Avinash C. Mannan Affordable Housing and Infrastructure Revolution for ... · Affordable Housing...

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Affordable Housing and Infrastructure

Revolution for Rural India

Avinash C. Mannan

Group Chairman, Mannan Group, India

Managing Partner, Tawasul Al Umam General Trading & Contracting, Kuwait

http://www.thebig5constructindia.com/

About the Presenter


Avinash Mannan is a senior construction, infrastructure, and real estate executive with over 40 years of experience. He is Group Chairman & CEO of Mannan Group, a group of companies in the engineering, construction, infrastructure development, and industrial manufacturing space. Avinash started his career as a Project Engineer at Patel Engineering Company and was assigned to the Dakpathar Power Station at Yamuna Hydel Project.

He later joined the National Buildings Organization, Ministry of Works and Housing, New Delhi as Assistant Director of Design upon successfully passing the Indian Engineering Services National Examination in 1974. He then embarked on what has now culminated into a four decade long career in the Middle East and has been responsible for leading some of the most noteworthy projects in the region. Avinash has been the recipient of various national and international awards, including the Hind Ratan(2007), Navratan (2008), Glory of India (2009) and Bharat Gaurav Awards, and in 2015, was included in the Forbes List of Top Indian Leaders in the Arab World (Owners). Avinash received his Bachelors in Engineering from Thapar University in Patiala who conferred him the Distinguished Alumni Award at the 2008 annual convocation.


Today’s Discussion


1. Rural India Past, Present, and Future Opportunity

2. Current State and Challenges

3. The Opportunity Ahead

4. Business Case and Financial Summary

5. Global Best Practices and Lessons Learned

6. Final Summary: The Path Forward


The Past


• Pre Independence, foreign invaders did selective

development as per their own needs – development of

an occupied country is never a priority!

• Development was compromised and particularly rural

areas were solely treated as revenue collection points

• Post Independence, the focus moved and pace of

development changed

• We have certainly come a long way but how much

has really changed in rural India?


The Present


• Change has come due to the

development and exposure of rural

poplation to the outside world

• Lifestyle has changed with modern

gadgets but wider infrastructure upgrade

and development has not been far

reaching

• New India will require a targetted focus

on rural India where we have lagged for

far too long, inorder to be truly inclusive.


Case Study 1: Ariel View Of Village Thriewal In 2003



Village Thriewal in 2017, as is evident not much has changed



Case Study 2: Ariel View of Village Bhilowal in 2003



Village Bhilowal in 2017, again not much has changed



Rural India: Current State and Challenges(Source: World Economic Forum)


Key roadblocks to unleashing the potential of millions:

• Agricultural Productivity: India’s productivity levels are amongst the lowest in the world. Small land

holdings, limited mechanization, and lack of dedicated cold storage and infrastructure hinders our ability to

match global agricultural standards

• Rural Resource Development and Employability: Agriculture share of GDP has fallen from ~30% in

1990s to ~12% in 2016. However, number of people dependent on agriculture for livelihood has not

reduced. India’s development and growth has not been inclusive

• Lack of Table Stakes Amenities: India lags behind its contemporaries in health, nutrition and education -

from lakhs of unfilled teacher jobs in rural primary schools to the inability for millions to access basic

amenities like clean drinking water, electricity and sanitation


Rural India: Current State and Challenges(Source: World Bank)


Key Takeaways

• Over 40% of the Indian population defecates in the open.

• A result of poor planning, haphazard development, and lack of continuous maintenance

• Other countries that stand out in this list are in Africa


A lot is being done


• Several well intentioned and transformational

schemes have been launched by

Government of India

• Honourable Prime Minister of India has

aimed for 2022 to be a landmark year, for a

‘New India’

• ‘New India’ will require a targeted focus on

rural development, in order to be truly

inclusive


Schemes and Initiatives currently in place


Pradhan Mantri Gram Sinchai Yojana (PMGSY) Saur Sujala Yojana

Pradhan Mantri Garib Kalyan Yojanaye (PMGKY) Ek Bharat Shreshtha Bharat

Pradhan Mantri Jan Aushadhi Yojana (PMJAY) Green Urban Transport Scheme (GUTS)

Make in IndiaPradhan Mantri Khanij Kshetra Kalyan Yojana

(PMKKKY)

Swachh Bharat Abhiyan Namami Gange Project

Kisan Vikas Patra Pradhan Mantri Ujjwala Yojana

Soil Health Card Scheme Rashtriya Gram Swaraj Abhiyan

Digital India Pradhan Mantri Awas Yojana – Gramin

Skill India Unnat Bharat Abhiyan




Beti Bachao, Beti Padhao Yojana National Bal Swachhta Mission

Deen Dayal Upadhyaya Gram Jyoti Yojana

(DDUGJY)Smart City Mission

Deen Dayal Upadhyaya Grameen Kaushalya Yojana

(DDUGKY)Startup India, Standup India

Pandit Deendayal Upadhyay Shramev Jayate

Yojana (PDUSJY)Integrated Power Development Scheme (IPDS)

Atal Mission for Rejuvenation and Urban

Transformation (AMRUT)Shyama Prasad Mukherji Rurban Mission

Swadesh Darshan Yojana‘Prakash Path’ – ‘Way to Light’ – The National LED

Programme

Udaan Scheme UJWAL Discom Assurance Yojana (UDAY)




Pradhan Mantri Gramin Digital Saksharta Abhiyan

(PMGDSA)Pradhan Mantri Yuva Yojana (PMYY)

Universal Basic Income Scheme Pradhan Mantri Rojgar Protsahan Yojana (PMRPY)

Pradhan Mantri Jan Dhan Yojana (PMJDY) Gram Uday Se Bharat Uday Abhiyan

Pradhan Mantri MUDRA Yojana (PMMY) Pradhan Mantri Surakshit Sadak Yojana

Pradhan Mantri Suraksha Bima Yojana (PMSBY) Pradhan Mantri Gram Parivahan Yojana

Pradhan Mantri Awas Yojana - Urban (PMAY-U) Right to Light Scheme

Sansad Adarsh Gram Yojana (SAGY) Digital Village Scheme

Pradhan Mantri Fasal Bima Yojana (PMFBY) Urja Ganga


Implementation remains the major challenge


• Despite the right intention and welfare schemes there is often little change visible on the ground

• As per my interaction with Panchayats of a few villages, grants are coming in but not enough for

development

“A former prime minister of this country has gone on record to say that out of one

rupee spent by the government for welfare of the downtrodden, only 15 paise thereof

actually reaches those persons for whom it is meant. It cannot be doubted that with

UID/Aadhaar much of the malaise in this field can be taken care of,” a bench of

Supreme Court Justices AK Sikri and Ashok Bhushan said


Rural Development – A Missed Opportunity


• The present situation is not a problem but a Great Opportunity!

• Growth in last three decades has transformed India, however, rural India hasn’t grown at the same

pace as urban centres

• Integrated sustainable development has to be brought to each village

• Participation of the private sector is required


Rural Development can serve as a catalyst to

India’s need for rapid urbanization (Source: McKinsey Global Institute)



Four Primary Areas of Focus


HOUSING

• Affordable housing for landless

• Upgrading existing habitats

• Long term affordable loans as an

enabler

SERVICES

• Village access roads and internal

streets

• Electricity and Gas connections

• Communication

• Transport

• Canal embankments/bridges

WATER AND SANITATION

• Potable water via distribution systems

• Toilets

• Drainage systems and treatment plants

• Eradication of open pond systems

PUBLIC UTILITIES

• Panchayat government

• Schools

• Healthcare Facilities

• Trade Training workshops


Key elements required for successful implementation


• 10-year Development Plan (including village, block, district level plans)

• Rural India Development Authority

• National Technical Support Agency

• Financial Control by Central Agencies

• Stakeholder Engagement – Central and State Govt., Development Officers, Panchayats, NGOs, Banks, Corporate and Private investors

• Engage planning, financial, technical and legal experts in advisory capacity

• Execution involvement by Corporate Sector (Consortia or JVs) monitored by program managers tracking benefits realization



• Conduct a citizen-led, comprehensive strategic planning process

• Seek broad range of resources to implement strategic plan, with emphasis on mobilizing local and regional resources that will continue to support

• Develop and track benchmarks and performance indicators; report regularly on progress

• Conduct annual independent audits of all funds, government or private

• Objective must include community empowerment, devote resources to achieve this by developing skills of citizens

• Emphasize broad-based citizen participation in all phases of the development, implementation, and evaluation of the strategic plan.

Development Plan Implementation


The Business Case – Inputs and Assumptions


• Number of Villages – 6,49,481

• Number of Blocks – 6,612 (2012)

• Number of Districts – 651 (2012)

• Total States – 35

• Rural Population – 83,30,87,662

• Number of Panchayats – 2,38,617 (2013)

• Each Panchayat on an average represent (83,30,87,662 / 2,38,617) - 3491 population

• Most villages have population up to 500 and few up to 10,000. Number of villages are combined to make a panchayat of an average 2500-3000 population

• For development to a minimum habitable

standard, each panchayat needs Rs. 5 CR

budget over a 5-year period released in a

planned manner.

• This equates to a per capita of about Rs.

14,332 per 5 years, which is Rs. 2,864 per

year, and Rs. 240/Month

• On the next slide, I will walk you through the

breakdown on a village, block, and district

level to outline the budget required at each

level over a 5-year period


The Business Case: Village Development Plan, a

$260B Opportunity


Village Development Plan

• Rs. 5 Cr per Panchayat for infrastructure development except roads (A)

• Rs. 2 Cr per Panchayat for road and connectivity (B)

• Number of Panchayats – 2,38,617 (2013)

• Total Budget for VDP: Rs. 16,70,319 Cr (~$260B)

• Village Development Plan will encompass all development activity under the purview of Panchayatas well as connectivity to block level roads


The Business Case: Block Development Plan, an

additional $100B Opportunity in additional to

Village Development


Block Development Plan

• Block Development Plan will include the entire village development plan of the particular block and any infrastructure and connectivity within the block (e.g. medical, education, safety and administration)

• Rs. 100 Cr per block for infrastructure and connectivity

• Number of Blocks – 6,612 (2012)

• Total Budget for BDP: Rs. 6,61,200 Cr + Rs Rs. 16,70,319 Cr (~$365B)


The Business Case – District Development Plan


District Development Plan

• District Development Plan will include the all development at panchayat and block level within the district and village and any infrastructure and connectivity to district roads and national highways

• Total Budget Required: Rs. 23,31,519 Cr (~$365B)

• Number of Districts – 651 (2012)

• Total Budget allocated per district: Rs. 3,581 Cr (~$56M)

Note, we have not included any large medical and state level education system as those will be covered under Urban Development Plans. Also these figures are indicative of the potential opportunity. Upon examining the needs at a per village/district level the size of the opportunity may well surpass $700 B


Lessons Learned from Successes around the World


United States Department of Agriculture and Rural Development (USDA) -

Rural Economic Area Partnership Program (REAP)

Targeted effort by the Government of Jordan leading to a sharp decline in

poverty levels in less than two decades

Pay it Forward Initiative– Actor Matt Damon

Egypt has made considerable progress in providing pure drinking water,

which now reaches all citizens in both urban and rural areas. In 2004, a

presidential decree grouped all water and sanitation entities under one

holding company to reorganize the public water sector


Proposed path ahead for the Public and Private

Sectors to serve the bottom of the pyramid


• An Integrated Approach: Success will depend on our combined efforts and not by working in silos. This effort will require deep accountability on the part of all stakeholders

• Private Investors as a Catalyst to Change: The scale of this opportunity will pike the interest of any investor. This is a massive opportunity and one that should not be neglected

• Leveraging Global Best Practices: We must learn from the mistakes and lessons from similar development efforts in Europe, the US, and the Middle East

• Unique Operating Models: It is time for the government to open this sector to involvement from within and abroad to facilitate the execution of DDPs on PPP or BOT basis.


Conclusion


• Rural development is not just a social responsibility but a viable business opportunity

• Private participation has made a real difference across the globe

• A global economic power in the making, India must achieve status of a fully developed nation

including its rural backyards

• All of us dream to live and work in our own neighborhoods

• My dream as a village lad is Gram Vapsi Abhiyan


Let us Develop Rural India for the 21st Century

and unleash the potential of a billion people!



Jai Hind



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