For a nation’s growth and development it needs some basic facilities like power, water, transportation, communication, etc. These basic facilities are called infrastructure.

Infrastructure Definition

Infrastructure often refers to the equipment and structures required by the by a country or region. Most economic activities in agricultural, industrial or service sectors of the economy require basic facilities like power, water, transportation, communication, etc. These facilities are provided by permanent installations like railway lines, roads, dams, power stations, ports, satellites and so on. Skilled manpower is provided by educational institutions like schools and colleges, and health inputs are provided by hospitals. These institutions that provide the basic facilities constitute infrastructure.

Economic and Social Infrastructure

Infrastructure can be divided into two:


  • Economic infrastructure.

  • Social infrastructure.

Table 8.1 Infrastructure

Economic Infrastructure Social Infrastructure
Transportation : Road, Railways, Port and Airports. Education : Schools and Colleges
Dams Health: Hospitals, Sanitation facilities, Drinking water facilities.
Electricity : Power stations. Housing
Communication Water supply
Insurance companies
Other financial institutions

Relevance of Infrastructure

Infrastructure contributes to economic growth and development in the following ways:

  • Attracts investment that facilitates economic growth and development.

  • It increases productivity.

  • It raises the quality of life of people.

  • Improvement in social infrastructure lowers morbidity and raises life expectancy.

State of Infrastructure in India

India has made progress in railways, roads, airways, power generation, communication, port facilities, etc. In social infrastructure like literacy, education, health care and housing also progress has been achieved. But there are two major deficiencies:

  • Inadequate infrastructure development for a fast growing economy like India.

  • Poor rural infrastructure.

    2001 census figures reflect the backwardness of rural infrastructure.

  • Only 56 per cent of rural households have electricity.

  • 43 per cent rural households still use kerosene.

  • 90 per cent of rural households use bio-fuels (firewood, dry dung, etc.) for cooking.

  • 76 per cent of rural households depend on open sources like wells, tanks, ponds, lakes, canals, rivers, etc. for drinking water.

  • Tap water availability is limited to only 24 per cent.

  • Improved sanitation facilities in rural areas was only 20 per cent.

The following table shows India’s poor spending on infrastructure and inadequate infrastructure development.

Table 8.2 Infrastructure in India and other countries

Country Investment in infrastructure (% of GDP) (2013) Access to safe drinking water (%) (2012) Access to improved sanitation (%) (2012) Mobile users (1000 people) (2013) Power generation {KW 1000) (2022)
China 49 92 65 89 4715
India 30 84 35 71 1052
South Korea 29 98 100 111 520
Pakisthan 14 91 47 70 95
Indonesia 34 84 59 122 182
Source: World Development Report

India is now the fastest growing market for mobile phones. Privatisation in this area has led to growth of mobile connections. Presently Indian telecom companies are giving more than 7 million mobile connections a month. But, this growth is not seen in areas like power generation, drinking water, sanitation, etc.

Investment in infrastructure as a percentage of GDP has to be increased, Government investment alone is inadequate (only 5 per cent). The private sector also has to be involved in a big way. This is called PPP (Public Private Participation). Many successful PPP projects have come up in infrastructure all over the country. The CIAL (Cochin InterNational Airport Ltd.) is a good example of PPP in infrastructure.

Two major areas of infrastructure that pose a serious challenge in India are energy and health.


Economic activity requires energy. In olden days muscle power of human beings and power of animals like bullocks, camels, horses and donkeys were important sources of energy. Later, energy generated by sunshine, wind, falling water, streams, etc., was harnessed. In the modern world, important sources of energy are coal, petroleum products, natural gas and electricity.

Sources of Energy

Energy sources can be broadly classified into two:

  • Commercial energy

  • Non-commercial energy

Commercial energy

Commercial energy is used for commercial purposes. Coal, petroleum products, natural gas and electricity are energy resources used for commercial activities.

Non-commercial energy

Fuel wood, agricultural waste and dried animal dung are non-commercial energy resources. Non-commercial energy is used for non-commercial activities like cooking.

An important point of distinction between commercial energy and non-commercial, energy is that while the former is exhaustible with the exception of hydro-power (non-renewable), the latter is renewable.

Non-Conventional Energy Sources

Energy can also be classified into conventional and non-conventional energy. Coal, petroleum and electricity form conventional energy. They are largely non-renewable and cause pollution. There are no such-problems in non-conventional energy. Energy from the sun, wind, tides, waves, bio mass, etc., is non-conventional energy. It is renewable and nearly pollution free. Unfortunately, the technology to produce non-conventional energy on a large scale is yet to be developed.

Consumption Pattern of Commercial Energy

Presently, the pattern of energy consumption in India is as follows:

Commercial energy - 74 per cent

Non-commercial energy - 26 per cent

Commercial energy consumption:

Coal - 54 per cent

Petroleum - 33 per cent

Natural gas - 10 per cent

Hydro energy - 3 percent

During 1953-54 period, maximum power consumption occurred in the transport sector. Gradually it came down, and the industrial sector began to consume more energy. Rapid economic growth automatically calls for proportional increase in power consumption.

Trends in Sectoral Share of Commercial Energy Consumption

Agriculture, industry, services and households need energy. Presently, the share of these different sectors in energy consumption is as follows:

Table 8.3 Trends in Sectoral Share of Commercial Energy Consumption
Sector 1953-54 1970-71 1990-91 2012-13
Households 10 12 12 22
Agriculture 01 03 08 18
Industries 40 50 45 45
Transport 44 22 28 2
Others 05 07 13 13
Total 100 100 100 100

Power / Electricity

Electricity is an integral part of our life today. Important sources of electricity are hydro, thermal and nuclear plants. Electricity is generated by utilities like Electricity Boards, Corporations or Companies in the private sector. Many companies have their captive power generation plants called non-utilities.

Primary energy resources are coal, hydro carbons, hydro energy, nuclear energy, renewable energy, etc. Electricity is a secondary form of energy produced from primary energy resources.

Power Generation in India

The sources of power generation in India are given below: (2012-13 figures)

Table 8.4
Sources of Energy Percent of total
Thermal 70
Hydro and wind power 16
Nuclear (Atomic) 2
Others 12

Thermal power is the largest source of energy in India. 70 per cent of the electric energy generated is with thermal power. Coal, petroleum and natural gas are essential for thermal electricity generation. Hydro, wind and nuclear energies are less polluting. However, they account for only 30 per cent of total energy generated.

National Thermal Power Corporation (NTPC)

Established in 1975, NTPC is the largest electric energy generating company in India. Rajiv Gandhi Power Station in Kayamkulam, Kerala, is one of NTPC's power stations. NTPC has a total of 27 thermal power plants.

Rajiv Gandhi Akshaya Energy Day

August 20 — the birthday of late Prime Minister Sri. Rajiv Gandhi is celebrated as Rajiv Gandhi Akshaya Energy Day.