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A Brief Summary of the Indian Transportation Sector: Statistics & Funding Sources

Statistics & Funding Sources of Indian Transportation Sector

By Gargi SharmaPublished 4 months ago 4 min read

India has a sizable and varied transport industry that serves 1.1 billion people. Road transport accounted for most of the sector's 5.5% contribution to the country's GDP in 2007.

Urban and rural regions must have good physical connectivity for economic growth. Demand for transport services and infrastructure has increased since the early 1990s because of India's expanding economy. For the transportation of goods, whether in urban or rural, mini trucks play an important. A modernized truck for narrow and congested roads, such as Tata Ace, will suit the deed.


Today, India's primary means of transportation are its roads. They transport over 60% of the freight and approximately 85% of the country's passenger traffic. The highway network in India has a density of 0.66 kilometres of roads per square kilometre of land.

However, 33% of India's villages need access to all-weather roads, and most of its highways have so much crowd, are small, and of poor surface quality. However, transportation is a part of their lives, but it is uncomfortable and sometimes, even dangerous for them. For passenger transportation in rural areas, a powerful magic enhanced with advanced features, for example, Tata Magic, suits the best.

Urban Transportation

India is rapidly urbanizing; the country now has a 30% urbanization rate, which equates to over 340 million people living in urban areas. Forty-two cities have a population of one million or more, and the urban economy generates around 60% of the global GDP.

Like other developing economies, India has double-digit rates of motorization. Only 3–4 cities can claim a mass rapid transit system, and only around 20 out of 87 cities with a population of more than 500,000 and state capitals have some organized transportation.

Between 1994 and 2007, the percentage of public transit in cities with a population of over 4 million fell from 69% to 38%. The poor and disadvantaged who lack access to transit suffer the worst accident and death rates in the world.

India's southern and southwestern regions have more developed transport infrastructure than the rest of the nation.

World Bank Assistance

The World Bank has made noteworthy investments in India's transport industry. Its portfolio now has 10 transportation-related projects, including seven state-related road projects and one each for a national highway, rural road, and urban transportation.

As of June 2011, there were 14 projects totalling US$5.9 billion in loan commitments for India's transportation industry. The primary tasks are as follows:

National Highway Development Project

The funding of the development of the corridors between Lucknow and Muzaffarpur is sponsered by World Bank. The Bank is also sponsoring a loan for technical support to enhance the National Highway Authority of India's operating systems and procedures, including creating a complete ERP system. Significant advancements in work zone safety procedures and road safety management have been made through these interactions.

Rural Roads Programme

This initiative aims to build all-weather roads for rural communities in the seven R-states of Uttar Pradesh, Jharkhand, Rajasthan, Punjab, Uttarakhand, Meghalaya, and Himachal Pradesh. The two rural road operations would finance the building and upgrading 24,200 km of new all-weather country roads linking around 8,200 habitations during the following five years.

The second rural roads project supports PMGSY broadly and employs a distinctive design. The project has embraced an outcomes-based methodology and is more concerned with achieving those objectives than with the specific transactions that got there. Bank money will be released in accordance with the fulfilment of agreed-upon results expressed as several disbursement link indicators.

State Highway Projects

The renovation of the state highways is under construction in the states of Andhra Pradesh, Mizoram, Tamil Nadu, Punjab, Himachal Pradesh, Orissa, and Karnataka, . These projects aim to enhance the overall capacity of the transport sector agencies, including the development of long-term finance and asset management plans and road safety management skills, in addition to enhancing the core road network's capacity in the project states.

The Sustainable Urban Transport Project encourages greater use of environmentally friendly transport methods by implementing demonstration projects in a few cities, prioritizing public and non-motorized transportation. The initiative also promotes the development and use of sustainable urban transport systems.

Eastern Dedicated Freight Corridor Project

Of the 1,800 km Eastern Dedicated Freight Corridor (Ludhiana - Delhi - Mughal Sarai), the World Bank is funding the 343 km Khurja to Kanpur stretch in the first phase.

The World Bank might fund the Eastern Dedicated Freight Corridor in three phases for around 1,100 km. Additionally, it will assist in building and maintaining the infrastructure network of the Dedicated Freight Corridor Corporation (DFCCIL).

In addition, Besides those mentioned above, the Bank is also engaged in developing different analytical works (AAA) in India's transportation industry. These consist of the following:

Public-Private Partnership

In conjunction with the GOI, several states, and urban local authorities, the Bank is actively working to develop the PPP policy framework in the transport sector. Along with funding a portion of the Karnataka highway PPP programme and providing direct construction financial assistance for the modified annuity contracts, the Bank also offers transaction consulting services for structuring highway PPP programmes in Tamil Nadu, AP, and Orissa.

Indian Road Construction Sector Study

Given the significant development programmes being implemented to support the rapidly expanding economy, the supply-side limits regarding the construction sector's capacity are a serious reason for worry. The paper examines these limitations and offers remedies.


Indian Transportation is huge, and opportunities are innumerable. Freight transportation is the main source of transportation, whether cargo or passenger. In this case, vehicles such as trucks, mini trucks, auto rickshaws, magics and buses play an important role.

With the drastically increased demand for public transportation, the need for better vehicles enhanced with advanced technology that also offers great engines and mileage of fuel and cost efficiency.


About the Creator

Gargi Sharma

Hey Flocks! Gargi Sharma is a Digital Marketer. As a Lover of Brevity, She's Doing Social Media and Blog Writes in Spare Time.

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