Date Centre & Energy Storage Included In Infrastructure What Does It Mean (In English) – Free PDF

The News

• Recently, Union Finance Minister Nirmala Sitharaman has said data centres and energy storage system will be given infrastructure status.
• While presenting the Union Budget 2022-23, she also informed that private equity and venture capital investors invested Rs 5.5 lakh crore in startups including data centres & energy storage domain.
• Sitharaman further said an expert committee will be set up to suggest measures to help attract more investments.

What is Infrastructure?

• Despite being recognized as one of the fundamental ingredients for economic development, the term ‘infrastructure’ has not been given a definite meaning in India.
• In common parlance, infrastructure is understood as an elementary structure or service required for an economy to function.

What is Infrastructure?

• Rakesh Mohan Committee (1996) defined infrastructure to include electricity, gas, water supply, telecom, roads, industrial parks, railways, ports, airports, urban infrastructure and storage.
• For the purpose of external commercial borrowing funds, the Reserve Bank of India (RBI) has defined infrastructure to include power, telecommunication, railway, roads including bridges, sea port and airport, industrial parks, urban infrastructure (water supply, sanitation and sewage projects), mining, exploration and refining.

What is Infrastructure?

What is Infrastructure?

• Due to this lack of uniformity in usage of the term infrastructure, the Cabinet Committee on Infrastructure introduced a harmonized master list of five main infrastructure sectors and many infrastructure sub sectors to guide all the agencies responsible for supporting infrastructure in various ways.

What is Infrastructure?

• Harmonised Master List of Infrastructure notified by DEA Ministry of Finance has five sectors with multiple subsectors.
  1. Transport and Logistics
  2. Energy
  3. Water and Sanitation
  4. Communication
  5. Social and Commercial Infrastructure

Now you must be thinking…

• Once an industry is accorded infrastructure status, the sector is entitled to a number of benefits and concessions.
  1. It can raise money from insurance companies, pension funds, and international lenders with a longer tenure and on easier terms. The sector can get credit at competitive rates and on long-term basis with enhanced limits.
  2. Infrastructure status gives industries access to cheaper foreign currency funding through the external commercial borrowing route.
  3. Furthermore, it will become eligible to borrow from India Infrastructure Financing Company (IIFCL).
  4. Couple the above benefits with GST sops, Make in India sops etc
  5. One of the biggest benefit is that it ultimately leads to local job creation.

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