To meet its infrastructure needs in ports, power, industrial parks, roads and some other areas, Gujarat has outlined an investment of Rs 116,993 crore, of which Rs 21,471 crore will be invested by the state government or its agencies. Projects that will be tendered out include 22 in power, amounting to an investment of Rs 55,167 crore (Rs 7,394 crore by the state), 10 (including expansions) inthe port sector, amounting to Rs 12,288 crore (Rs 343 crore by GMB), and 105 road projects with a combined investment of Rs 19,951 crore (Rs 4,932 crore by the state).

The report has taken a 10 year perspective on each sector, further breaking it into three time zones, X,Y,Z, for immediate needs, medium term requirement and long term needs. The report has formulated a new concept called the `drivers and linkages' model, to help the state understand the demand for infrastructure facilities.

According to this model, the drivers are power, ports and industrial parks. Power projects will create demand for ports due to their fuel needs (LNG particularly). Industrial parks will drive demand for transport (road and rail linkages), water supply and townships - which is being classified as linkage infrastructure. Advising the state to go in for a port-driven development, the report has opted to prioritise projects on the basis of quantifiable economic benefits, rather than regional development imperatives toensure that the projects are viable on a stand-alone basis.

The report has also taken a view that power plants are most independent in nature (regardless of their need for port facilities). The report warns that the model is applicable to the Gujarat structure of industrial development and resources and may not be replicable.

While Gujarat seems to be fairly comfortably placed in the medium term in the port sector (in fact a slight overcapacity in the short term), it will face a deficit in the power sector, despite the huge investment planned. In the short term (2000-2001), the state will see a deficit of 1,028 mws.

Completing all projects planned and bridging the equity gap of Rs 2,994 crore, will see Gujarat have a surplus of 800 mw by 2010. The report has recommended that all power projects planned for the medium term be executed much earlier and has advised the state government to start getting approvals from the Centre. One of the most ambitious plans is in the road sector, with the World Bank andthe Asian Development Bank (ADB) chipping in funds to build arterial roads being developed by the state government.

Although the state has decided to contribute close to Rs 5,000 crore to road projects, the report has warned that the government may not be able to come up with the money (considering that in the past, the actual allocations have been much lower than budgeted). With its pioneering effort in inviting private participation for the power, road and port sectors, Gujarat has always been ahead of other states in getting investment.

The new Infrastructure Agenda 2010 only seeks to take this further. For Gujarat, getting a larger share of the private infrastructure investment is critical for the simple reason that unlike most other states in India, about 42.3 per cent of the net state domestic product (NSDP) comes from manufacturing and only 23 per cent from agriculture. Creating infrastructure therefore is more of an imperative for Gujarat than for others.

Combined with Gujarat's unique economicstructure is the equally unusual revenue pattern. The state's healthy growth in revenue receipts and prudent expenditure management has kept its borrowing from the Centre to 18 per cent of revenue receipts - the lowest in the country. And yet, tax revenues have plateaued (in fact marginally dropped). What has made the difference is that tax collection efficiency has dramatically improved, a fact reflected in the highest "states-own-taxes to NSDP ratio" among states in the country.