Impact Assessment of Industrial corridors – Need for Evidence Led Conclusions
By Dripto Mukhopadhyay
Industrial corridors should play role of a big booster for economic activity. It is observed that the central and the state governments in general considers expressways and industrial corridors more or less synonymously. the reason is obvious. The though process is is expressways are developed, it should attract investment towards economic activities in general, and specifically for industrial activities in the regions of expressways. A good expressway, leads to multiple link roads to these regions, which in turn reduce travel time for cargo and passengers significantly. The ease of travelling and delay related logistics costs definitely act as a big boon to traders, businesses. In one of the papers I worked earlier with Prof. Sanjib Pohit, It has been shown that on road delays in transporting goods for export consignments was to the extent of 3% of the consignment values. One can imagine amount of the actual value the exporters of the country face due to delay in transportation. The same should be true for inter-state transfer of goods also for domestic trading.
Therefore, logically speaking a better road quality and network should definitely help businesses and overall economic activities. It is also true that better connectivity should boost inter-industry linkages and hence, will boost further industrialisation in regions along the expressways. At ACRA we worked on a study on measuring likely impacts of Poorvanchal and Bundelkhand expressways in Uttar Pradesh on industrial performance of the proposed industrial corridors along these expressways. As obvious the team looked for literature on impact assessment of industrial corridors that were completed years back. This would help us in methodologies used for capturing impacts. Unfortunately, we could see only documents that used to pitch for industrial corridors by large consulting firms. There was hardly any literature that captured performance of the existing industrial corridors and the changes therein over time. Yesterday, I saw an article by Prof. Sanjib Pohit in Business Line that highlighted the need for hard data and impact assessment of the expressways. Expressways are now an integral part of infrastructure development and the budget layout has gone up significantly over time.
It is high time the government also look into assessing impacts of these expressways and the industrial corridors set up along these to go beyond the logical conclusion and measure the impacts in economic terms. Even if we set aside our own experiences of questioning why during every hundred kilometer you face patches of new activities of repairing. And, at times you cannot differentiate between a toll road and a normal road because of pathetic road condition. However, these experiences can be ignored as outliers, but the need for how these expressways are boosting industrial and other economic activities cannot be ignored.
We have decided to to work on a research paper on estimating impacts of expressways as performance booster for industrial corridors and also on overall performance of the economy of the regions in the vicinity. We will select from existing and new industrial corridors so that the impact as well as the gestation period after which these corridors start paying dividends to the business can be captured scientifically. This paper should help the business since they can invest in a more informed manner knowing their RoI on investment over time and will also help the governments in their decision making. We would love to hear from fellow researchers, especially those who work on related domain, on ideas as well as for collaborations.