China’s unprecedented infrastructure building spree is stampeding ahead. The country is able to fund projects totaling trillions of dollars because it was largely unaffected by the recent global economic downturn.
Infrastructure growth plans on a large scale
Beijing, Shanghai and Guangzhou have some of the most sophisticated and integrated transport systems in the world.
- World’s largest high speed train network: China is almost finished with a 10,000-mile honeycomb train network linking major cities across an area about the size of the United States.
- National infrastructure plans: Other Chinese infrastructure plans include a nationwide toll highway system, comparable to the US interstate highway system; 1,900 miles of new urban transit systems and streamlined harbor port terminals and new airports.
- International infrastructure plans: China also has ambitions to build high-speed rail lines across Asia and India, ultimately connecting to Europe’s systems. In exchange for constructing the transcontinental lines, China would receive natural resources needed to support its various burgeoning industries. The government has already made deals with Myanmar for lithium and with Russia on a trans-Siberian link.
Infrastructure growing pains
China’s rapid transformation from a largely rural and agrarian country into an urban-oriented industrial giant is causing growing pains that even spending nine percent of GD P on infrastructure annually cannot surmount.
- Traffic congestion: Major cities are struggling to handle traffic congestion as China’s expanding middle class keeps buying cars in volumes the new road systems cannot handle. A 2010 IBM survey ranks Beijing’s “commuter pain” as tied for the world’s worst with Mexico City.
- Pollution: Vehicle emissions also contribute to the familiar opaque, yellow-gray pollution haze that afflicts most urban areas.
- Quality concerns: The recent ouster of the lead official overseeing its high-speed rail development raises questions about the construction quality of the expansive system.
Can India possibly build the necessary infrastructure — for power, water, transportation—fast enough to sustain growth and meet its economic potential? Or will the nation hurtle into a rut, unable to support its vast population and business engine with basic services?
Success will help transform India into one of the world’s 21st-century economic powerhouses. Failure condemns the country to further poverty.
- The World Economic Forum rates India’s infrastructure 89th of 133 survey countries.
- India’s transport minister admits 16,000 of nation’s 70,000 kilometers of highways “aren’t worth driving on.”
- More than 600 million Indians live without electricity, 40 percent of the country’s water is wasted in inefficient farming, and 11 percent of urban residents and 65 percent of rural villagers have no access to toilets.
Solutions for a growing India
The national government recognizes its challenges and is committed to doubling infrastructure spending to $1 trillion between 2010-2017. Officials hope the private sector will raise half the budget.
However, not every infrastructure project remains on track. The government’s “Power for All” mission continues to fall short of its goal: experts estimate that India will need 160,000 megawatts of additional capacity by 2017, alone costing $405 billion.
Foreign companies see opportunities in operating ports, airports and highway toll concessions, but become frustrated dealing with India’s famously inefficient bureaucracy.
Brazil’s growth prospects hinge on how fast it can upgrade its infrastructure.
Broad infrastructure challenges
- A 2009–2010 World Economic Forum survey rated the country’s transport /electric/water systems among the world’s worst.
- Only about one-seventh of Brazil’s roads are paved; much of the highway between its two largest cities, Rio de Janeiro and São Paulo, is only two lanes; and a bus trip between Rio and Brasilia, the country’s capital, can take 17 hours.
- Port access remains limited because of poor roads and inadequate freight rail, hobbling the country’s significant export potential, and current power production cannot support its rapid industrialization.
Infrastructure projects kicking into high gear
Winning host rights to the 2014 World Cup and the 2016 Summer Olympic Games is helping kick the country into gear to capitalize on the fast-approaching global sporting events.
- In 2010, the government committed to a $900 billion infrastructure plan. It includes construction of a $19 billion high-speed rail line from Rio de Janeiro to São Paulo, and new power plants, hydroelectric dams and ports.
- Rio plans to upgrade three major highways and create rapid bus transit lines linking game venues, downtown, the suburbs and its International Airport, which will add new runways and terminals.
- Rio also plans to revamp its port district — Porto Maravilha — by selling development rights and using an expected $1.7 billion in proceeds to help overhaul lighting, streets, sewers and water lines.