This Paper was amongst top-10 winning entries in "Opsyrus 2006", the CoolAvenues.com - OIG (IIM Lucknow) Paper Writing Competition held during Oct-Dec 2006.

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"You and I come by road or rail, but economists travel on infrastructure."

- Margaret Thatcher

Executive Summary

Economic growth is normally defined as the sustained increase in real (inflation-adjusted) per capita income (or output). The conventional definition of economic development is economic growth plus structural transformation. In fact, sustained economic growth does not occur (and cannot occur) without structural transformation reflected through reorganization, restructuring, and finding new ways of doing existing things or new things to do. Hence, the importance of infrastructure development has recently regained recognition in the development community.

The Indian economy has grown at an average eight per cent in the past three years, and a 10 per cent annual GDP growth is difficult to achieve unless the country improves its infrastructure. The prime minister, who is also the Chairman of the Planning Commission, mentioned that, "Infrastructure development is a major constraint on our industrial growth, and we would need more than Rs. 1,400,000 crore ($308 billion) by 2012."

This paper highlights the challenges faced at the Operational level while implementing the projects since, most of the infrastructural projects are delayed due to both External reasons and Internal constraints that include Socio-Political, Economic, Technological-Macro and Micro-global reasons, Human Factor, Programmes and Policies of the company. Operational Challenges faced by the Infrastructure Industry broadly includes:

In addition this paper also identifies issues in project management with respect to infrastructure development, which includes:

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* Contributed by: -
N. V. Chakravarthy,
MBA, II Year,
School of Management Studies,
University of Hyderabad, Hyderabad.