Affordable Housing and Infrastructure Revolution for Rural India Avinash C. Mannan Group Chairman, Mannan Group, India Managing Partner, Tawasul Al Umam General Trading & Contracting, Kuwait
About the Presenter Avinash Mannan is a senior construction, infrastructure, and real estate executive with over 40 years of experience. He is Group Chairman & CEO of Mannan Group, a group of companies in the engineering, construction, infrastructure development, and industrial manufacturing space. Avinash started his career as a Project Engineer at Patel Engineering Company and was assigned to the Dakpathar Power Station at Yamuna Hydel Project. He later joined the National Buildings Organization, Ministry of Works and Housing, New Delhi as Assistant Director of Design upon successfully passing the Indian Engineering Services National Examination in 1974. He then embarked on what has now culminated into a four decade long career in the Middle East and has been responsible for leading some of the most noteworthy projects in the region. Avinash has been the recipient of various national and international awards, including the Hind Ratan (2007), Navratan (2008), Glory of India (2009) and Bharat Gaurav Awards, and in 2015, was included in the Forbes List of Top Indian Leaders in the Arab World (Owners). Avinash received his Bachelors in Engineering from Thapar University in Patiala who conferred him the Distinguished Alumni Award at the 2008 annual convocation.
Today s Discussion 1. Rural India Past, Present, and Future Opportunity 2. Current State and Challenges 3. The Opportunity Ahead 4. Business Case and Financial Summary 5. Global Best Practices and Lessons Learned 6. Final Summary: The Path Forward
The Past Pre Independence, foreign invaders did selective development as per their own needs development of an occupied country is never a priority! Development was compromised and particularly rural areas were solely treated as revenue collection points Post Independence, the focus moved and pace of development changed We have certainly come a long way but how much has really changed in rural India?
The Present Change has come due to the development and exposure of rural poplation to the outside world Lifestyle has changed with modern gadgets but wider infrastructure upgrade and development has not been far reaching New India will require a targetted focus on rural India where we have lagged for far too long, inorder to be truly inclusive.
Case Study 1: Ariel View Of Village Thriewal In 2003
Village Thriewal in 2017, as is evident not much has changed
Case Study 2: Ariel View of Village Bhilowal in 2003
Village Bhilowal in 2017, again not much has changed
Rural India: Current State and Challenges (Source: World Economic Forum) Key roadblocks to unleashing the potential of millions: Agricultural Productivity: India s productivity levels are amongst the lowest in the world. Small land holdings, limited mechanization, and lack of dedicated cold storage and infrastructure hinders our ability to match global agricultural standards Rural Resource Development and Employability: Agriculture share of GDP has fallen from ~30% in 1990s to ~12% in 2016. However, number of people dependent on agriculture for livelihood has not reduced. India s development and growth has not been inclusive Lack of Table Stakes Amenities: India lags behind its contemporaries in health, nutrition and education - from lakhs of unfilled teacher jobs in rural primary schools to the inability for millions to access basic amenities like clean drinking water, electricity and sanitation
Rural India: Current State and Challenges (Source: World Bank) Key Takeaways Over 40% of the Indian population defecates in the open. A result of poor planning, haphazard development, and lack of continuous maintenance Other countries that stand out in this list are in Africa
A lot is being done Several well intentioned and transformational schemes have been launched by Government of India Honourable Prime Minister of India has aimed for 2022 to be a landmark year, for a New India New India will require a targeted focus on rural development, in order to be truly inclusive
Schemes and Initiatives currently in place Pradhan Mantri Gram Sinchai Yojana (PMGSY) Pradhan Mantri Garib Kalyan Yojanaye (PMGKY) Pradhan Mantri Jan Aushadhi Yojana (PMJAY) Make in India Swachh Bharat Abhiyan Kisan Vikas Patra Soil Health Card Scheme Digital India Skill India Saur Sujala Yojana Ek Bharat Shreshtha Bharat Green Urban Transport Scheme (GUTS) Pradhan Mantri Khanij Kshetra Kalyan Yojana (PMKKKY) Namami Gange Project Pradhan Mantri Ujjwala Yojana Rashtriya Gram Swaraj Abhiyan Pradhan Mantri Awas Yojana Gramin Unnat Bharat Abhiyan
Schemes and Initiatives currently in place Beti Bachao, Beti Padhao Yojana National Bal Swachhta Mission Deen Dayal Upadhyaya Gram Jyoti Yojana (DDUGJY) Smart City Mission Deen Dayal Upadhyaya Grameen Kaushalya Yojana Startup India, Standup India (DDUGKY) Pandit Deendayal Upadhyay Shramev Jayate Yojana (PDUSJY) Integrated Power Development Scheme (IPDS) Atal Mission for Rejuvenation and Urban Transformation (AMRUT) Shyama Prasad Mukherji Rurban Mission Swadesh Darshan Yojana Prakash Path Way to Light The National LED Programme Udaan Scheme UJWAL Discom Assurance Yojana (UDAY)
Schemes and Initiatives currently in place Pradhan Mantri Gramin Digital Saksharta Abhiyan (PMGDSA) Universal Basic Income Scheme Pradhan Mantri Jan Dhan Yojana (PMJDY) Pradhan Mantri MUDRA Yojana (PMMY) Pradhan Mantri Suraksha Bima Yojana (PMSBY) Pradhan Mantri Awas Yojana - Urban (PMAY-U) Sansad Adarsh Gram Yojana (SAGY) Pradhan Mantri Fasal Bima Yojana (PMFBY) Pradhan Mantri Yuva Yojana (PMYY) Pradhan Mantri Rojgar Protsahan Yojana (PMRPY) Gram Uday Se Bharat Uday Abhiyan Pradhan Mantri Surakshit Sadak Yojana Pradhan Mantri Gram Parivahan Yojana Right to Light Scheme Digital Village Scheme Urja Ganga
Implementation remains the major challenge Despite the right intention and welfare schemes there is often little change visible on the ground As per my interaction with Panchayats of a few villages, grants are coming in but not enough for development A former prime minister of this country has gone on record to say that out of one rupee spent by the government for welfare of the downtrodden, only 15 paise thereof actually reaches those persons for whom it is meant. It cannot be doubted that with UID/Aadhaar much of the malaise in this field can be taken care of, a bench of Supreme Court Justices AK Sikri and Ashok Bhushan said
Rural Development A Missed Opportunity The present situation is not a problem but a Great Opportunity! Growth in last three decades has transformed India, however, rural India hasn t grown at the same pace as urban centres Integrated sustainable development has to be brought to each village Participation of the private sector is required
Rural Development can serve as a catalyst to India s need for rapid urbanization (Source: McKinsey Global Institute)
Four Primary Areas of Focus HOUSING Affordable housing for landless Upgrading existing habitats Long term affordable loans as an enabler SERVICES Village access roads and internal streets Electricity and Gas connections Communication Transport Canal embankments/bridges WATER AND SANITATION Potable water via distribution systems Toilets Drainage systems and treatment plants Eradication of open pond systems PUBLIC UTILITIES Panchayat government Schools Healthcare Facilities Trade Training workshops
Key elements required for successful implementation 10-year Development Plan (including village, block, district level plans) Rural India Development Authority National Technical Support Agency Financial Control by Central Agencies Stakeholder Engagement Central and State Govt., Development Officers, Panchayats, NGOs, Banks, Corporate and Private investors Engage planning, financial, technical and legal experts in advisory capacity Execution involvement by Corporate Sector (Consortia or JVs) monitored by program managers tracking benefits realization
Development Plan Implementation Conduct a citizen-led, comprehensive strategic planning process Seek broad range of resources to implement strategic plan, with emphasis on mobilizing local and regional resources that will continue to support Develop and track benchmarks and performance indicators; report regularly on progress Conduct annual independent audits of all funds, government or private Objective must include community empowerment, devote resources to achieve this by developing skills of citizens Emphasize broad-based citizen participation in all phases of the development, implementation, and evaluation of the strategic plan.
The Business Case Inputs and Assumptions Number of Villages 6,49,481 Number of Blocks 6,612 (2012) Number of Districts 651 (2012) Total States 35 Rural Population 83,30,87,662 Number of Panchayats 2,38,617 (2013) Each Panchayat on an average represent (83,30,87,662 / 2,38,617) - 3491 population Most villages have population up to 500 and few up to 10,000. Number of villages are combined to make a panchayat of an average 2500-3000 population For development to a minimum habitable standard, each panchayat needs Rs. 5 CR budget over a 5-year period released in a planned manner. This equates to a per capita of about Rs. 14,332 per 5 years, which is Rs. 2,864 per year, and Rs. 240/Month On the next slide, I will walk you through the breakdown on a village, block, and district level to outline the budget required at each level over a 5-year period
The Business Case: Village Development Plan, a $260B Opportunity Village Development Plan Rs. 5 Cr per Panchayat for infrastructure development except roads (A) Rs. 2 Cr per Panchayat for road and connectivity (B) Number of Panchayats 2,38,617 (2013) Total Budget for VDP: Rs. 16,70,319 Cr (~$260B) Village Development Plan will encompass all development activity under the purview of Panchayat as well as connectivity to block level roads
The Business Case: Block Development Plan, an additional $100B Opportunity in additional to Village Development Block Development Plan Block Development Plan will include the entire village development plan of the particular block and any infrastructure and connectivity within the block (e.g. medical, education, safety and administration) Rs. 100 Cr per block for infrastructure and connectivity Number of Blocks 6,612 (2012) Total Budget for BDP: Rs. 6,61,200 Cr + Rs Rs. 16,70,319 Cr (~$365B)
The Business Case District Development Plan District Development Plan District Development Plan will include the all development at panchayat and block level within the district and village and any infrastructure and connectivity to district roads and national highways Total Budget Required: Rs. 23,31,519 Cr (~$365B) Number of Districts 651 (2012) Total Budget allocated per district: Rs. 3,581 Cr (~$56M) Note, we have not included any large medical and state level education system as those will be covered under Urban Development Plans. Also these figures are indicative of the potential opportunity. Upon examining the needs at a per village/district level the size of the opportunity may well surpass $700 B
Lessons Learned from Successes around the World United States Department of Agriculture and Rural Development (USDA) - Rural Economic Area Partnership Program (REAP) Targeted effort by the Government of Jordan leading to a sharp decline in poverty levels in less than two decades Pay it Forward Initiative Actor Matt Damon Egypt has made considerable progress in providing pure drinking water, which now reaches all citizens in both urban and rural areas. In 2004, a presidential decree grouped all water and sanitation entities under one holding company to reorganize the public water sector
Proposed path ahead for the Public and Private Sectors to serve the bottom of the pyramid An Integrated Approach: Success will depend on our combined efforts and not by working in silos. This effort will require deep accountability on the part of all stakeholders Private Investors as a Catalyst to Change: The scale of this opportunity will pike the interest of any investor. This is a massive opportunity and one that should not be neglected Leveraging Global Best Practices: We must learn from the mistakes and lessons from similar development efforts in Europe, the US, and the Middle East Unique Operating Models: It is time for the government to open this sector to involvement from within and abroad to facilitate the execution of DDPs on PPP or BOT basis.
Conclusion Rural development is not just a social responsibility but a viable business opportunity Private participation has made a real difference across the globe A global economic power in the making, India must achieve status of a fully developed nation including its rural backyards All of us dream to live and work in our own neighborhoods My dream as a village lad is Gram Vapsi Abhiyan
Let us Develop Rural India for the 21st Century and unleash the potential of a billion people!
Jai Hind
THANK YOU FOR ATTENDING Request a copy of our presentations at www.thebig5constructindia/presentations PLEASE DON T FORGET TO COLLECT YOUR ATTENDANCE CERTIFICATE