The agency has categorised states into three categories. Gujarat, Karnataka and Maharashtra are termed front-runners; Andhra, Telangana and Haryana are among those in the middle-of-the-pack. Climbers include Bihar, Uttar Pradesh and West Bengal.
After this categorisation, CIA recommends customised strategies and action, to maximise investment.
Rajasthan and UP have been high spenders in recent years but could now be constrained by a surging debt burden. Infrastructure investments by states needs to rise to Rs 110 trillion over the next decade — or 3.5 times the estimated Rs 32 trillion in the current decade — if India is to achieve its infrastructure targets, it said on Tuesday.
Countrywide infrastructure spending over the next decade ought to be Rs 235 trillion, it said, and called for average Gross Domestic Product (GDP) annual growth of 7.5 per cent and infra spending of above 6 per cent of GDP to achieve this.
“Unless states contribute nearly 50 per cent of infrastructure investments, India’s build-out momentum could taper sharply. With private investments tepid in recent years, and fiscal limitations on central spending, states have been keeping public spending going. They will need to strengthen fiscal health and build institutional capacity to sustain far higher levels of capex,” said Sameer Bhatia, president of CIA.
The spending trajectory of 15 large states which accounted for 83 per cent of infrastructure capex during 2014-2019 would be crucial.