Analysis of Effect of Infrastructure development on growth of Chhattisgarh state with special context to roadways

 

Rajendra Rajak

 

ABSTRACT:

Chhattisgarh is a newly born state and thus the infrastructure services and its development will play a major role in the deciding the growth path of the state’s economy. Chhattisgarh is properly connected with rail, air and road. With, airways transportation being costly and rails can carry limited goods, roadways become the major carrier for the state. This brings in revenue to the state Government as well boosts investment opportunities. Hence this research paper will shed light on the effect of roadways infrastructure on the growth of Chhattisgarh state. From the research it was concluded that both the national highway length and the major district road length is affecting the growth of the state. A 1 Kilometre rise in length of national highway will result in rise of 58.9 Crore rupees of states GSDP, were as a 1 Kilometre rise in length of Major district road will result in rise of 11.813 Crore rupees of States GSDP.

 

 

INTRODUCTION:

Economic growth is directly proportional to the adequacy of infrastructure on a country. Constraints are likely to happen when there is non-availability of infrastructure [1].

 

In Indian context, traditionally the infrastructure services needed for economic growth is provided by the public sector [2]. This traditional approach is easily linkable to the associated cost of development of infrastructure and uncertainly about the returns associated [3].

 

Even if the public sector is not involved in the production of these infrastructure services, private-sector that is backed by huge inflow of cash dominates the sector. This can lead to the development of monopolies in the sector [4].

 

The investor will thus look for returns that are profitable in nature. For the investor, the return should not only be profitable but should also come in quick successions thus the cost of usage by service user will increase.

Due to the above mentioned causes the development of infrastructure services such as:-

1.   Transport (air/water)

2.   Roadways

3.   Drinking water

4.   Electrification

 

5.   Telecom, are the economic and social responsibilities of the state. The example of such can be found under PMGY i.e. prime minister’s Gramodaya Yojana.

 

 

Government in past has attempted to develop infrastructure services on non-commercial principles, but the system has collapsed multiple times in scarcity of returns from invested amount and additionally due to subsidized charges associated with its use [5].

 

 

In this research work, the most important physical infrastructure service that is being used by people, belonging to all socio-economic strata has been considered i.e. the roads. The scope of this research work is limited to understanding effect of roadways on the economy of Chhattisgarh state and knowing the present status of roadways.

 

 

Chhattisgarh is a newly born state and thus the infrastructure services and its development will play a major role in the deciding the growth path of the state’s economy. Chhattisgarh is properly connected with rail, air and road. With, airways transportation being costly and rails can carry limited goods, roadways become the major carrier for the state. This brings in revenue to the state Government as well boosts investment opportunities. Hence this research paper will shed light on the effect of roadways infrastructure on the growth of Chhattisgarh state.

 

 

METHODOLOGY:

The research adopts two methodology

1.    Slope analysis: Slope analysis is performed to know the growth rate of the variables under consideration. For the same the equation used is Y=mx+C, where Y is the variable under consideration and X is the time, while C is the intercept

2.    Regression Analysis: To know the level of relationship between dependent and independent variables regression analysis is used. For the same the equation used is Y=a₀+a₁x₁+a₂x₂+….+a_nx_n, were Y is dependent variable and x are the independent variables.

 

 

 

 

ANALYSIS:

The study period for the research work is 2005-2006 to 2014-2015.

Table 1 GSDP of Chhattisgarh

Year	GSDP crore
2005-2006	53381
2006-2007	66875
2007-2008	80255
2008-2009	96972
2009-2010	99364
2010-2011	119420
2011-2012	144382
2012-2013	163461
2013-2014	176884
2014-2015	199539

 

 

From the table 1 it is evident that the GSDP of Chhattisgarh for year 2005-2006 was 53381 crore Rupees, for the year 2006-2007 it was 66875 Crore Rupees, for the year 2007-2008 it was 80255 Crore Rupees, for the year 2008-2009 it was 96972 Crore Rupees, for the year 2009-2010 it was 99364 Crore Rupees, for the year 2010-2011 it was 119420 Crore Rupees, for the year 2011-2012 144382 Crore Rupees, for the year 2012-2013 it was 163461 Crore Rupees, for 2013-2014 it was 176884 Crore Rupees, for the year 2014-2015 it was 199539 Crore Rupees. From the figure 1 GSDP of Chhattisgarh is growing with rate of 16144 Crore Rupees. The rate of growth of GSDP obtained is positive indicating that the Chhattisgarh is a progressive state. The progressive nature of GSDP is due to multiple factors, it can be vivid investment opportunities in Chhattisgarh, easy availability of manpower and rapidly developing infrastructure in the state.

 

 

 

Figure 1 Time series analysis of GSDP of Chhattisgarh

This research work focuses upon objective of understanding the role of road infrastructure in development of Chhattisgarh state.  For addressing the objective of the research work the variables such as length of National highways, state highways, major district roads, village roads should be analysed. These variables will then be studied in association with the GSDP of the Chhattisgarh to know the extent of contribution of road infrastructure present in the state in the progress of the state.

 

 

Table 2: Length of National Highway in Chhattisgarh

Year	National Highways (in Kms)
2005-2006	2227.6
2006-2007	2227.6
2007-2008	2227.6
2008-2009	2227.6
2009-2010	2227.6
2010-2011	2227.6
2011-2012	2227.6
2012-2013	2227.6
2013-2014	2336.4
2014-2015	3073

 

From table and figure 2 it is evident that length of national highway in Chhattisgarh state is nearly constant during the study duration. Hence slope analysis will yield nominal growth rate which can be easily neglected. It can be said that the growth rate of national highways in Chhattisgarh is near stationary.

 

 

Table 3: Length of State Highway in Chhattisgarh

Year	State highways in Kms
2005-2006	3164.15
2006-2007	3342.45
2007-2008	3419.47
2008-2009	3724.25
2009-2010	5240
2010-2011	5240
2011-2012	5240
2012-2013	5240
2013-2014	5080
2014-2015	4374.45

 

From table and figure 3 it is evident that the length of State highway in Chhattisgarh for year 2005-2006 was 3164.15 Kilometres, for the year 2006-2007 it was 3342.45 Kilometres, for the year 2007-2008 it was 3419.47 Kilometres, for the year 2008-2009 it was 3724.25 Kilometres, for the year 2009-2010 it was 5240 Kilometres, for the year 2010-2011 it was 5240 Kilometres, for the year 2011-2012 5240 Kilometres, for the year 2012-2013 it was 5240 Kilometres, for 2013-2014 it was 5080 Kilometres, for the year 2014-2015 it was 4375.45 Kilometres.  From the figure it is evident that the length is following a positive trend of increasing with 222.46 Kilometre of state highway getting added to the total every year.

 

Figure 3 Time series analysis of Length of state Highway in Chhattisgarh

 

 

Table 4: Length of Major district road in Chhattisgarh

Year	Major District Road in Kms
2005-2006	3687.73
2006-2007	3699.13
2007-2008	3829.53
2008-2009	6191.5
2009-2010	7988
2010-2011	10539.8
2011-2012	10539.8
2012-2013	10539.06
2013-2014	11141.39
2014-2015	11110.6

 

 

 

From table and figure 4 it is evident that the length of Major district road in Chhattisgarh for year 2005-2006 was 3687.73 Kilometres, for the year 2006-2007 it was 3699.13.45 Kilometres, for the year 2007-2008 it was 3829.53 Kilometres, for the year 2008-2009 it was 6191.5 Kilometres, for the year 2009-2010 it was 7988 Kilometres, for the year 2010-2011 it was 10539.8 Kilometres, for the year 2011-2012 tit was 10539.8 Kilometres, for the year 2012-2013 it was 10539.06 Kilometres, for 2013-2014 it was 11141.39 Kilometres, for the year 2014-2015 it was 11110.6 Kilometres. From the figure 4 it was evident that the length of Major district roads is increasing at rate of 1018.5 Kilometres per year.

 

Figure 4 Time series analysis of Length of state Highway in Chhattisgarh

 

 

Table 5: Length of rural road in Chhattisgarh

Year	Rural Road in Kms
2005-2006	25100.97
2006-2007	24584.31
2007-2008	24835.86
2008-2009	22183.96
2009-2010	15443
2010-2011	14523
2011-2012	14523
2012-2013	14523
2013-2014	13539.74
2014-2015	13674.44

 

 

 

From table and figure 5 it is evident that the length of rural road in Chhattisgarh for year 2005-2006 was 25101 Kilometres, for the year 2006-2007 it was 24584.3 Kilometres, for the year 2007-2008 it was 24835.9 Kilometres, for the year 2008-2009 it was 22184 Kilometres, for the year 2009-2010 it was 15443 Kilometres, for the year 2010-2011 it was 14523 Kilometres, for the year 2011-2012 it was 14523 Kilometres, for the year 2012-2013 it was 14523 Kilometres, for 2013-2014 it was 13539.7 Kilometres, for the year 2014-2015 it was 13674.4 Kilometres. From the figure 5 it is evident that the length of the rural roads is decreasing with a rate of -1549.2 Kilometres per year. This decline in the road length might be due to the fact that the number of districts since the formation of state of Chhattisgarh is on the rise and new districts are being created by bifurcating the existing districts. When bifurcation is done some of the regions become district headquarter and roads gets classified as Major district road or other district road (the rising trend of major district road noticed in figure 4 justifies the fact), hence the rural roads length is declining in Chhattisgarh. 

 

Figure 5 Time series analysis of Length of rural roads in Chhattisgarh

 

 

Regression analysis

The length of national highways and major district road is showing an increasing trend. The variables length of state highway and rural road is showing a declining pattern in nature. This declining in their length can be due to upgradation of highways in the state. Hence in regression analysis only length of national highways and length of major district roads is considered and their effect on GSDP will be studied. The GSDP of the state is considered as dependent variable were as the length of national highway and major district road is considered as independent variable.

 

 

Table 6 Regression Analysis outcome

	Coefficients	P-value
Intercept	-110486	0.058337
National Highways (in Kms)	58.93105	0.03469
Major District Road	11.81348	0.000346

Significance F: 0.0002, R-Square: 0.9121

 

From the table 6 it is evident that the both the national highway length and the major district road length is affecting the growth of the state. It can be deduced from the table that a 1 Kilometre rise in length of national highway will result in rise of 58.9 Crore rupees of states GSDP, were as a 1 Kilometre rise in length of Major district road will result in rise of 11.813 Crore rupees of States GSDP.

 

RESULT:

From the analysis, it can be concluded that

1.        The length of rural roads is decreasing, this might be due to upgradation of rural roads to major district roads. From regression analysis, the increase in district level infrastructure is boosting the economy of the state. Hence, it can be said that, major district roads have significant relationship with economy and growth of the state.

2.        The increase in length of national highway promotes the economy of the state. This depicts that the more the increase in length of national highway the better progress the state will make. The increased length depicts easy approach to national highways from connecting infrastructure and hence better source of revenue.

 

REFERENCES:

1.             Anghelache, C., Pagliacci, M. G., Bugudui, E., and Prodan, L. (2013). Multiple regression used in macroeconomic analysis. Revista Romana de statistica, 134-140.

2.             Boopen, S. (2006). Tansport infrastructure and economi growth: Evidence from Africa using dynamic panel estimates. The empirical economics letters, 37-55.

3.             Fallon, D. (2003). Linkages between infrastructure and economic growth. Wellington: Ministry of Economic Development .

4.             Haskins III, C. B. (2002). The influence of highways on rural economic development: Evidence from North Carolina. North Carolina: University of North Carolina.

5.            Jouanjean, M. (2013). Targeting infrastructure developmet to foster agricultural trade and market intergration in developing countries: an analytical review. Chicago: ODI.