Admitting that infrastructure did not get the attention it deserved during its first term, the United Progressive Alliance (UPA) government is set to change tack and take lead in galvanising big-ticket investment in core sectors in the coming five years. Further, though the Left parties are no longer a roadblock, the “inclusive growth” mantra will not allow the UPA II to announce any big-bang economic reforms.

Finance minister Pranab Mukherjee’s regular Budget for 2009-10 may well spell out the UPA’s gameplan for the next two-three years. Clearly, the UPA II will pitch for increased public expenditure in infrastructure and roll out reformist measures in a piecemeal fashion.

“You cannot fail to spot the (infrastructure) deficiencies in metros such as Mumbai and Delhi. Delivery of infrastructure is now seen as a government responsibility,” a senior government functionary said. A more stable coalition gives the UPA II a horizon of 3-4 years to “put in lot more energy” into delivery of infrastructure.

Clearly, the government is expecting public investment to compensate for the fall in global demand and its adverse impact on India’s exports. “India is a domestic demand-led story. Investment (by the government) can replace exports (the demand it creates),” the functionary said.

Development, that too in a low-income country like India, is not seen as an area where the government can withdraw soon. “The expectation is government must deliver. This requires an overhaul of the public delivery system in India. The role of the government in delivering essential services is a very important part of success in India,” a policy-maker said.

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