improvement project https://www.kship.in/en/project_present_works.aspx, accessed on 11 Nov 2017

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have been prioritized for development

The project is expected to complete by June 2018 KSHIP – III69 By borrowing the second ADB loan for the KSHIP, the PWP&IWTD has decided to develop 418 km of State Highways in three packages –

Kollegal to Hannur (SH-79), Chintamani to AP Border (SH-82) and Bengaluru to Magadi (SH-85) to NH-75 via Chikkamudigere and Iyandahalli (MDR)

Magadi to Near Somwarpeth (SH-85)

Gadag to Honnalli (SH-57 and SH-26)

13 Karnataka Rural Road Development Agency (KRRDA)

The goal of the organization is to create basic infrastructure in rural areas to make them self-reliable and self-sufficient by 2020. KRRDA aims create qualitative and sustainable rural infrastructures within a time-bound manner to meet the needs of end users and deliver value for money invested.

KRRDA is a Special Purpose Vehicle (SPV) created by the RD&PR department for the speedy implementation of rural infrastructure projects in the state of Karnataka. It is the nodal agency in Karnataka for the overall implementation of PMGSY.

14 Karnataka State Road Transportation Corporation (KSRTC)

KSRTC was established in 1961 to provide efficient, adequate, economic, and well-coordinate transport services to commuters. Over time it has been bifurcated in BMTC for Bangalore City, NWKRTC for North-Western districts of Karnataka, and NEKRTC for North-

Presently, KSRTC covers seventeen Districts in the State under its operational jurisdiction. KSRTC has 79 Depots, 2 Regional Workshops, 1 Central Training Institute, 2 Regional Training Institutes, 1 Printing Press and 1 Hospital. It operates 26.43 lakh kms daily holding a fleet of 8348 and earns traffic revenue of INR 754.57 lakh daily catering to 25.57 lakh

69 KSHIP-III (ADB 2nd Loan), Karnataka state highways Improvement project https://www.kship.in/en/project_future_works.aspx, accessed on 11 Nov 2017

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Eastern districts of Karnataka.

passengers on an average. It has a workforce of about 36875 employees. It stands 5th amongst STUs in the Nation by size.70

15 Indian Railway Stations Development Corporation Limited (IRSDC)

IRSDC is a Joint Venture company of Ircon International Limited (A Govt. of India Undertaking, under Ministry of Railways) and Rail Land Development Authority, a statutory authority under the Ministry of Railways and was incorporated under the Companies Act, 1956 on 12th April, 2012. ISRDC is an SPV with the vision “to be a leading organization in the field of development, redevelopment, operation and maintenance of railway stations with passenger amenities of international standards”71.

The main objects of the Company as enshrined in its Memorandum and Articles of Association are –

To develop/ re-develop the

existing/new railway station(s)

To undertake projects for

development of real estate on

Railway/ Government land and

its commercial utilization

To undertake projects

including planning, designing,

development, construction,

improvement, commissioning,

operation, maintenance, and

financing of projects and

various services related to

railway stations and railway

infrastructure

To carry on any railway

infrastructure work including

development of railway

stations

Initially, eight (8) railway

stations namely – Chandigarh,

Bhopal-Habibganj, Pune-

Shivaji Nagar, New Delhi-

Bijwasan, New Delhi-Anand

Vihar, Surat, Gandhinagar and

Mohali – were entrusted to

ISRDC for development &

feasibility study72.

In 2017, five more stations — Amritsar, Byappanahalli (Bengaluru), Gwalior, Nagpur and Gandhinagar (Jaipur) — have been added to its station redevelopment plan73.

70 History of KSRTC , Karnataka State Road Transport Corporation, http://www.ksrtc.in/pages/about-us.html, accessed on 11 Nov 2017 71 Annual Report 2015-16, ISRDC, https://www.irsdc.com/annual_report/Annual%20Report%202015-16.pdf, accessed on 10 Nov 2017 72 Ongoing, ISRDC, https://www.irsdc.com/projects/ongoing.html, accessed on 10 Nov 2017 73 Five stations added to IRSDC’s station redevelopment plan, February 2017, http://www.infracircle.in/five-stations-added-irsdcs-station-redevelopment-plan/, accessed on 10 Nov 2017

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16 South Western Railway (SWR)

South Western Railways is one of the 16 railway zones in India. It became operational in April 2003 and was created by amalgamating the re-organized Hubli division from South Central Railway and Bangalore & Mysore divisions from Southern Railway It is headquartered at Hubballi and comprises 3 divisions namely Hubballi, Mysuru, and Bengaluru. The 4th division at Kalaburagi will come up shortly and preparations of work has already begun.

South Western Railway primarily caters to Karnataka state with 84% of its jurisdiction located within the state. The balance 16% of its route length falls in Andhra Pradesh, Tamil Nadu, Maharashtra and Goa. Bangalore division of this zone is passenger oriented while Hubli & Mysore divisions are freight oriented. There has been perceptible improvement in Railway services across Karnataka and its districts. After its formation 345 km of new line, 598 km of GC and 521 km of doubling have been commissioned. 110 numbers of new Express/Passenger trains have been introduced. Apart from this, services of many trains have been extended and frequency of some trains has been increased for the benefit of travelling public74

17 Karnataka Rail Infrastructure Development Corporation Ltd. (K-RIDE)

K-RIDE is set-up with an objective of developing and implementing rail infrastructure projects in Karnataka with a private sector participation wherever found feasible / viable. K-RIDE is an associated organization of the IDD.

Cost sharing projects completed

and opened for traffic

o Sholapur – Gadag (GC)

o Shimoga – Talaguppa

Gauge Conversion Project.

o Kottur-Harihar New

Railway Line

o Kadur-Chikkamagalur New

Railway Line

o Kolar-Chickapallapur

Gauge Conversion

o Road over Bridge / Road

under Bridge (RoB/RuB)

o Bangalore-Ramangaram-

Mysore Railway Doubling

o Hassan –Bangalore New

Line

o Bidar-Gulbarga New

Railway Line

Projects under implementation:

o Munirabad-Mehboonagar

New Railway Line

74 About Us, Southwestern Railways, http://www.swr.indianrailways.gov.in/view_section.jsp?lang=0&id=0,1,800, accessed on 18 Nov 2017

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o Bagalkote-Kudachi New

Railway Line

o Tumkur-Rayadurga New

Railway Line

o Chickmagalur-

Sakaleshpura new line

o Gadag-wadi New Railway

Line

o Bangalore-Chamarajnagar

Broad Gauge

New Projects

o Kolar Railway Coach

Factory

o Railway Fiat Coach

Factory at Yadgir

(completed)

18 Dedicated Freight Corridor Corporation of India (DFCCIL)

DFCCIL is a corporation run by the Indian Ministry of Railways to undertake planning and development, mobilization of financial resources, and construction, maintenance and operation of the Dedicated Freight Corridors.

In 2016 DFCCIL has also proposed an 899-km long Chennai-Goa Dedicated Freight Corridor75 that will go through the Bangalore-Chennai Industrial Corridor. There is also a proposal to extend this line to Mangalore to connect with India’s biggest petrochemical complex, international air-cargo facility and a major seaport.

19 Container Corporation of India Ltd. (CONCOR)

CONCOR is a Government of India undertaking that commenced operation from November 1989, taking over the existing network of 7 Inland Container Depots (ICDs) from the Indian Railways, providing inland transport by rail for containers. Today, it has the largest network with 68 ICDs and Container Freight Stations (CFSs) in India. In addition to

CONCOR’s core business is characterized by three distinct activities76 –

As a carrier. Rail is the mainstay of CONCOR's transportation plans & strategy. Majority of CONCOR terminals are rail-linked, with rail as the main carrier for haulage. Facilities are also provided for first and last mile transportation by road.

As a Terminal operator. CONCOR's customs bonded ICDs serve the purpose of bringing all port facilities including customs clearance to the customer's doorstep.

75 Progress in Dedicated Freight Corridor, Press Information Bureau, Government of India, Ministry of Railways, August 2015, http://pib.nic.in/newsite/PrintRelease.aspx?relid=124598 , accessed on 05 Dec 2017 76 Core Business, Container Corporation of India Ltd, http://www.concorindia.com/corebusiness.asp, accessed on 18 Nov 2017

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providing inland transport by rail for containers, it has also expanded to cover management of Ports, air cargo complexes and establishing cold-chain.

As a Warehouse operator. CONCOR's terminals provide a spectrum of facilities in terms of warehousing, container parking, repair facilities, and even office complexes

CONCOR also developed multimodal logistics support for India's International and Domestic containerization and trade.

20 Bangalore International Airport Limited (BIAL)

Under the Concession Agreement (‘CA’) signed in 2004 between the Government of India and Bangalore International Airport Limited (‘BIAL’), BIAL has been given the exclusive right and privilege to carry out the development, design, financing, construction, operation, and management of the Kempegowda International Airport, Bengaluru (‘KIAB’) airport. The agreement is for an initial period of 30 years from it’s the airport opening date, with an option to extend the concession for another 30 years.

As a pioneer of change in Indian aviation, Kempegowda International Airport Bengaluru has the distinction of being the first airport in India, to be constructed through a public-private partnership. Built and operated along the highest international standards, Kempegowda International Airport Bengaluru is set to become India's leading travel destination known for its quality and efficiency.

21 Directorate of Urban Land Transport (DULT)

The Directorate is in general responsible for overseeing all the urban land transport initiatives in Urban/Local Planning areas of Karnataka. It functions under the Urban Development Department of the Government of Karnataka. DULT was set up in 2007 by the

The functions of the DULT as per GoK are77 –

Periodic assessment of travel demand

Determination of the level of public transport required in different corridors and the type of transport systems required

Assessment & recommendation of the new investments needed creation of infrastructure

Procurement of public transport service from private operators

77 About Us, Directorate of Urban Land Transport, http://urbantransport.kar.gov.in/aboutus.html, accessed on 18 Nov 2017

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Government of Karnataka close on the heels of the National Urban Transport policy coming into force, to coordinate planning and implementation of urban transport matters in the State. For the first time-qualified personnel trained in urban transport planning were introduced into the government system.

Policy guidelines for development of total network in urban areas/ new layouts

Designing and developing integrated policies and plans for city level transportation

Since its inception, the Directorate has implemented many initiatives including service level benchmarking in Bangalore; preparation of policies on parking; preparation of mobility plans for cities in Karnataka; feasibility studies for mass transit systems etc. The Directorate is also spearheading the implementation of Bus rapid Transit system between the twin cities of Hubli and Dharwad.

22 New Mangalore Port Trust (NMPT)

NMPT operates the New Mangalore Port. It is a deep-water, all-weather port at Panambur, Mangalore and is the deepest inner harbour on the west coast. It is the only major port of Karnataka and the seventh largest port of India.

The major commodities exported through the Port are Iron Ore Concentrates & Pellets, Iron Ore Fines, POL Products, Granite Stones, Containerized Cargo, etc. The major imports of the Port are Crude and POL products, LPG, Coal, Limestone, Timber logs, Finished Fertilizers, Liquid Ammonia, Phosphoric Acid, Other Liquid Chemicals, Containerized cargo, etc.78 NMPT has ensured that the Port has been functioning as a catalyst for the economic development of this region and cater the needs of the shippers. Over the years the Port has grown from the level of handling less than a lakh tonnes of traffic during the inception period to over 40 million tonnes

23 Karnataka Maritime Board (KMB)

In accordance with Karnataka Maritime Bill 2011, the Government of Karnataka has initiated a process to formulate the Karnataka Maritime Board as an overarching institution

The main objective of the Bill is for rapid Development and Management of Ports, Inland Water Ways and the Coastal region in the State. KMB would act as the nodal agency to co-ordinate and implement the Minor Port Development Policy of the

78 History, New Mangalore Port Trust, http://newmangaloreport.gov.in:8080/#!/history, accessed on 15 Nov 2017

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to cater to the long term development of ports in state.

Government once the bill becomes an Act.

Annexure II – Details of various Government programs and schemes

Infra sub-sector

Program Description

Coverage Directed benefits for the state

Overall Invest Karnataka

Invest Karnataka is a biennial meet that aims to create a platform for the best minds to meet, exchange ideas and drive forward the state's vision of prosperity for all - by employing technology, innovation, inclusivity and sustainability as key factors for development. The last Invest Karnataka took place from 3rd-5th Feb 2016.

State Highlights from Invest Karnataka 201679 –

The meet ended with 1,080 approved projects and MoUs with an investment of over 1.7 lakh crores, and over 4.8 crore jobs are expected to be generated.

Focus sectors showcased during the meet as having very high growth potential include among others, Smart Cities and Urban Infrastructure, Infrastructure, and Energy including Renewable Energy

For the Infrastructure sector, 31 projects were announced which are expected to attract an investment of more than 11 lakh crore and generate over 1.7 lakh jobs

GoK will set up a public-private partnership company called Karnataka Invest where industrialists will advise the government and will function as ambassadors to attract global investments.

An additional investment of INR 1.50 lakh crore was committed by the centre for the development of roads, ports, and other mega projects in Karnataka

Reliance Group announced plans for the establishment of the Dhirubhai Ambani Centre for Innovation and Research in Aerospace to be set up under Reliance Defence at Whitefield in Bengaluru. It will generate more than 1,500 highly skilled jobs and support the government’s plan for indigenous design, development, and manufacturing of equipment.

The Ministry of Roadways, Transport, and Highways (MoRTH) committed to adding 4,000 km of national highways in Karnataka and assured an investment of INR 10,000

79 Highlights of Global Investors Meet 2016, Government of Karnataka, https://www.karnataka.com/govt/gim/highlights-of-karnataka-global-investors-meet-2016/, accessed on 10 Nov 2017

98

Infra sub-sector

Program Description

Coverage Directed benefits for the state

crore to double the capacity of New Mangaluru Port

Roads National Highways Development Project (NHDP)

Program aims to upgrade, rehabilitate, and widen major highways in India to a higher standard.

National Projects under implementation (as of May 2017)

Phase III80

NH 9 Maharashtra-Karnataka Border Sangareddy

NH 13 Hospet-Chitradurga

NH 9 4-Laning of Solapur-Maharashtra/Karnataka Section

NH 13 4-Laning of Solapur-Bijapur

NH 4A Panaji-Goa/Karnataka Border

NH4A 4-Laning of Belgaum-Khanpur Section and 2-Laning with paved shoulders of Khanpur-Karnataka/Goa Border

NH 17 Kundapur-Surathkal & Mangalore-Karnataka/Kerala Border

NH 13 4-Laning of Hospet-Chitradurga

Phase IV81

NH 63 4-Laning of Hospet-Bellary-Karnataka/AP Border

NH 63 4-Laning of Hubli-Hospet Section of NH-63

NH 209 Two/Four-Laning of BRT Tiger Reserve Boundary to Bangalore section of NH-209

NH-63 4-Laning of Hosapete-Bellary-Karnataka/AP Border

NH 17 4-Laning of Goa/Karnataka Border-Kundapur Section

NH 207 4-Laning of Hoskote-Dobbaspet

NH4 Rehabilitation and upgradation of NH-4 from Nalagampalli to AP/Karnataka Border

NH 48 4-Laning of Addahole to Baniwal

NH 218 Two lane with paved shoulders of Bijapur-Gulbarga-Homnabad section of NH-218 (New NH-50)

NH 48 4-Laning of Hasan to Maranhally

Roads Bharatmala Pariyojana

Bharatmala is a centrally-funded roads and highways project of the Government of India that will subsume all

National The nationwide program will create 50 new National corridors and connect 550 districts across India through National Highway linkages, generating a large number of direct and indirect employment opportunities in the construction & infrastructure sector and also as a part of the enhanced economic activity resulting from better road connectivity across

80 NHDP Phase III Projects Under Implementation, NHAI, http://www.nhai.org/phase3ui.asp, accessed on 10 Nov 2017 81 NHDP Phase IV Projects Under Implementation, NHAI, http://www.nhai.org/phase4ui.asp, accessed on 10 Nov 2017

99

Infra sub-sector

Program Description

Coverage Directed benefits for the state

existing highway projects including those under NHDP. The Bharatmala project addresses critical infrastructure gaps and focuses on optimizing efficiency of the movement of goods and people across the country.

the country82. The programme will ensure that 70-80% of freight moves along national highways83

In Karnataka, the NHAI began a survey in October 2017 on widening the Mulki-Kinnigoli-Kateel-Bajpe-Polali-B.C. Road and Melkar-Mudipu-Konaje-Thokkottu road stretches and connecting them to NH 66 (Kasaragod-Goa) and NH 75 (Mangaluru-Bengaluru)84

Roads and Railways

Logistic Efficiency Enhancement Programme (LEEP) 85

LEEP is a program under NHAI as a part of Bharatmala Pariyojana aimed to enhance the freight transportation in India through improving cost, time, tracking and transferability of consignments through infrastructure, procedural and Information Technology (IT) interventions,

National A 150 acre Multimodal Logistics Park (MMLP) is planned near NH 48 to bypass Bengaluru and connect to Chennai86. The MMLP will have covered warehouses, aggregation-disaggregation space, customs clearance facility, and cold-storage facilities.

The 125 acre Bengaluru (Whitefield) Inland Container Depot (ICD) is developed near NH75 and has direct rail connectivity. It has 4 railway sidings, bonded storage yard of 26,256 sq m, warehouse area of 39,875 sq. m, and provision for LCL facility. The facility is managed by CONCORD and has become operational, handling more than 50,000 TEUs of EXIM cargo annually.

State Highway Development Project (SHDP)

State The project is proposed to be taken up in two phases87 –

Phase I88

82 Bharatmala Pariyojana EBook, Ministry of Road Transport & Highways, Government of India, October 2017, http://www.nitingadkari.org/pdf/BharatMala_Pariyojna_Ebook.pdf, accessed on 10 Nov 2017 83 What is Bharatmala Project, Financial Express, October 2017, http://www.financialexpress.com/india-news/what-is-bharatmala-project-10-points-to-know-about-pm-narendra-modis-most-ambitious-rs-10-trillion-highway-development-plan/904691/, accessed on 10 Nov 2017 84 Road Widening Survey to Being on October 9, The Hindu, October 2017, http://www.thehindu.com/todays-paper/tp-national/tp-karnataka/road-widening-survey-to-begin-on-october-9/article19816476.ece, accessed on 11 Nov 2017 85 NHAI initiates DPRS for Logistic Efficiency Enhancement Programme (LEEP) under Bharatmala Pariyojna, Press Information Bureau, Ministry of Road Transport & Highways, Government of India, November 2016, http://pib.nic.in/newsite/PrintRelease.aspx?relid=153623, accessed on 20 Nov 2017 86 Logistics parks in India Brief profiles of existing and upcoming projects, India On The Go http://indiaonthego.in/pdf/Logistics_Park_Profile_Booklet_Final.pdf, accessed on 20 Nov 2017 87 Present Status, State highway development project, GoK, http://www.shdpkar.in/status.htm, accessed on 11 Nov 2017 88 Physical Progress Summary in Length KM SHDP (Phase I), PWD, Karnataka http://shdpkar.in/pms/Pub/Portfolio/frmPhyPrgLenghSummary.aspx, accessed on 11 Nov 2017

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Infra sub-sector

Program Description

Coverage Directed benefits for the state

Based on the approval accorded by the state cabinet in May 2011, an empowered committee has proposed improvements to 7254 km of core road network in the state by the PWD at an estimated cost of INR 2797 crore. Additional improvements to state highways are being carried out by KSHIP and KRDCL.

Under Phase-I, 66 packages have been approved for improvement of 2087 km and renewal of 1637 km of state highways at an estimated cost of 1439 crore

Administrative approval was given in November 2012.

As of Dec 2017, 90.5% of the project has been completed at a cost of INR 1672 crore

Phase II89

Under Phase-II, 70 packages have been approved for improvement of 3745 km of state highways at an estimated cost of INR 1499 crore

Administrative approval was given in March 2013.

As of Dec 2017, 82.7% of the project has been completed at a cost of INR 1851 crore

Pradhan Mantri Gram Sadak Yojna (PMGSY)

PMGSY was launched by the Government of India to provide connectivity to unconnected habitations as part of a poverty reduction strategy

National The of PMGSY is to set high and uniform technical and management standards and facilitating policy development and planning at the state level in order to ensure sustainable management of the rural roads network90. As the programme unfolded, a further need for interventions led to the launch of PMGSY-II. The new project envisages consolidation of the existing rural road network to improve its overall efficiency as a provider of transportation services for people, goods and services. It aims to cover upgradation of existing selected rural roads based on their economic potential and their role in facilitating the growth of rural market centres and rural hubs.

For the financial year 2016-17, grants-in-aid amounting to INR 38 crore were released to the State Government of Karnataka under PMGSY-II for development of roads.

Roads and Railways

Setu Bharatam

The Setu Bharatam project was launched in 2016 with an aim to make all National

National In Karnataka, 17 Railway over Bridge (ROBs) have been identified under the Setu Bharatam scheme.

The Indian Bridge Management System (IBMS) was launched in October 2016 to

89 Physical Progress Summary in Length KM SHDP (Phase II), PWD, Karnataka http://shdpkar.in/pms/Pub/Portfolio/frmPhyPrgLenghSummary.aspx?p=2, accessed on 11 Nov 2017 90 Pradhan Mantri Gram Sadak Yojana, http://www.omms.nic.in/Home/HomePage, accessed on 11 Nov 2017

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Infra sub-sector

Program Description

Coverage Directed benefits for the state

Highways free of railways level crossings by 2019 and to strengthen/overhaul about 1500 old and worn-out bridges on National Highways.

create an inventory of all bridges in the country and rate their structural condition so that timely repair and rehabilitation work can be carried out91. The bridges are also assigned a Socio-Economic Bridge Rating Number which will decide the importance of the structure in relation to its contribution to daily socio-economic activity of the area in its vicinity

Railways Diamond Quadrilateral

The Diamond Quadrilateral is a project of the Indian Railways to establish a high-speed rail network in India. The quadrilateral will connect the four metro cities of India and pass through 14 states and territories of India.

National The major terminals will be at Delhi, Mumbai, Pune, Visakhapatnam, Thiruvananthapuram, Bengaluru, Chennai, Hyderabad, and Kolkata.

Karnataka will fall under the Mumbai Chennai corridor. The stations of Karnataka under this corridor are – Belagavi, Hubballi, Davangere, Tumkur, Bengaluru, and Bangarapet.

A study is underway to increase the speed of trains to 160-200 kmph on the Mysuru-Bengaluru-Chennai sector by upgrading the present network

Ports Sagarmala Programme

Under the Sagarmala programme, projects will be undertaken for port modernization and new port development, port connectivity enhancement, port-linked industrialization, and coastal community development for phase-wise implementation over the period 2015 to 203592.

National In Karnataka, a new port location has been identified at Belikeri in Uttara Kannada and a Techno Economic Feasibility Report (TEFR) report has been prepared as of March 2017. The union government plans to invest INR 4000 crore to develop the port and also establish rail connectivity between Ballari and Belikeri at a cost of INR 1420 crore93.

In Karnataka, the Dakshin Kanara Coastal Economic Zone (CEZ) will be linked to New Mangalore Port and stretches from Udupi, Dakshin Kannada, Kodagu, and Mysore district. The CEZ will be anchored by a petrochemical cluster that also includes food and fertilizers plants and a fishery harbour. Another port-led industrial cluster under development is the Hubli-Dharwad cluster

91 Shri Gadkari Launches Indian Bridge Management System, Press Information Bureau, Ministry of Road Transport & Highways, Government of India, October 2016, http://pib.nic.in/newsite/PrintRelease.aspx?relid=151406, accessed on 11 Nov 2017 92 Sagarmala Program, Press Information, Bureau, Ministry of Shipping, Government of India, March 2017, http://pib.nic.in/newsite/PrintRelease.aspx?relid=159037, accessed on 11 Nov 2017 93 Belekeri port to be developed as ‘Gateway of Karnataka’ , The Hindu, September 2016, http://www.thehindu.com/todays-paper/tp-national/Belekeri-port-to-be-developed-as-%E2%80%98Gateway-of-Karnataka%E2%80%99/article14383706.ece, accessed on 12 Nov 2017

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Infra sub-sector

Program Description

Coverage Directed benefits for the state

In addition to the economic benefits of port-led development, the Sagarmala projects will improve logistics and exports and also improve opportunities for cruise tourism. There is a huge scope for governments to offer incentives to attract investors to set up more industrial units and invest in other infrastructure projects in areas that come under the purview of Sagarmala.

Airports UDAN (Ude Desh ka Aam Naagrik) Scheme

UDAN is a Regional Connectivity Scheme94 (RCS) of the Government of India seeking to boost air connections in India by linking up hundreds of unserved and underserved airports in Tier 2 and Tier 3 with major cities and with each other.

National In the first phase of bidding in April 2017, three out of the 45 airports selected were from Karnataka95 – Mysuru (Mandacally), Bidar and Vidyanagar

As of Nov 2016, Airports Authority of India (AAI) listed 19 unserved Airports and Airstrips in Karnataka96 – Ammasandra, Bengaluru (HAL), Bellary, Bidar, Chikkmagaluru, Gingera (Hosapete), Harihar, Hassan, Jakkur, Karwar, Kolar, Koppal, Kushalnagar, Mysuru (Mandacally), Raichur, Shahbad. Vidyanagar, Yadgiri, and Yehlanka. Thus, there is still significant opportunity to grow airport connectivity in Karnataka under UDAN.

Airports Karnataka Aerospace Policy 2013 – 202397

The Karnataka Aerospace Policy 2013-2023 aims to make the state a favourable destination for maintenance, repair, and overhaul (MRO) investments.

State At the 2016 Invest Karnataka meeting, 33 project proposals were received to the tune of INR 14,520 crore and with the potential to generate over 10,000 jobs98. In addition to the MRO and defence areas, the government is also trying to attract investments in designs, components, and R&D.

Key measures that will be undertaken under this policy are as follows –

Bengaluru has the Bangalore Aerospace Park (BAP) at Devanahalli and MRO centers at BIAL. Additionally, the Bangalore Aerospace SEZ (BASEZ) will also be made operational by providing required infrastructure. These parks will have the

94 Regional Connectivity Scheme- UDAN, AAI, Ministry of Civil Aviation, Government of India, October- 2016, http://www.civilaviation.gov.in/sites/default/files/Final%20Regional%20Connectivity%20Scheme%20%28RCS%29.pdf , accessed on 12 Nov 2017 95 Udan Scheme, india.com, April 2017, http://www.india.com/news/india/udan-scheme-list-of-45-new-airports-over-70-new-routes-announced-today-5-airlines-make-the-cut-1976363/, accessed on 12 Nov 2017 96 List of unserved airports / airstrips in the country, AAI AERO, November 2016, https://www.aai.aero/sites/default/files/LIST-UNSERVED-AS-ON22NOV16.pdf, accessed on 12 Nov 2017 97 Karnataka Aerospace policy 2013-2023 with amendments, Commerce and industries department, September 2016, http://www.investkarnataka.co.in/assets/downloads/aerospace-policy.pdf, accessed on 12 Nov 2017 98 Karnataka tweaks Aerospace Policy, Business Line, August 2017, http://www.thehindubusinessline.com/news/national/karnataka-tweaks-aerospace-policy/article9056453.ece, accessed on 12 Nov 2017

103

Infra sub-sector

Program Description

Coverage Directed benefits for the state

following facilities – Manufacturing area and SEZ, MRO with a direct access to the BIAL runway, testing center, hardware/embedded technology center, technology innovation center including a certification/calibration center, a common facility center, housing, and other related activities and facilities.

Opening up opportunities for developing aerospace activities in Tier-II cities

o Greenfield airports at Shivamogga, Vijayapura, Hassan and Kalaburagi through the PPP model with investments in 100’s of Crore

o Opening of the defence airports at Bidar and Karwar for civil aircrafts

o Develop air strips and helipads at all district headquarters and important industrial destinations that do not have air connectivity. Air strips will be constructed at Davanagere, Chikkmagaluru, Udupi, Madikeri, Gokarna, Chitradurga, Bagalkot, Haveri, Gadag and Kollegal.

Creation of three clusters with relevant focus areas and institutions. The cluster envisages inclusion of enterprises, financial providers, suppliers, service providers, and common facilities such as testing laboratory. The planned clusters are –

o South Cluster – Bengaluru, Tumakuru, Mysuru & Mangaluru. This cluster includes Bangalore Aerospace Park, Devanahalli; MRO at KIAL & Mysuru; Manufacturing cluster at Dakshina Kannada District; Defence production cluster in the Aerospace sector around HAL Helicopter Unit, Gubbi, Tumakuru

o Central Cluster – Davangere & Chitradurga. This cluster includes Establishment of Aerospace Research & Innovation Centre co-located with IISc proposed at Chitradurga; Aerospace & Aeronautical University at Davanagere; Establishment of Flying training school at Davanagere.

o North Cluster – Belagavi & Bidar. This cluster includes Co-locating an Aerospace Training Institute co-located with IAF training centre;

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Infra sub-sector

Program Description

Coverage Directed benefits for the state

Industrial Corridors

Bengaluru-Mumbai Economic Corridor (BMEC)

BMEC connects the IT capital of the country to the financial capital. Creation of this corridor will ease the load on Bengaluru and help rapid development of the industry in the northern parts of Karnataka. The UK Trade and Investment (UKTI) is the nodal agency on the side of the UK who expressed interest in cooperation for the development of the corridor in 201399.

National The corridor is delineated around the existing NH4 and also includes the existing Bangalore-Mumbai railway line, and the Dabhol-Bangalore natural gas pipeline. It passes through major cities such as Chitradurga, Hubballi-Dharwad, Belagavi, Solapur, Sangli, and Pune. Dharwad has been identified by Government of Karnataka as the first industrial node for further development while Government of Maharashtra has shortlisted Sangli and Solapur as potential nodes for development100.

Hubbali-Dharwad is the second largest city in Karnataka and is well connected not only through road and rail but also has a functional domestic airport and has good connectivity to the Karwar port. With a strong existing industrial infrastructure, the twin cities have the potential to attract investment. The presence of prestigious institutes and skill development centers means that it can provided skilled manpower for IT, R&D, and innovation centers and support manufacturing, logistics and agro-based industries101.

The corridor is expected to generate 25 lakh jobs and attract investment of INR 3 lakh crore102. The industries expected to benefit from the creation of this corridor are – steel, cement, auto components, readymade garments, food processing, and textile industries.

Inter-state corridors

Chennai-Bengaluru Industrial Corridor (CBIC)

CBIC will cover the states of Karnataka, Tamil Nadu, and Andhra Pradesh and provides world-class connectivity to Chennai, an

National The corridor will have eight nodes based on land availability and growth potential. Three nodes have been selected for prioritized implementation – Tumakuru in Karnataka, Krishnapatnam in Andhra Pradesh, and Ponneri in Tamil Nadu. Once completed, the corridor will result in a world-class tolled road, a high-speed rail link and industrial clusters all along the corridor.

99 Brief About the Scheme, Department of Industrial Policy & Promotion, http://dipp.nic.in/programmes-and-schemes/bengaluru-mumbai-economic-corridor-bmec-project, accessed on 27 Nov 2017 100 Industrial Corridors, Ministry of Commerce & Industry, Department of Industrial Policy & Promotion , Government of India, November 2016 101 Smart City Vision, Hubli Dharwad Vision, http://www.hubballidharwadsmartcity.com/smart-city-vision.html, accessed on 27 Nov 2017 102 Bengaluru Mumbai Economic Corridor (BMEC): Sustainable Development Plan, pp 4-12, Connect July 2015, EGIS India

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Infra sub-sector

Program Description

Coverage Directed benefits for the state

important port on the Bay of Bengal. The project has been under planning since in partnership with the Japan International Cooperation Agency (JICA) since 2011103.

The long term vision of the CBIC is to develop itself as a globally competitive manufacturing hub that promotes sustainable development by creating at least 22 million jobs in the next 20 years. The corridor is expected to attract an investment of USD 181 billion by the time of its completion104.

The focus sectors for the corridor are – food processing, textiles & apparels, machinery & electric machinery, pharmaceuticals, petrochemicals, automobiles, and computer, electronics & optical products105.

Tumakuru, apart from being a part of CBIC, is also expected to develop into an influence zone for BMEC. Vasantha Narasapura in Tumakuru district has been identified as a National Investment and Manufacturing Zone (NIMZ) and will focus on the establishment of state-of-the-art integrated industrial townships, skill develop, social infrastructure, and single window clearances. The area is expected to give employment to 2.5 lakh people. Indian Machine Tool Manufacturers Association (IMTMA) has proposed to set up a machine tool part at the NIMZ and around 600 machine tool companies have shown interest in setting up manufacturing units in the area106. Prospective investors can expect to benefit from faster delivery and receipt of goods from the Chennai port.

Inter-state corridors

Kochi Bengaluru Industrial Corridor (KBIC)

KBIC will pass through Palakkad and Coimbatore in Kerala to link with the Bangalore Chennai

National The industrial corridor is expected to have NH 544 between Salem and Kochi, an offshoot of the NH 44, as its spine. The corridor is expected to optimize the economic and employment potential of the region, and stimulate investments particularly in the manufacturing, agro-processing, services, and export oriented units and promote overall economic

103 Progress in setting up of industrial corridors, Department of Industrial Policy & Promotion, Ministry of Commerce & Industry, Government of India, February 2016 104 Chennai-Bengaluru Industrial Corridor is a boon for exporters, Invest Karnataka, November 2016, http://www.investkarnataka.co.in/blog/4/chennai-bengaluru-industrial-corridor, accessed on 10 Nov 2017 105 Comprehensive Integrated Master Plan for Chennai Bengaluru Industrial Corridor Final Report , Japan International Cooperation Agency, Nippon Koei Co., Ltd. October 2015, http://open_jicareport.jica.go.jp/pdf/12249348.pdf, , accessed on 27 Nov 2017 106 Tumkur Machine Tool Park, Indian Machine tool Manufacturers association, http://www.imtma.in/pages/92/machine-tool-park, accessed on 17 Nov 2017

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Infra sub-sector

Program Description

Coverage Directed benefits for the state

industrial corridor. Presently, the Kerala State Industrial Development Corporation Limited (KSIDC) is in the process of selecting consultants for planning for identified integrated manufacturing cluster (IMC) sites for the corridor region.

development of the area through creation of high standard infrastructure and an enabling pro-business environment107

Intra-state corridors

Naidupeta – Mulbagal Road Upgradation

Mulbagal in Kolar district of Karnataka is considered the eastern gate of Karnataka and is emerging as a key hub, making this an important road connectivity project.

State Covering a distance of 218 km, the project will allow smoother flow of cargo and lead to development along the eastern side of Karnataka108.

Mulbagal ranks number one in India in the productivity and yield of horticultural crops and has agriculture, dairy, sericulture, floriculture and tourism-related industries. The Government of Karnataka has also acquired 1,200 acres of land to promote a granite industries hub in Mulbagal as well as general engineering parks at Kolar and Hoskote.

The upgradation project will connect high volume traffic from Bengaluru and Tirupati to NH16 at Naidupeta in Nellore district109. The Naidupeta zone has several industries including glass, steel, automobile parts and textiles along with upcoming pharmaceutical units. The development of this corridor will also allow Bengaluru access to the Krishnapatnam Port (KPCL), an all-weather, deep water port on the east coast of India. It is one of India’s deepest ports with a draft of 18.5 meters and is capable of accommodating the biggest ships operating today110 and will be provide further opportunities for trade for Karnataka.

107 Selection of Consultant for Preparation of Perspective Plan and Concept Master Plan for IMC sites for Kochi Bangalore Industrial Corridor Region, KSIDC, April 2017, http://www.ksidc.org/userfiles/rfq_cum_rfp__kbic_perspective_plan.pdf, accessed on 20 Nov 2017 108 The Missing Link, Maritime Gateway, http://www.maritimegateway.com/news/the-missing-link/, accessed on 20 Nov 2017 109 Industrial hubs poised for a big leap, The Hindu, November 2017, http://www.thehindu.com/news/national/andhra-pradesh/industrial-hubs-poised-for-a-big-leap/article20629900.ece, accessed on 17 Nov 2017 110 Krishnapatnam Port offers deepest draft on east coast, Business Line, September 2017, http://www.thehindubusinessline.com/economy/logistics/krishnapatnam-port-offers-deepest-draft-on-east-coast/article9866198.ece, accessed on 12 Nov 2017

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Infra sub-sector

Program Description

Coverage Directed benefits for the state

Mass Transit

Bangalore-Chennai Hyperloop

National With the AECOM proposal for the Bangalore-Chennai Hyperloop being one of the winning proposals, a viability study is presently being carried out

If implemented, the project will enable a commute time of just 20 minutes for the 334 km route. In addition to being an energy efficient mode of rapid transit with minimal real-estate commitment, Hyperloop-One, the company behind the Hyperloop project plans to set up a research lab and also to license the technology to local manufacturers

Urban Transport

Revised Master Plan (RMP) 2031 (Draft)111

The draft master plan for Bengaluru has been created by the Bengaluru Development Authority (BDA) to document how the city will develop and function for the next 15 years

City-wide The BDA has stated that the four pillar stones of the RMP are ecological sustainability, mobility, inclusive growth, and streamlined governance112

“The BDA has revised the Master Plan for Bengaluru for 2031 as a spatial-policy framework adhering to the aspirations of the citizens flagged during public consultations, through, planning strategies and regulations focussing on balancing the city growth in terms of optimal and efficient utilization of land through efficient public transportation system and preserving the lake valley system and creating large lung spaces”.

Some key transport infrastructure highlights of RMP 2031 –

o The mixed land use strategy has been relooked at and a controlled approach using the space standards and road widths has been proposed to limit the intrusion of commercial activities in pure residential areas.

o The spatial distribution of land for economic nodes/centers, public-semi-public and greens. Integration of land use transport with consideration for road hierarchy and public transport

o RMP-2031 has proposed 5 Special Development Zones along the natural corridors of growth. The Special Development Zones have been envisaged as High Density Integrated

111 Revised master plan for Bengaluru – 2031 (Provisional), BDA, http://www.bdabangalore.org/TPMRMP2031.html, accessed on 17 Nov 2017 112 Revised master plan for Bengaluru – 2031 (Draft), Volume 1 –Vision Document , BDA, http://www.bdabangalore.org/Volume_1_Vision_Document.pdf, accessed on 17 Nov 2017

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Infra sub-sector

Program Description

Coverage Directed benefits for the state

Developments providing employment opportunities supported with the necessary residential and amenity requirements. The road network in these special development zones have accordingly been proposed to accommodate high density developments with strong public transport system connectivity.

o RMP 2031 has proposed 5 Rings and 26 radials to create a network of Major Arterial Roads considering the road hierarchy with regard to the envisaged density patterns

o RMP-2031 has proposed Mass Transport Corridors which includes creation of additional metro network along ORR and PRR, development of Mono Rail/ Light Rail/ BRTS

o Truck terminals and ISBTs/ TTMCs have been proposed along the major corridors and land has been accordingly allocated

o The Traffic Impact Assessment for large scale developments made mandatory

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Annexure III – Best Practices

Goal 1 - Enhance regional connectivity of roads ensuring first and last mile connectivity to all villages

Pradhan Mantri Gram Sadak Yojana (PMGSY)

PMGSY is one of the flagship government schemes to promote holistic rural development in terms of providing basic services and is known for its unique format, design, evaluation, and monitoring system leading to high socio economic impact. Under PMGSY, different states have fared well in terms of highest amount of rural roads % share, usage of non-conventional construction material apart from meeting specific targets set for a state. Karnataka has completed more than 95 percent of PMGSY (Phase I & II) targets. Bihar is recognized as the best performing state in construction of rural roads followed by Orissa.

Creating a Road Maintenance Culture (New Zealand)

A successful model of developing domestic private sector capacity for road maintenance which included several supporting initiatives such as the merger and restructuring of ministries, contractor training and maintenance capacity building, developing routine maintenance programs, introducing new pavement technologies, and introducing necessary legislation and technical standards. The project supported creation of a road maintenance capacity with domestic contractors participating in the program as opposed to the previous approach where International contractors would undertake the large works contracts. This help build local capacity as domestic contractors got an opportunity to bid on contracts of a size appropriate to their current equipment and financial capacity. The project led to increase in avenues of domestic contracting industry and a proficient road maintenance program.

ESSEX – The UK’s Multimodal Gateway

As a multi-modal hub, Essex delivers a freight transport infrastructure in the UK. Not only does the county have four sea ports and six rail freight terminals, direct access to the M25 motorway and 6 airports within 90 minutes’ drive. It also has three deep-sea international ports within 20 miles of central London. It also offers facilities for fast, efficient transfer between transport modes; Essex’s ports offer more than 1,000 acres of land for logistics development – either portside or port adjacent.

Goal 2 - Develop robust airport/airstrip infrastructure in the state

EU Aviation: 25 years of reaching new heights

Aviation in the EU supports 9.3 million jobs and EUR512 billion in GDP. Competition has brought major changes to air travel - changes that have propelled European mobility forward, successfully helping to bring Europeans closer together, and providing solid foundations for more jobs and a growing economy. Consumer demand has driven the continued expansion of new routes. In 2015 for example, almost 920 million passengers passed through 450 EU Airports and smaller regional airports continue to expand helping ensure balanced economic growth in all parts of the EU. The idea of travelling and experiencing new places and cultures has become a reality for many people in Europe. Creating the “Internal Market” removed barriers to competition. 25 years ago, competition was low and prices were sky-high where a last minute getaway or a weekend city trip with friends could only be dreamed of for many Europeans. Today, due to wider choice of travel, offered by more airlines competing on the market, flying has become more affordable. More routes and more connectivity boosted economy growth in the region.

Source: https://ec.europa.eu/transport/modes/air/25years-eu-aviation_es

Singapore’s Changi Airport - A marvel of efficiency and technology, providing a world-class

visitor experience

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Changi Airport (Hub to Asia) currently has four terminals, T1, T2, T3, and T4, with a total annual handling capacity of 80 million. The airport offers a veritable playground of facilities and services that keep travellers occupied during layovers. With over 750,000 square feet of retail space throughout the three terminals, shopping is a major pastime for airport captives. Key attractions include:

Shopping at Changi airport even draws local residents to the airport for retail therapy.

More than 100 dining options

Entertainment Deck - An integrated multi-media entertainment centre with a movie theatre, gaming consoles and Kinect Sports, music chairs and music videos.

Social Tree – A 360 degree display of 42” screens where travellers can post photos or videos of themselves on the screens or leave behind in a memory capsule

An Interactive Art Station offers wood block rubbing and an exploration of mystery Asian icons

Aviation Gallery - A interactive display of airport operations and aviation history

Children’s Playgrounds are available to help dissipate the energy of youth

Singapore’s Tallest Slide – A four-story shriek-fest for the traveller who needs to wake up after a long flight

Nature Trail - Five amazing gardens, each with a unique personality, which allows one to relax in the midst of nature.

The Fast and Seamless Travel (FAST) initiative of Changi airport offers automated and self-service functions in an effort to enhance operational efficiency and improve the traveller experience. Automated check-in kiosks and automated bag-drop machines are the latest to join in the initiative

Source: www.changiairport.com/en/airport-experience, https://www.covingtontravel.com/2014/08/singapores-changi-airport-a-great-place-for-a-layover/

Goal 3 - Augment Rail connectivity across the state

Building a seamless European rail infrastructure for the future: Community of European Railway and Infrastructure Companies (CER)

The rail network in Europe enables the transport of passengers and goods across member states with high efficiency and low emissions. CER’s role is to represent the interests of its members on the EU policy-making scene, in particular to support an improved business and regulatory environment for European railway operators and railway infrastructure companies. CER member companies in Europe manage 200900 km of railway lines.

CER has a diversity of members ranging from long-established bodies to new entrants and both private and public sector organizations. CER constituted a “4th Railway Package” which aims to remove the remaining barriers to the creation of a single European rail area. The legislation would reform the EU's rail sector by encouraging competition and innovation in domestic passenger markets. It would also implement structural and technical reforms. The result should be higher levels of safety, interoperability and reliability in the European rail network. The package was introduced as the European rail network was quite fragmented with different member states using different safety standards and technical system making it complicated and expensive for new rail operators and new technical equipment to enter the rail market. By removing the remaining barriers to the single European rail area, the 4th railway package aims to create a more competitive rail sector, with better connections between the EU

and its neighbouring countries.

Source: http://www.cer.be/about-us/who-we-are, http://www.consilium.europa.eu/en/policies/4th-railway-package/, https://ec.europa.eu/transport/modes/rail/packages/2013_en

Reducing carbon footprint – Accrington Station (UK)

Despite commencing construction during one of the coldest English winters in January 2010, Accrington train station – part funded by the EU through the Interreg IVB programme – received a very warm welcome. The new eco station, the first of its kind on the UK’s northern rail network,

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received a BREEAM (Building Research Establishment Environmental Assessment Method) rating of ‘excellent’ at the beginning of December 2010.

The building is made from recycled stone and uses photovoltaic cells to provide some of the building’s electricity requirements, incorporates solar water heating, a wind turbine for electricity generation and rain water harvesting for flushing toilets. Thirty photovoltaic (PV) solar panels, which it is hoped will supply over 4,000 kWh of electricity – are estimated to help reduce carbon emissions from the new station by over 2t each year.

The station is one of 24 partaking in UK national station travel plan pilot projects supported by various council organisations around the country. “Building a new eco station for the town is a key part of Accrington’s transport infrastructure and will provide an ideal opportunity for more people to try different travel options rather than the car,” says Richard Watts, Rail Projects Manager at Lancashire County Council.

Strategic location of Port of Antwerp (Belgium) Antwerp is at the junction of the major rail connections inside and outside Europe. Service providers have invested heavily in the rail offerings to make it as efficient and flexible as possible. For the majority of cargo flows it is a valid alternative to road transport and using railways has allowed a significant reduction of the ecological footprint. The port of Antwerp is a centrally located railway junction for the three main rail corridors in Europe – Rhine-Alpine Corridor, North Sea-Mediterranean Corridor, and North Sea-Baltic Corridor. Combined, these corridors cover more than 10 European countries. Moreover, trains regularly leave from Antwerp to destinations outside Europe such as Russia, Kazakhstan, Korea and China. In addition to public infrastructure, many private rail companies and rail operators have invested actively in direct international rail connections with the Port of Antwerp for all forms of shipment. There are four rail-dispatching agents and fourteen rail operators active in the port of Antwerp. This wide choice of specialised providers guarantees a varied service offering for companies using the port of Antwerp.

Source: http://www.portofantwerp.com/en/strategic-location

Linking freight facilities: Alameda Corridor (California, USA)

An excellent example of critical linkages in freight facilities has been the Alameda Corridor that

is a dedicated rail corridor in Los Angeles. It primarily links the Ports of Los Angeles and Long

Beach with the main railway yard in downtown Los Angeles, nearly 32 kilometres north of the

ports.

The first phase of the PAC's study, completed in 1982, dealt with the problems of highway

access to the ports. In this phase, the PAC addressed several problem areas and

recommended a cost-effective set of highway improvements, including the widening of certain

streets. The second phase, a study of rail access, was completed in 1984. Additional highway

improvements were recommended, but the focus of the second phase was concern over the

impact of projected train traffic on communities north of the ports. Three routing alternatives

were evaluated, and the results of the analysis indicated that consolidating all trains on an up-

graded Southern Pacific San Pedro Branch right-of-way would be the most cost-effective

alternative.

The Alameda Corridor was financed and built and is operated by the Alameda Corridor Transportation Authority (ACTA), a joint powers authority formed by the cities of Long Beach and Los Angeles. ACTA’s seven-member Governing Board includes two representatives from each port, a member of each city council, and a representative of the Los Angeles County Metropolitan Transportation Authority. ACTA’s principal responsibility is the collection of fees from the railroads to pay debt service on the outstanding revenue bonds.

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Source: http://www.acta.org/index.asp

Goal 4 - Develop quality port infrastructure and promote coastal shipping

Gujarat Maritime Board

Gujarat Maritime Board (GMB) has established itself as maritime leader in port development,

privatisation and specialised cargo handling in India. It is also the first maritime board of the

country created with a vision "To enhance and harness ports and international trade as vehicles

for economic development"

Traffic at GMB ports have consistently increased and in 2014-15 non-major ports of Gujarat

handle about 32% of total national traffic. During the same period, share of major ports has

decreased from 94% in 1982 to 55% in 2015, whereas Gujarat’s share accounts for 71.5% of

traffic for non-major ports of India in 2014-15.

GMB institutionalised the concept of integrated port-led development of its minor ports,

supported by last mile rail/road connectivity. This was effectively implemented by bringing right

private partners through several pioneering models of privatization such as privatizing port

services, private jetties, joint venture ports and Greenfield ports etc.

Source: www.gmbports.org

Goal 5 - Develop Corridor Infrastructure to augment cross-sector potential of the state

Delhi Mumbai Industrial Corridor (DMIC) – An emerging Mega-region in India

Delhi Mumbai Industrial Corridor (DMIC) Project is a Government of India programme constituted with the aim of creating futuristic Industrial Cities by leveraging the "High Speed - High Capacity" connectivity backbone provided by Western Dedicated Freight Corridor (DFC) with an estimated investment of USD 100 Bn. It is conceived to be developed as a Model Industrial Corridor of international standards with emphasis on expanding the manufacturing and services base and develop DMIC as the ‘Global Manufacturing and Trading Hub’. The programme has been conceptualized in partnership and collaboration with Government of Japan. It is envisaged that most of the projects in DMIC region would be implemented through Public-Private Partnership through Special Purpose Vehicles. High impact Integrated Investment Region (IRs) and Industrial Areas (IAs) are identified at strategic locations within the Project Influence Region to provide transparent and investment friendly facility regimes. These regions are proposed to be self-sustained industrial townships with world-class infrastructure, road and rail connectivity for freight movement to and from ports and logistics hubs, served by domestic/ international air connectivity, reliable power and other quality social infrastructure, and provide a globally competitive environment conducive for setting up businesses. An Investment Region (IR) would be a specifically delineated industrial region with a minimum area of over 20,000 hectares and an Industrial Area (IA) would be developed with a minimum area of over 10,000 hectares. 24 such special investment nodes - 11 IRs and 13 IAs spanning across six states have been identified under this flagship programme of Government of India

Source: http://dmicdc.com/about-dmicdc

City of Chicago’s Industrial Corridor Modernization Initiative

In March 2016, the Chicago Department of Planning and Development initiated a public process to refine land use policies for continued growth and private investment in the City’s industrial corridor system. The process is a multi-year one incorporating community-based goals, market data, infrastructure assessments, financial planning, and other criteria into framework plans that will guide future public and private investments within each unique corridor. The goals of the initiative are to unleash the potential of select industrial areas for advanced manufacturing and technology-oriented jobs while reinforcing traditional industrial

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activities in other area; maintain and improve the freight and public transportation systems that serve industrial users; support new job growth and local job opportunities; and leverage the unique, physical features of local industrial corridors to foster demand. In May 2017, after a year of public engagement and planning, the plan was adopted and a framework was created for land use parameters, transportation improvement, and open space amenities for 760 acres of land along the Chicago river. The implementation of the plan started in July 2017.

Toronto-Waterloo Innovation Corridor (Canada)

The Toronto-Waterloo Innovation Corridor aims to build a top-tier innovation ecosystem within Canada, catalysing growth in the region and across Canada. The corridor will become a world-class technology supercluster, drawing talent, capital and innovative ideas. Today, the corridor represents 17% of Canada’s GDP, is home to a large number of tech companies and is one of the world’s most sophisticated financial sectors. The corridor includes several surrounding municipalities over a region of more than 7000 sq km. There is a critical mass of universities and incubators to supply the needs of a growing cluster. There are more than eight universities and six incubation centres; Ryerson University and University of Toronto being key anchors for many of them. The corridor presently employs over 205,000 tech workers, second only to Silicon Valley. Other advantages that encourage cluster growth – Toronto is ranked the 4th most liveable city in the world, Canada will have tariff-free access to over 60% of global GDP if ongoing free trade agreement negotiations are successful, a strong concentration of financial services sector that welcomes innovation. Upgrading the Toronto-Waterloo Corridor to a global innovation hub has the potential to deliver a USD 50 billion increase in direct equity value, USD 17.5 billion in direct annual GDP and more than 170,000 high-quality jobs by 2025.

Source: https://thecorridor.ca/; https://www.mckinsey.com/global-themes/americas/the-toronto-waterloo-innovation-corridor

Goal 6 - Attract large investments in infrastructure sector

Land pooling strategy for infrastructure development

Land pooling offers many advantages and is an efficient way of overcoming one of the most significant challenges for infrastructure projects – land acquisition. It provides an opportunity for planned development of in an area, avoiding the problems arising from mixed land use, irregular parcel shapes, “leap-frog” development and inconsistent distribution of people and resources. Since many plots on urban fringes are not for sale, it is difficult to find sufficient plots next to each other, and this leads to infrastructure projects, even vital ones, getting delayed or even stalled indefinitely. One of the biggest ongoing land pooling projects in India is under the Delhi Land Pooling Policy. It is expected to make available 24 lakh dwelling units in the next five years. 89 of the 95 villages under this policy have been declared as urbanised. Under the policy, landowners can pool their land and give it to the Delhi Development Authority (DDA) for development works such as roads, schools, hospitals, water, power, sewage lines. Once developed, landowners get back 48% to 60% of their land, and DDA or the private builder retains the rest.

Sovereign funds eyeing Infrastructure sector in India

Sovereign wealth funds have been active in India and are sought after by green energy firms as they offer so-called patient capital, which seeks modest returns over time. These funds include Investment Corporation of Dubai, Singapore’s GIC Pte Ltd, Abu Dhabi Investment Authority and Abu Dhabi’s Mubadala Development Co. According to a report last year by investment bank Ambit Corporate Finance and the City of London, global pension funds and sovereign wealth funds may invest up to $50 billion in India’s infrastructure sector over the next five years.

Abu Dhabi Investment Authority (ADIA) will invest $1billion in the National Investment and Infrastructure Fund (NIIF), marking the start of India's ambitious attempt to raise equity funds for the infrastructure sector.