AP VISION 2029

Infrastructure-Energy, Transport and Communications - Summary

Report

Adequate supply of quality infrastructure services is widely recognized as critical in delivering growth, reducing poverty and addressing broader development goals. The double impact of Infrastructure on the society as a multiplier for economic activity and as a stimulator for social equality makes investing into infrastructure a high priority.

This paper contains overview, issues, vision and broad strategies for three infrastructure sectors – Transportation, Energy and Communications. These chapters describe the vision formulated based on opportunities and challenges specifically for transportation, energy and communication infrastructure.

1. ENERGY

The major issues and challenges faced by the sector are: Increasing difficulty in addition of low-cost of generation capacity, Significant difference between Actual Cost of Supply (ACS) and Aggregate Realization of Revenue (ARR) for APDISCOMS, High AT&C losses in comparison to global standards, Large energy demand forecasted for 2029, Need to significantly boost renewable energy share, and Institutional capacity of power utilities not being at par with global standards

Based on the understanding of the sector, a vision to aspire for has been drafted. In line with the vision, it has been proposed that growth of power sector must be guided along the principles of enabling or ensuring accessibility, availability, affordability of power for everyone, accountability of service, focus on renewable energy and energy efficiency in the system. The following are the five strategic areas the state will lay emphasis on: High Seat for Smart Energy, i.e. technologically advanced energy, Focus on Sustainability, Priority for Efficiency, Rapid Capacity Addition, and Leveraging Private Participation

    Vision Targets for Energy Sector:
  • Electrification of all rural households (5.84 lakh) either by access to grid or by DDG (Decentralized Distributed Generation) by 2018-19, in alignment with PFA Initiative Targets.
  • Maintain constant zero energy deficits, by keeping up the capacity addition and procurement of power with the pace of growing demand.
  • T&D loss level of 6% is adopted as the target for 2029 for both APEPDCL and APSPDCL. Power for All Initiative aims to reach 12% by 2019 and additional 0.6% reduction per year is needed for the next 10 years
  • Reach a 30% renewable energy share of the total energy capacity by 2029

2. ROADS

Some of the important key issues and challenges which the road sector would be facing for meeting the aspirational targets are: Land acquisition, Delays in implementation of projects, Delays due to awarding project contract, Contract Management, Poor operational & maintenance, Road Safety, Lack of private sector participation, Lack of access to funds, and Lack of Institutional capability

Some of the broad strategies suggested include :
  • Increasing accessibility & service delivery through Greenfield development:
    • Coverage Improvement Program
    • Developing ring roads around 1 million plus cities
    • Port road connectivity improvement program
    • Intelligent express way corridor development
    • Industrial corridor project
    • Beach Corridor
  • Capacity increase through strengthening existing infrastructure to improve service delivery
  • Zero tolerance initiative for road accidents
  • Efficient institution for infrastructure development
  • Road capacity addition plan

3.PORTS

The critical bottlenecks which AP ports are facing are: Capacity utilization, Operational issue, Average parcel size handled at ports, High average TRT of container vessels, and Regulatory issues

Broad Strategies:

The sector development is strategized to be developed through four pronged approach as the guiding principles discussed in the vision framework. This approach will address all the sector issues through strategic initiatives like: Improving Operational Efficiency, Strengthening Hinterland Connectivity, Port linked integrated development, and efficient institution for port sector improvement

Vision Targets for Port Sector:

Outcome Indicator Existing- FY 2014 FY 2019 FY 2023 FY 2029 Remarks
Total traffic to be handled by ports (MTPA) 141 230 308 551 Cumulative traffic
Capacity utilization (Traffic to capacity ratio) 75% 70% 70% 70% Constructing new berths and taking performance improvement measures to improve cargo handling capacity
Draft availability 15-16 17 17 19 Most of non – major ports in AP already have a draft of 16.0 meters and to handle future larger capacity vessels they need to increase their depth to 19.0m
Avg. vessel TRT 3.5 – 5.8 2.0 1.0 1.0 Vessel TRT of bulk vessels like coal is less than 1.0-1.2 days in Gangavaram and krishnapatnam
% age cargo evacuated through IWT and coastal 0.5-1% 2% 3%   30% of the cargo is moved through roads and is primarily due to inadequate connecting infrastructure

4. AIRPORTS

The key challenges faced by airports in AP include: Absence of airport infrastructure, Land acquisition, Lack of access to funds, Reluctance of airline service operators to commence operations from AP, and Institutional development

Broad Strategies:

After examining and prioritizing the issues identified through the current state assessment, there are three broad themes that are emerging for the current strategy plan: Improving connectivity, Strengthening existing and developing Greenfield infrastructure to improve service delivery, and Institution development: Setting up of Autonomous Body for sector development – AP Airport Development Company (APADC)

Outcome Indicator Existing- FY 2014 FY 2019 FY 2023 FY 2029 Remarks
Per capita air passenger trip improvement 0.3 0.04 0.05 0.10 It is arrived based on present growth passenger traffic and also assumes that in coming years the income level would increase. This would drive the number of passenger trips to increase
Share of air passenger traffic in AP to all India traffic 1% 2% 7% 10% -
Share of Air cargo from AP airport to all India traffic 0.1% 2% 5% 7% -
Number of international airports 1 1 2 3 Currently Vishakhapatnam is the only airport. By 2029 Vijayawada and Tirupati would be converted to international airport

5. RAILWAYS

Broad Strategies include: Strengthening existing railway network, Greenfield rail infrastructure development that can be met through (a) Dedicated Freight Corridor and (b) High speed rail connectivity

Vision Targets for Railways:

Outcome Indicator Existing- FY 2014 FY 2019 FY 2023 FY 2029 Remarks
Electrification of Railway line 40% - 55% 70%  
Development of high speed rail line 0 - 250 250 Hyd – Chennai (625 km) Vizag – Bangalore (1000 km)
Development of DFC 0 - 250 250 VCIC- 800km & CBIC-550km

Investment requirement

The total infrastructure investment ascertained after considering all the strategic interventions suggest that the state would require is around INR 13.10 lakh crore by FY 2029. Table below discusses the investment requirement in transport and energy sector. This investment excludes sectors like water, communication and urban infrastructure.

Consolidated sector wise investment (INR Crore)

Sector GoI GoAP Private Total Investment
Energy 89,952 2,03,700 4,51,313 7,44,966
Road 62,123 98,611 1,98,780 3,59,514
Port 8,678 4,159 70,350 83,188
Airport 2,650 250 7,300 10,200
Railways 41,253 --- 4,584 45,837
Storage 9,672 16,119 38,686 64,477
IWT 2,523 234 --- 2,757
Total 2,16,851 3,23,074 7,71,013 13,10,939

Along with huge investment requirement, GoAP would also require to mobilize land and significant numbers of workforce for developing and operating the huge infrastructure asset. Based on cursory assessment, for infrastructure development, by FY 2029 GoAP would be mobilizing around 0.39 million acres of land and would create a job for 40 lakhs people.

Land and workforce requirement in transport and energy sector

Sector Land Requirement by FY 2029 (In acres) Workforce Requirement by FY 2029 (In lakhs)
Energy (Power) 1,24,216 1.82
Road 2,07,617 30.20
Port 14,628 6.66
Airport 12,050 0.42
Railways 28,457 0.45
Storage 4,092 1.20
IWT 500 Considered in Port sector
Total 3,91,560 40.74