eco survey 2012-13 for ias aspirants

8/13/2019 Eco Survey 2012-13 for IAS aspirants

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2. Seizing the Demographic Dividend

The low growth states will benefit more from the demographic dividend, as higherincomes and lower fertility alter demographics. Labor productivity is an increasingfunction of age, with the age group 40-49 being the most productive because of work

experience. Nearly half the additions to the Indian labour force over the period 2011-30will be in the age group 30-49.

Sources of GrowthGrowth in per capita income is driven by growth in

labour productivity (what the average worker produces),growth in working age population (fewer the people who are in the dependentage group in the population, greater the output),growth in the fraction of those who can work that actually look for work ( labourforce participation rate),

growth in those looking for work who actually find it (employment rate).Total factor productivity (TFP). TFP measures how productive the job intrinsically is,capturing aspects such as the technology used, efficiency with which the work is carriedout, and use of hard-to-measure aspects of work such as tacit knowledge,organizational capabilities, and trust.

WHY IS BUSINESS NOT CREATING MORE PRODUCTIVE JOBS?

a. Impediments to the emergence and growth of businessToo many firms in India stay small, unregistered, unincorporated, largelyinformal, orin the unorganized sector because they can avoid regulations and taxes.

Little incentive to invest in upgrading skills of largely temporary workers or ininvesting in capital equipment productivity stays low. Low productivity givesthem little incentive to grow, completing the vicious circle.

b. situation of labourvariation in hiring practices across firms of different sizes in India.organized industry creates few jobscompared to unorganized industry

Why is large organized manufacturing not creating more jobs?

strict labour laws may have hindered the organized large-scale manufacturing

The labour laws are more rigidvery few workers are actually covered by these laws.consequences of strong worker protectionvariation across states' stance on regulations.


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The Nuts and Bolts of Improving Business Climate for Small Businesses*There are several regulatory changes that can be made to improve the business climate

for MSMEs.

Formulate a common policy on business development and regulation

Help business facilitation: Establish independent facilitation and coordination agencies

as PPP Simplify registrations for starting up: Create a one-stop online registrationsystem for time-bound registrations

Ease burden of compliance as the firm grows: Enable compliance ratings of MSMEs

Allow for easy exits: The arduous process of exit for unsuccessful companies needs to bemade simpler, faster, and cheaper.

Transform employment exchanges to enable effective job matching:

Improve value/benefits from statutory pre-emptions

Reduce attractiveness of staying small

The DMIC: An Integrated Approach to Industrial Growth and Development*The DMIC is being developed by the Government of India with a view to using the high-

capacity western Dedicated Freight Corridor as a backbone for creating a global manufacturingand investment destination. The project seeks to develop a series of futuristic infrastructure-

endowed smart industrial cities that can compete with the best international manufacturing and

industrial regions. The master plan has a vision for 24 manufacturing cities.

Possible socio-economic impact: The DMIC Project Influence Area of 436,486 sq. km is about

13.8 per cent of Indiasgeographical area. It extends over seven states and two union territories,viz. Delhi, Uttar Pradesh, Haryana, Rajasthan, Madhya Pradesh, Gujarat, Maharashtra, Daman

and Diu, and Dadra and Nagar Haveli. Around 17 per cent of the countrys total population will

be affected. The project goals are to double employment potential in 7 years.


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4. Prices and Monetary ManagementCONSUMER PRICE INDICES (CPIS)CPI-IW-Inflation4.14 In India, most attention, including from policymakers, is devoted to headline WPI inflation. WPI

series have a wider commodity basket, with commodity weights derived from the National Accounts,reflect the underlying economy-wide inflation better. Moreover, generalized and persistent CPI inflationcould generate high inflationary expectations amongst the public.

There have been 3 consumer price indices, before the Central Statistics Office launched the new CPIseries in January 2011, each for a specific class of consumers. The CPI for industrial workers (CPIIW),which is primarily used for wage indexation,

Inter-Ministerial Group (IMG) on InflationAn Inter-Ministerial Group (IMG) on inflation was set up on 2 February, 2011, on the recommendation ofthe Prime Minister, under the chairmanship of Chief Economic Adviser, Ministry of Finance to review theoverall inflation situation, with particular reference to primary food articles. Covering various aspects,including information system on all aspects of price monitoring, Foreign Direct Investment (FDI) in multi-

brand retail, reform in APMC Act, policy options for diesel pricing and inflation in protein rich productsamong others.

Measures Taken and Proposed by the Government to Contain Price Rise1. Fiscal measuresImport duties for wheat, onions, pulses, and crude palmolein were reduced to zero and 7.5 per cent forrefined vegetable & hydrogenated oils.Duty-free import of white/raw sugar was extended up to 30 June 2012; presently the import duty hasbeen fixed at 10 per cent.

2. Administrative measuresBan on exports of onions was imposed for short periods of time whenever required. Exports of onionswere calibrated through the mechanism of minimum export prices (MEP).

Futures trading in rice, urad, tur, guar gum and guar seed was suspended.Exports of edible oils (except coconut oil and forest-based oil) and edible oils in blended consumerpacks up to 5 kg with a capacity of 20,000 tons per annum and pulses (except Kabuli chana and organicpulses and lentils up to a maximum of 10,000 tonnes per annum) were banned. I Stock limits were imposed from time to time in the case of select essential commodities such aspulses, edible oil, and edible oilseeds and in respect of paddy and rice up to 30 November 2013.

3. The government has undertaken various measures to insulate the vulnerable sections of

society from price rise.The central issue prices (CIP) for rice (at Rs 5.65 per kg for below poverty line [BPL] and Rs 3 per kgfor Antodaya Anna Yojana [AAY] families) and wheat (at Rs 4.15 per kg for BPL and Rs 2 per kg for AAYfamilies) have been maintained since 2002.Under the targeted PDS (TPDS) allocation of foodgrains is being made to 6.52 crore AAY and BPLfamilies at 35 kg per family per month at a highly CIP.The government has allocated rice and wheat under the Open Market Sales Scheme (OMSS).

The scheme for imports of pulses which envisaged imports for distribution to BPL households throughthe PDS with a subsidy of Rs 10 per kg operated from November 2008 to June 2012. The governmenthas decided to implement a varied form with a subsidy element of Rs 20 per kg per month for BPLcardholders for the residual part of the current year. The targeted BPL cardholders will be as estimated bythe Department of Food and Public Distribution.The Scheme for Distribution of Subsidized Imported Edible Oils has been implemented since 2008-9through state/ union territory (UT) governments for distribution of 1 litre per ration card per month with acentral subsidy of Rs 15 per kg. The scheme has been extended up to 30 September 2013.


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4. Budgetary and other measuresA number of measures were announced in Union Budget 2012-13 to augment supply and improvestorage and warehousing facilities. The government launched a National Mission for Protein supplementsin 2011-12 with an allocation of Rs 300 crore. To broaden the scope of production of fish to coastalaquaculture, apart from fresh water aquaculture, the outlay in 2012-13 was stepped up to Rs 500 crore.Recently the government permitted FDI in multibrand retail trading. This will help consumers and farmers

as it will improve the selling and purchasing facilities.5. Monetary measuresThe RBI had also taken suitable steps to contain inflation with 13 consecutive increases by 375 basispoints (bps) in policy rates from March 2010 to October 2011.

5. Financial IntermediationFINANCIAL INCLUSIONMicro-Finance: Self Help Group-Bank Linkage Programme5.14 Though there are different models for pursuing micro-finance, the Self-Help Group (SHG)-BankLinkage Programme has emerged as the major micro-finance programme in the country. It is beingimplemented by commercial banks, regional rural banks (RRBs), and cooperative banks.

Extension of Swabhimaan scheme

5.15 Under the Swabhimaan financial inclusion campaign, over 74,000 habitations with population inexcess of 2,000 had been provided banking facilities by March 2012, using various models andtechnologies including branchless banking through business correspondents (BCs).

Sett ing up of Ul t ra Smal l Branches

5.16 Considering the need for close supervision and mentoring of the business correspondent agents(BCAs) by the respective banks and in order to ensure that a range of banking services are available tothe residents of such villages, ultra small branches (USBs) are being set up in all villages covered throughBCAs under financial inclusion. These USBs will comprise a small area of 100-200 sq. feet where theofficer designated by the bank will be available with a laptop on pre-determined days. While cash serviceswill be offered by the BCAs, the bank officer will offer other services, undertake field verification, andfollow up banking transactions.

Roll out o f Direct Benefi t Transfer

5.17 The Government of India has decided to introduce a Direct Benefit Transfer (DBT) scheme witheffect from 1 January 2013. To begin with, benefits under 26 schemes will directly be transferred into thebank accounts of beneficiaries in 43 identified districts across respective states and union territories (UT).Banks will ensure that all beneficiaries in these districts have a bank account.

Kisan Credi t Card Scheme

5.19 The Kisan Credit Card (KCC) has been an important initiative for universal access of farmers toinstitutional credit . The number of operative KCCs issued by cooperative banks and RRBs


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6. Balance of PaymentsGLOBAL ECONOMY6.2 There are early signs of a turnaround in the global economy. A series of measures by the euro zoneauthorities and the European Central Bank have allayed fears of an imminent meltdown.

The fiscal cliff in the US has been deferred, albeit temporarily, and there are green shoots of recovery inChina and India. As a result, growing investor optimism has translated into risk on behaviour, which hasled to a surge in capital flows to emerging economies. The renewed confidence has also led to greatrotation,with investors shifting money from safe havengovernment securities to equities in search foryield. The change is reflected in the equity market boom in advanced and emerging economies. Howeverdoubts still exist about the sustainability of the recovery.

The eurozone still faces problems such as the continuing recession; the existence of a monetary unionwithout fiscal union; the slow progress of the proposed European banking union; the continuing need forausterity in many advanced economies. In addition, fiscal tensions in the United States might re-surfacein the next few months.

Japan has still to find a reasonable way out of its decade long slump. Emerging markets continue to face

problems of overheating. All these cast a shadow on the prospects of the global economy.

BALANCE OF PAYMENT (BOP)Indias BoP during 2011-126.7 Indias BoP was under stress during 2011-12, as the trade and current account deficit widened.Though capital inflows increased, it fell short of fully financing current account deficit, resulting indrawdown of foreign exchange reserves. The trade deficit increased to US$ 189.8 billion (10.2 per cent ofGDP) in 2011-12 as compared to US$ 127.3 billion (7.4 per cent of GDP) during 2010-11. This increaseof 49.1 per cent in trade deficit in 2011-12 was primarily on account of higher increase in imports relativeto exports. Net invisible balances showed significant improvement, registering 40.7 per cent increasefrom US$ 79.3 billion in 2010-11 to US$ 111.6 billion during 2011-12. Net invisible balance as per cent ofGDP improved to 6.0 percent in 2011-12 from 4.6 per cent in 2010-11

Impact of Euro Zone Crisis on Current AccountThe unfolding of euro zone crisis, the austerity measures in advanced economies, recession in manyeuro zone countries, risk on/ risk off behaviour of investors and the uncertainty surrounding the future ofeuro zone have adversely affected the global economy.

The fallout for the Indian economy has been a sharp deceleration in exports and a slowdown in GDPgrowth. Import demand however has remained resilient because of the continued high international oilprices that did not decline. A positive development is that high CAD has lately been financed by capitalinflows, which explains why the downhill movement of rupee, witnessed till July 2012, has been largelyarrested. There has however been high dependence on volatile portfolio flows and external commercialborrowings. This makes capital account vulnerable to a 'reversal' and 'sudden stop' of capital, especiallyin times of stress.

Liberalization of FDI normsForeign Direct Investment (FDI) is preferred to the foreign portfolio investments primarily because FDI isexpected to bring modern technology, managerial practices and is long term in nature investment. TheGovernment has liberalized FDI norms overtime. As a result, only a handful of sensitive sectors now fall inthe prohibited zone and FDI is allowed fully or partially in the rest of the sectors.

Despite successive moves to liberalize the FDI regime, India is ranked fourth on the basis of FDIRestrictiveness Index (FRI) compiled by OECD. FRI gauges the restrictiveness of a country's FDI rules by


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looking at the four main types of restrictions viz. foreign equity limitations; screening or approvalmechanism; restrictions on the employment of foreigners as key personnel; and operational restrictions. Ascore of 1 indicates a closed economy and 0 indicates openness. FRI for India in 2012 was 0.273 (it was0.450 in 2006 and 0.297 in 2010) as against OECD average of 0.081.

At present, defence sector is open to FDI subject to 26 per cent cap. It also requires FIPB approval and issubject to licensing under Industries (Development & Regulation) Act, 1951 and guidelines on FDI inproduction of arms & ammunition. Within the 26 per cent cap, FII is also permissible subject to the provisothat overall cap is not breached. India needs to open up the defence production sector to get access andensure transfer of technology.

There is need to review increasing of FDI cap in insurance and public sector banks. By raising cap to 49per cent in the insurance sector, there is scope for substantial growth in the coming years. Competitionand adoption of best practices could strengthen this sector, reduce the premium and expand the servicesto the vast untapped rural India. This sector could be one of the major sources of long-term investment ininfrastructure.

FOREIGN EXCHANGE RESERVES6.24 India's foreign exchange reserves comprise foreign currency assets (FCA), gold, special drawingrights (SDRs) and reserve tranche position (RTP) in the International Monetary Fund (IMF).

Nominal Effective Exchange Rate and Real Effective Exchange RateNEER is the weighted average of bilateral nominal exchange rates of the home currency in terms offoreign currencies, while REER is defined as a weighted average of nominal exchange rates, adjusted forhome and foreign country relative price differentials. REER captures movements in cross currencyexchange rates as well as inflation differentials between India and its major trading partners and reflectsthe degree of external competitiveness of Indian products.


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7. International Tradeworld trade volume is projected to grow by 3.8 per cent in 2013 which is down 0.7 percentage pointscompared to its October 2012 update.India's merchandise trade increased exponentially in the 2000sdecade from US$ 95.1 billion in 2000-1 to US$ 620.9 billion in 2010-11 and further to US$ 793.8 billion in2011-12.

recent slowdown in exports is explained by external factorsThere are at least two reasons for the decline in export growth: (i) external factors or partner countryincomes, (ii) changes in exchange rate

Gold Imports and Policy MeasuresIndia is one of the largest importers of gold in the world, with import growth of 11.2 per cent in terms ofquantity and 39.0 per cent in terms of value during 2011-12. Gold is the second major import item of Indiaafter POL and constitutes 11.3 of its imports in 2011-12 in value terms. The rise in imports of gold is oneof the factors contributing to India's high trade deficit and CAD in 2011-12, forming 30 per cent of its tradedeficit.

India is one of the largest consumers of gold in the world with consumption increasing from 721.9 tonnesin 2006 to 933.4 tonnes in 2011 and 612 tonnes in the first three quarters of 2012, accounting for around27 per cent of world gold consumption in 2011, and 26.4 per cent in 2012 (total of first three quarters).

International gold price movements which have been volatile in recent years also have a bearing on thevalue of the country's gold imports. To restrict the rising trend in gold imports which is adversely affectingIndia's balance of payments, measures were and are being taken by the government. In Budget 2012-13,import duty on standard gold and platinum was raised from 2 per cent to 4 per cent and non standardgold from 5 per cent to 10 per cent. On 21 January 2013, the Import duty on gold and platinum wasincreased from 4 per cent to 6 per cent. It has also been proposed to provide a link between the GoldETF (Exchange Traded Fund) and Gold Deposit Scheme with the objective of unfreezing or releasing apart of the gold physically held by mutual funds under Gold ETFs and enabling them to deposit the goldwith banks under the Gold Deposit Scheme.

Trade DeficitThe trade deficit of US $ 167.2 billion for 2012- 13 (April-January) was 7.9 per cent higher than the US $154.9 billion in 2011-12 (April- January).

Trade CompositionExport compositionIn the case of India's exports to the USA, the share of exports of primary products has increased from 6.8per cent in 2009-10 to 21.3 per cent in 2012-13 (April-November), mainly due to the rise in share ofagriculture and allied products, while the share of manufactured goods in India's exports to the USA hasfallen from 89.1 per cent to 74.2 per cent during the same period. This decline has been mainly due to thefall in growth rates of exports of textiles and gems and jewellery. In the case of India's exports to China,

the share of primary products has fallen from 65.7 per cent in 2009-10 to 38.4 per cent in 2012-13 (April-November) due to the fall in share and growth rate of ores & minerals.

TRADE POLICYRecent Trade policy measuresThe government has announced many trade policy measures in the Annual Supplement to Foreign TradePolicy (FTP) released on 5 June 2012. Many measures were also taken by the government in UnionBudget 2012-13 and the RBI in its monetary and credit policies during the course of the year to helpexports


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Policy for Promoting State-wise Exports7.37 The top five states in India's exports in 2011- 12 were Maharashtra, Gujarat, Tamil Nadu, AndhraPradesh, and Karnataka, accounting for 63.4 per cent of India's exports. While in 2011-12, these fivestates had high robust growth (except Gujarat with 5.5 per cent growth) in 2012-13 (April-November) all ofthem had negative growth. In fact all the other states in the top 15 except Odisha had positive growth in2012-13 (April-November) with Kerala, Rajasthan, and Punjab having high export growth in 2012-13 on

top of robust growth in 2011-12. Export growth of Haryana was also relatively high in 2012-13.

Special Economic Zones7.39 Since the Special Economic Zones (SEZ) Act and Rules were notified in February 2006, formalapprovals have been granted for setting up of 579 SEZs, of which 384 have been notified.

Some important trade policy measuresBudget relatedImports of equipment for initial setting up or substantial expansion of fertilizer projects fully exemptedfrom basic customs duty of 5 per cent for a period of three years up to 31 March 2015; and basic customsduty on some watersoluble fertilizers and liquid fertilizers other than urea reduced from 7.5 per cent to 5per cent and from 5 per cent to 2.5 per cent.

Concessional import duty available for installation of mechanized Handling Systems and PalletRacking Systems in mandis or warehouses extended for horticultural produce.

Full exemption from basic customs duty for coal-mining projects.

Basic customs duty on plant and machinery imported for setting up or substantial expansion of iron orepellet plants or iron ore beneficiation plants reduced from 7.5 per cent to 2.5 per cent.Full exemption from basic customs duty of 5 per cent for automatic shuttle-less looms and reduction inbasic customs duty on wool waste and wool tops from 15 per cent to 5 per cent.Basic customs duty increased on standard gold bars; gold coins of purity exceeding 99.5 per cent andplatinum from 2 per cent to 4 per cent and on non-standard gold from 5 per cent to 10 per cent.

Credit related In November 2011, the RBI increased the all-in cost ceilings for External Commercial Borrowings(ECBs) increased to 350 basis points (bps) over 6-months Libor/Euro Libor/Euribor for a maturity periodbetween three and five years and 500 bps over 6-months Libor/Euro Libor/Euribor for a maturity periodmore than five years. Accordingly the all-in cost ceiling on trade credits has also been increased to 350bps over 6-months Libor/Euro Libor/Euribor until 31 March 2013.

With effect from 5 May 2012, banks were allowed to determine their interest rates on export credit inforeign currency with the objective of increasing the availability of funds to exporters.On 18 June 2012, the RBI enhanced the eligible limit of the export credit refinance (ECR) facility forscheduled banks (excluding regional rural banks [RRB]) from 15 per cent of the outstanding export crediteligible for refinance to 50 per cent, with effect from 30 June 2012. The objective was to provideadditional liquidity support to banks of over Rs 300 billion. The rate of interest charged on the ECR facilitywas retained at the prevailing repo rate under the liquidity adjustment facility (LAF).The 2 per cent Interest Subvention Scheme, earlier meant only for handlooms, handicrafts, carpets,and SMEs, was extended on 1 April 2012 to 31 March 2013 for labour-intensive sectors also, viz. toys,sports goods, processed agricultural products, and readymade garments. This was further extended upto31 March 2014 and 134 tariff lines of engineering goods were also included in the scheme.


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Foreign Trade Policy Measures in 2012-13 Incentive on Incremental Exports: Incentives to be granted on incremental exports made during theperiod January- March 2013 over the base period January-March 2012. The incentive to be granted to anImporter and Exporter Code (IEC) holder at the rate of 2 per cent on incremental growth of exports madeto the USA, Europe, and Asian countries during this particular quarter, i.e. January-March 2013. Export Promotion Capital Goods (EPCG) Scheme: Zero Duty EPCG Scheme extended up to 31t

March 2013 and its scope enlarged. Export obligation under this scheme to be 25 per cent of the normalexport obligation for export of products from north-eastern states and export of specified products throughnotified Land Customs Stations of the north-eastern region provided additional incentive to the extent of 1per cent of Free on Board (FOB) value of exports.

Support for Export of Green Technology Products: To promote exports of 16 identified greentechnology products, export obligation for manufacturing of these products under the EPCG Schemereduced to 75 per cent of the normal export obligation.

Support for Infrastructure for the Agriculture Sector: Status holders exporting products under ITC (HS)Chapter 1 to Chapter 23 (both inclusive) are getting Duty Credit Scrip equivalent to 10 per cent of FOBvalue of agricultural products so exported. Import of 14 specified equipments have now been notified in

Appendix 37 F for setting up of pack- houses besides import of capital goods and equipment for cold

storage units, pack-houses, etc.

Incentives for Promoting Investment in Labour-intensive Sectors: Status holders issued status holdersincentive scrip (SHIS) to import capital goods for promoting investment in upgradation of technology ofsome specified labourintensive sectors like leather, textile & jute, handicrafts, engineering, plastics andbasic chemicals. Up to 10 per cent of the value of these scrips will be allowed to be utilized to importcomponents and spares of capital goods imported earlier. Market and Product Diversification: Seven newmarkets have been added to the Focus Market Scheme (FMS) and seven to the Special Focus MarketScheme (Special FMS). Forty-six new items have been added to the Market Linked Focus ProductScheme (MLFPS). The MLFPS has been extended till 31 March 2013 for exports to the USA and EU inrespect of items falling under Chapter 61 and Chapter 62. Around 100 new items have been added to theFocus Product Scheme (FPS) list. Three new items have been added to the Vishesh Krishi and GramUdyog Yojana (VKGUY). Additional measures announced as trade facilitation measures by widening and

deepening of export incentives under chapter 3 of FTP in December, 2012 to be made effective from01.01.2013. These include addition of 5 new markets to FMS, one new market to Special FMS, 62 newitems to MLFPS and 102 new items to FPS.

Simplification of Procedures: Import under advance authorization (AA) permitted at any of theElectronic Data Interchange (EDI) ports, irrespective of the EDI port in which the AA has been registered.There would be no requirement of Telegraphic Release Advice (TRA). Export shipments from Delhi andMumbai through post, courier, or e-Commerce to be entitled for export benefits under the FTP.

New 'e-BRC' Initiative: A major EDI initiative the 'e-BRC' launched which would herald electronictransmission of foreign exchange realization from the respective banks to the Directorate General ofForeign Trade (DGFT) server on a daily basis. The exporter will not be required to make any request tothe bank for issuance of a bank export and realization certificate (BRC).

WTO NEGOTIATIONS AND INDIA7.43 The Doha Round of trade negotiations in the WTO which began in 2001 remains unfinished due todifferences among members on various issues. The Eighth Ministerial Meeting of the WTO which washeld in December 2011 in Geneva provided political guidance to the members to resolve the issuesinvolved. However, there was no significant progress in 2012. Efforts are being made for an early harveston some issues in time for the Ninth Ministerial Conference of the WTO (MC9) to be held in December


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6. Global System of Trade Preferences (GSTP): The Agreement establishing the GSTP amongdeveloping countries was signed on 13 April 1988 at Belgrade following the conclusion of the First Roundof Negotiations. Forty-three countries have ratified the Agreement and become participants. India hasoffered tariff concessions on 70.08 per cent of dutiable tariff lines with an across-the-board margin ofpreference (MoP) of 20 per cent on the applied tariffs prevailing on the date of import. India has also

unilaterally offered special concessions to LDC participants by granting an MoP of 25 per cent on 77 percent of all its dutiable tariff lines. The Cabinet Committee on Economic Affairs (CCEA), in its meeting on23 August 2012, has granted approval for implementing India's schedule of concessions. The tariffconcessions are to be implemented thirty days after a minimum of four participants ratify their schedulesof concessions. So far India and Malaysia have ratified their schedules.

Reviving and Accelerating India's Trade: Micro, Sector- and Port-specific issuesSome trade-related issues and suggested policies at the micro, sector-specific and port-specific levels areas follows:

Infrastructure Related:Port Infrastructure issues include poor road conditions and port connectivity,congestions, vessel berthing delays, poor cargo handling techniques and equipment., resulting in multiplehandlings, increased lead time, high transaction costs and thus loss of market competitiveness.

Trade Facilitation Measures: These include simplification of the multiple documentation proceduresabolishing the system of printing and certifying export promotion(EP) copies of shipping bills,implementing 24x7 system for Container Freight Stations (CFSs) , reducing unnecessary paper workrelated to renewal of letters of undertaking (LUT) for export without payment of duty, discouraging thepractice of insistence by banks for L/Cs through their branches in foreign countries, merging orstreamlining the Market Access Initiative (MAI) & Marketing Development Assistance (MDA) schemes,removing the annual average export performance condition under the EPCG scheme, and addressing theissue of trade litigations.


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8. 8. Agriculture and Food Management

CROP PRODUCTION8.7 During the Eleventh Plan period, foodgrains production in the country recorded an increasing trend,except in 2009-10 when total foodgrains production declined to 218.1 million tonnes due to severedrought experienced in various parts of the country. During 2011-12, total foodgrains production reachedan all-time high of 259.32 million tonnes. However, the production of 2012-13 kharif crops (Table 8.3) islikely to be adversely affected by deficiency in the south-west monsoon and the resultant acreage losses

Policy Initiatives for FertilizersThe government has notified the New Investment Policy 2012 (NIP-2012) in the urea sector which willencourage investments leading to increase in indigenous capacities, reduction in import dependence andsavings in subsidy due to import substitution at prices below import parity price (IPP).

Under the Nutrient Based Subsidy (NBS) scheme for phosphatic and potassic (P&K) fertilizersimplemented in 2010, a fixed amount of subsidy, decided on annual basis, is provided to each grade ofP&K fertilizer, depending upon its nutrient content.

Irrigation8.16 India has made considerable progress in developing irrigation infrastructure. However irrigation

efficiency is low for both surface and ground waters. In order to help the rainfed farmers improveproductivity and profitability, in situ soil and water conservation practices are developed for different agro-climatic regions with special emphasis on effective rainwater management along with a suite of location-specific technologies. Substantial irrigation potential has been created through major and mediumirrigation schemes.


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MAJOR SCHEMES / PROGRAMMES FOR THE AGRICULTURAL SECTOR8.21 Agriculture being a state subject, primary responsibility for increasing agriculture production,enhancing productivity and exploring the untapped potential of the sector rests with the states. Thecentral government supplements the efforts of state governments through centrally sponsored andcentral-sector schemes.

National Food Security MissionTo enhance the production of rice, wheat, and pulses by 10, 8, and 2 million tonnes respectively by theend of the Eleventh Plan through area expansion and productivity enhancement; restoring soil fertility andproductivity; creating employment opportunities; and enhancing farm-level economy to restore theconfidence of farmers of targeted districts

Rashtriya Krishi Vikas YojanaThe Rashtriya Krishi Vikas Yojana (RKVY) was launched in 2007-8 with an outlay of ` 25,000 crore in theEleventh Plan for incentivizing states to enhance public investment.

National Mission for Sustainable AgricultureClimate change poses a major challenge to agricultural production and productivity. The National Mission

for Sustainable Agriculture (NMSA), under the aegis of the National Action Plan on Climate Change(NAPCC), seeks to address issues related to 'Sustainable Agriculture' in the context of risks associatedwith climate change. It hopes to achieve its objectives by devising appropriate adaptation and mitigationstrategies for ensuring food security, enhancing livelihood opportunities, and contributing to economicstability at national level. The NMSA has already been accorded 'in-principle' approval by Prime Minister'sCouncil on Climate Change . During the Twelfth Five year Plan, climate change adaptation and mitigationstrategies will be operationalized by restructuring the existing programmes.

Bringing Green Revolution to Eastern India8.25 Bringing Green Revolution to Eastern India, initiated in 2010-11, intends to address the constraintslimiting the productivity of 'rice based cropping systems' in eastern India comprising seven states, viz.

Assam, Bihar, Chhattisgarh, Jharkhand, Odisha, Eastern Uttar Pradesh, and West Bengal.

Macro Management of Agriculture8.27 The Macro Management of Agriculture (MMA) scheme, revised in 2008, has formula-basedallocation criteria and provides assistance to states/ UTs as 100 per cent grant.

The National Food Security Bill8.54 In order to address the issue of food security in a comprehensive manner, the Governmentintroduced National Food Security Bill in the Lok Sabha on 22 December, 2011. The Bill, inter alia,envisages coverage of 75% of the rural and 50% of the urban population for subsidised foodgrains underthe Targeted Public Distribution System, besides provisions for nutritional support to women and children.

After its introduction, the Bill was referred to the Parliamentary Standing Committee on Food, ConsumerAffairs and Public Distribution for examination.


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9. IndustryGovernment's key initiatives to Boost Manufacturing

Apart from the government's recent steps to uplift overall business sentiment and boost investment,several specific initiatives have been initiated to strengthen industry and in particular the manufacturingsector in the country. The Twelfth Five Year Plan document lays down broad strategies for spurring

industrial growth and recommends sector specific measures covering micro, small, medium and largeindustries in the formal as well as informal sector. Some of major initiatives that can change themanufacturing landscape of the country are announcement of National Manufacturing Policy (NMP),implementation of the Delhi Mumbai Industrial Corridor (DMIC) Project (see Chapter 2) and policy reformsto promote foreign direct investment (FDI) and an e-Biz project.

National Manufacturing Policy (NMP)The NMP was approved by the government in October, 2011. The major objectives of the policy areenhancing the share of manufacturing in gross domestic product (GDP) to 25 per cent and creating anadditional 100 million additional jobs over a decade or so. The Policy also provides special focus toindustries that are employment intensive, those producing capital goods, those having strategicsignificance, small and medium enterprises, and public sector enterprises besides industries where Indiaenjoys a competitive advantage. The NMP provides for promotion of clusters and aggregation, especiallythrough the creation of national investment and manufacturing zones (NIMZs). Out of twelve NIMZs so farannounced, eight are along the DMIC. Besides, four other NIMZs have been given in-principle approval(i) Nagpur in Maharashtra, (ii) Tumkur in Karnataka, (iii) Chittoor district in Andhra Pradesh, and (iv)Medak district in Andhra Pradesh.

DMIC ProjectIndustrial development initiatives under DMIC project presently cover eight industrial cities that areproposed to be developed along the railway corridor. The Master Planning for the investment regions andindustrial areas taken up initially to be developed as new cities in Gujarat, Madhya Pradesh, Haryana,Rajasthan and Maharashtra have been completed and master planning in Uttar Pradesh has started. TheState governments have initiated the process of obtaining land for the new industrial regions/areas aswell as for the Early Bird Projects. Environmental impact assessment (EIA) studies have been initiated for

five industrial cities. Details of the overall DMIC project have been discussed in Chapter 2.

FDI Policy initiativesAs a part of policy reform process, the FDI policy is being progressively liberalized on an ongoing basis inorder to allow FDI in more industries under the automatic route. Some recent changes in FDI policy,besides consolidation of the policy into a single document include FDI in multi-brand retail trading up to51 per cent subject to specified conditions; increasing FDI limit to 100 per cent in single-brand retailtrading; FDI up to 49 percent in civil aviation and power exchanges; FDI up to 49 percent in broadcastingsector under the automatic route and FDI above 49 percent and up to 74 percent under the Governmentroute both for teleports and mobile TV.

Setting up of the e-Biz Project to promote ease of doing businessThe government has announced the setting up of -'Invest India'-, a joint-venture company between the

Department of Industrial Policy and Promotion and FICCI, as a not-for-profit, single window facilitator, forprospective overseas investors and to act as a structured mechanism to attract investment. In addition,the Government has initiated implementation of the e-Biz Project, a mission mode project under theNational e-Governance Plan (NeGP) for promoting an online single window at the national level forbusiness users. The objectives of setting up of the e-Biz portal are to provide a number of services tobusiness users, covering the entire life cycle of their operation. The project aims at enhancing India'sbusiness competitiveness through a service oriented, event-driven G2B interaction.


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10. Services SectorFDI in Multibrand Retail TradingFDI in multibrand retail trading has been permitted subject to specified conditions like the following:

Fresh agricultural produce, including fruits, vegetables, flowers, grains, pulses, fresh poultry,fishery, and meat products, may be unbranded; Minimum amount to be brought in as FDI by the

foreign investor, would be US $ 100 million; At least 50 per cent of total FDI brought in shall be invested in backend infrastructure within

three years of the first tranche of FDI; At least 30 per cent of the value of procurement of manufactured/ processed products purchased

shall be sourced from Indian small industries which have a total investment in plant andmachinery not exceeding US $ 1million;

Retail sales outlets may be set up only in cities with a population of more than 10 lakh as perCensus 2011and may also cover an area of 10 km around the municipal/urban agglomerationlimits of such cities;

Government will have the first right to procurement of agricultural products.State governments/UTs would be free to take their own decisions in regard to implementation ofthe policy as retail trade is a state subject. Eleven states/UTs, viz. Andhra Pradesh, Assam,Delhi, Haryana, Jammu and Kashmir, Maharashtra, Manipur, Rajasthan, Uttarakhand, Daman

and Diu, and Dadra and Nagar Haveli have agreed to permit establishment of retail outlets underthis policy.

FDI in multibrand retail trade would benefit stakeholders across the entire span of the supply chain.Farmers stand to benefit from the significant reduction in post-harvest losses expected to result from thestrengthening of the backend infrastructure, which would enable the farmers to obtain a remunerativeprice for their produce. Small manufacturers will benefit from the conditionality requiring at least 30 percent procurement from Indian small industries, as this would enable them to get integrated with globalretail chains. This in turn will enhance their capacity to export products from India. As far as small retailersare concerned, organized retail already coexists with small traders and the unorganized retail sector.Studies indicate that there has been a strong competitive response from the traditional retailers to theseorganized retailers, through improved business practices and technological upgradation. Globalexperience also indicates that organized and unorganized retail coexist and grow.

Consumers stand to gain the most, first, from the lowering of prices that would result from supply-chainefficiencies and secondly, through improvement in product quality due to the combined effect oftechnological upgradation, efficient grading, sorting and packaging, testing and quality control, andproduct standardization


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11.Energy, Infrastructure and Communications

Dedicated Freight Corridor ProjectThe Eastern and Western Dedicated Freight Corridors (DFC) are a mega rail transport project beingundertaken to increase transportation capacity, reduce unit costs of transportation, and improve service

quality. The Eastern DFC (1839 route kilometres [RKM]) extends from Dankuni near Kolkata to Ludhianain Punjab, while the Western DFC (1499 RKM) extends from the Jawahar Lal Nehru Port (JNPT) inMumbai to Dadri /Rewari near Delhi. A special purpose vehicle, the Dedicated Freight CorridorCorporation of India Limited has been set up to implement the project.

Apart from the Eastern and Western DFCs, a feasibility study has also been undertaken on four future freight

corridors, viz. East-West Corridor (Kolkata-Mumbai), North-South Corridor (Delhi-Chennai), East Coast

Corridor (Kharagpur- Vijayawada) and Southern Corridor (Goa-Chennai). A pre-feasibility study of the

Chennai-Bangalore Freight Corridor is also being proposed. After commissioning of the Eastern and Western

DFCs, it is planned to upgrade the speed of passenger trains to 160-200 kmph on the existing routes.

NTP-2012

The Government approved National Telecom Policy (NTP) 2012, which addresses the vision, strategicdirection, and the various medium- and long-term issues related to the telecom sector, on 31 May 2012. NTP-

2012 is aimed at maximizing public good by making affordable, reliable, and secure telecommunication and

broadband services available across the country. The objectives of NTP-2012 include the following:

Provide secure, affordable, and high-quality telecommunication services to all citizens.

Strive to create One Nation-One Licence across services and service areas.

Achieve One Nation-Full Mobile Number Portability and work towards One Nation-Free

Roaming.

Increase rural tele-density from the current level of around 39 to 70 by the year 2017 and 100 by

the year 2020.

Recognize telecom, including broadband connectivity, as a basic necessity like education and

health and work towards 'Right to Broadband'. Provide affordable and reliable broadband-on-demand by the year 2015 and to achieve 175

million broadband connections by the year 2017 and 600 million by the year 2020 at minimum 2

Mbps download speed and make available higher speeds of at least 100 Mbps on demand.

Provide high-speed and high-quality broadband access to all village panchayats through a

combination of technologies by the year 2014 and progressively to all villages and habitations by

2020.

Recognize telecom as an infrastructure sector to realize the true potential of information

communication technology (ICT) for development

Address right-of-way (RoW) issues in setting up of telecom infrastructure.

Mandate an ecosystem for ensuring setting up of a common platform for interconnection of

various networks for providing non-exclusive and non-discriminatory access.

Strive for enhanced and continued adoption of green policy in telecom and incentivize use of

renewable resources for sustainability

Achieve substantial transition to the new Internet Protocol (IPv 6) in the country in a phased and

time-bound manner by 2020 and encourage an ecosystem for provision of a significantly large

bouquet of services on the IP platform.


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12. Sustainable Development and Climate ChangeThe year 2012 may arguably be considered a high water mark in the field of environment and sustainable

development initiatives. The global community met at the UN Conference on Sustainable Development

that took place in Rio in June 2012, also marking the 20th anniversary of the landmark first Earth Summit

held in 1992. The Conference reviewed the progress made, identified implementation gaps, and assessed

new and emerging challenges, which resulted in a political outcome called the 'The Future We Want'.India is committed to sustainable development with equal emphasis on its three dimensions - social,

economic, and environmental.

Twelfth Five Year Plan Approaches for Sustainable Development and LowerCarbon StrategiesThe Twelfth Plan strategy suggests that there are significant 'co-benefits' for climate action withinclusive and sustainable growth. India as a large responsible player with very low income has alsoto ensure that these efforts are matched by equitable and fair burden sharing among countries,taking into account the historical responsibilities for emissions.

An Expert Group on Low Carbon Strategies appointed by the Planning Commission has outlined the

lower carbon strategies for major potential carbon mitigation sectors:(i) Power : On the supply side, adopt super-critical technologies in coal-based thermal power

plants; use gas in combined heat and power systems; invest in renewable technologies;and develop hydropower in a sustainable manner. On the demand side, accelerateadoption of super-efficient electrical appliances through market and regulatorymechanisms; enhance efficiency of agricultural pump sets and industrial equipment withbetter technology; modernize transmission and distribution to bring technical andcommercial losses down to world average levels; universalize access to electricity; andaccelerate power-sector reforms.

(ii) Transport : Increase the share of rail in overall freight transport; improve the efficiency of railfreight transport; make it price competitive by bringing down the levels of cross-subsidization between freight and passenger transport; complete dedicated rail corridor;improve share and efficiency of public transport system; and improve fuel efficiency ofvehicles through both market-based and regulatory mechanisms.

(iii) Industry : Greenfield plants in the iron and steel and cement sectors adopt best availabletechnology; existing plants, particularly small and medium ones, modernize and adoptgreen technology at an accelerated pace, with transparent financing mechanisms.

(iv)Buildings : Evolve and institutionalize green building codes at all levels of government.(v) Forestry : 'Green India Mission' to regenerate at least 4 million ha of degraded forest;

increase density of forest cover on 2 million ha of moderately dense forest; and overallincrease the density of forest and tree cover on 10 million ha of forest, waste, andcommunity lands.

Rio + 2012.14 The United Nations Conference on Sustainable Development (UNCSD), was held in June 2012 atRio de Janeiro, Brazil, (also known as Rio+20) and was attended at the heads of states level.

12.15 The objective of the Rio+20 Conference was to secure renewed political commitment forsustainable development, review progress made and identify implementation gaps, and assess new andemerging challenges since the UNCSD held 20 years ago in Rio de Janeiro in 1992. Towards this end,the Conference had two themes, viz.(a) green economy in the context of sustainable development & poverty eradication; and(b) institutional framework for sustainable development.


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The most significant outcomes of the Rio Summit have been the restoration of the principles of equity andof common but differentiated responsibilities (CBDR) in the global environmental discourse and placingpoverty eradication at the centre of the global development agenda. The outcome also ensures therequired domestic policy space to countries on a green economy and launched four processes/mechanisms, i.e. developing SDGs, financing strategy, technology transfer, and defining the format andorganizational aspects of the proposed highlevel political forum to follow up on the implementation ofsustainable development.

On the issue of Green economy, the outcome document affirms that there are different approaches,visions, models, and tools available to each country, in accordance with its national circumstances andpriorities, for achieving sustainable development. It identifies green economy in the context of sustainabledevelopment and poverty eradication as one of the important tools for achieving sustainable developmentbut specifies that while it could provide options for policy-making it should not be a rigid set of rules.

Convention on Biological Diversity12.22 Global concerns about biodiversity found expression in the CBD adopted in 1992. The objectives ofthe Convention are: conservation of biodiversity, sustainable use of its components, and the fair andequitable sharing of benefits arising from the use of genetic resources.

Doha Climate Change Conference 201212.25 The 18th session of the COP to the UNFCCC, that started on 26 November and concluded on 8December 2012 in Doha, Qatar has resulted in a set of decisions (clubbed together as 'Doha ClimateGateway.

The key issues for the Doha conference were: Amending the KP to implement the second commitment period under the Protocol; Successfully concluding the work of the Bali Action Plan (BAP) within which there was urgent

need for a Clear path to climate finance; planning the work under the Durban Platform (DP) for enhanced action.

The Conference addressed all three issues and came out with a package which balanced the interestsand obligations of various countries.

At the Doha Conference, the three issues of equity, technology-related IPRs, and unilateral measuresraised by India resounded in the decisions. These outstanding or unresolved issues under the BAP arenow part of the planned or continuing work of various bodies of the Convention.

FINANCING CLIMATE CHANGEA UNFCCC paper (2007) estimated a requirement of US$ 200-210 billion in additional annual investmentin 2030 to return GHG emissions to current levels. Further, additional investment needed worldwide foradaptation was estimated to be annually US$ 60-182 billion in 2030. However, with the passage of timeand inadequate action, these estimates are being revised upwards. Most recent estimates presented atthe UNFCCC's workshop on Long-term Finance (July 2012) point to an even more enormous scale offunds, in the range of $600-$1500 billion a year, that would be needed by developing countries formitigation and adaptation.


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3. Public financeThe Budget for 2012-13 introduced amendments to the FRBM Act as part of the Finance Bill. Theseamendments contained two important features of expenditure reforms. First is the introduction of theconcept of effective revenue deficit, which excludes from the conventional revenue deficit, grants for thecreation of capital assets. This is an important development for the reason that while the revenue deficitof the consolidated general government fully reflects total capital expenditure incurred, in the accounts ofthe centre, these transfers are shown as revenue expenditure. Therefore the mandate of eliminating theconventional revenue deficit of the centre becomes problematic. With this amendment, the endeavour ofthe government under the FRBM Act would be to eliminate the effective revenue deficit. Similarly, at statelevel also, some of the capital transfers to local bodies or parastatals could get reflected as revenueexpenditure. By understating capital expenditure, this might lead to a divergence between the nationalaccounts data on capital formation on the government accounts and the conventional public finance datathat is gleaned from the Budgets.

The second important feature is the introduction of the provision for 'Medium Term ExpenditureFramework Statement in the FRBM Act. This medium-term framework provides for rolling targets forexpenditure, imparting greater certainty, and encourages prioritization of expenditure. Together with themeasures proposed to raise the tax-GDP ratio, the expenditure reforms are expected to yield better fiscalmarksmanship, thereby mitigating key fiscal risks.

DIRECT TAXESThe income slab for 20 per cent tax rate has been broadened for all individual taxpayers irrespective oftheir age and will now be applicable to total income between ` 5 lakh and ` 10 lakh instead of the earlierslab of ` 5 lakh and ` 8 lakh. The tax rate of 30 per cent will now be applicable to total income exceeding10 lakh. Securities transaction tax on certain transactions in specified securities has been reduced fromthe existing 0.125 per cent to 0.1 per cent.

The two specific measures aimed at expanding the direct tax base in the Budget for 2012-13 were theintroduction of the provisions of GAAR in the Income Tax Act and extending the provisions of alternateminimum tax (AMT) to all non-company assessees. In an environment of moderate rates of tax, it isnecessary that the correct tax base be subject to tax in the face of aggressive tax planning and use of

opaque low tax jurisdictions for residence as well as for sourcing capital.


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13 Human DevelopmentAs per the latest available Human Development Report (HDR) 2011 published by the United NationsDevelopment Programme (UNDP) (which estimates the human development index [HDI] in terms of threebasic capabilities: to live a long and healthy life, to be educated and knowledgeable, and to enjoy adecent economic standard of living), the HDI for India was 0.547 in 2011 with an overall global ranking of

134 (out of 187 countries) compared to 119 (out of 169 countries) in HDR 2010.

India is ranked 129 in terms of the gender inequality index(GII) which captures the loss in achievementdue to gender disparities in the areas of reproductive health, empowerment, and labour forceparticipation, with values ranging from 0 (perfect equality) to 1 (total inequality). A lot more needs to bedone as our GII is higher than the global average of 0.492. Even neighbours like Pakistan (115),Bangladesh (112), and Sri Lanka (74)

INCLUSIVE DEVELOPMENTInclusive development includes social inclusion along with financial inclusion and in most cases thesocially excluded are also financially excluded.

POVERTY

13.10 The Planning Commission estimates poverty using data from the large sample surveys onhousehold consumer expenditure carried out by the National Sample Survey Office (NSSO) every fiveyears. It defines poverty line on the basis of monthly per capita consumption expenditure (MPCE). It hasestimated the poverty lines at all India level as an MPCE of ` 673 for rural areas and ` 860 for urban areasin 2009-10. Based on these cut-offs, the percentage of people living below the poverty line in the countryhas declined from 37.2 per cent in 2004-5 to 29.8 per cent in 2009-10.

Infant mortality rate (IMR) which was 58 per thousand in the year 2005 has fallen to 44 in the year 2011.The number of rural households provided toilet facilities annually have increased from 6.21 lakh in 2002-3to 88 lakh in 2011-12.

INEQUALITY13.12 HDR measures inequality in terms of two indicators. The first indicator is the income Gini coefficient

which measures the deviation of distribution of income (or consumption) among the individuals within acountry from a perfectly equal distribution. For India, the income Gini coefficient was 36.8 in 2010-11.

EMPLOYMENT Labour force participation rate, which reflects the persons who express theirwillingness to work declined from 430 per thousand persons in 2004-5 to 400 per thousand persons in

2009-10.

POVERTY ALLEVIATION AND EMPLOYMENT GENERATION PROGRAMMES

Mahatma Gandhi NREGA: This flagship programme of the government aims at enhancing livelihood

security of households in rural areas by providing at least one hundred days of guaranteed wageemployment in a financial year to every household whose adult members volunteer to do unskilledmanual work with the stipulation of one-third participation of women. The MGNREGA provides wageemployment while also focusing on strengthening natural resource management through works thataddress causes of chronic poverty like drought, deforestation, and soil erosion and thus encouragesustainable development


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Socio Economic and Caste Census

National Rural Livelihood Mission (NRLM)- Aajeevika:The Swarnjayanti Gram Swarozgar Yojana (SGSY)/ NRLM a self-employment programme implementedsince April 1999 aims at lifting the assisted rural poor families (swarozgaris) above the poverty line by

providing them income-generating assets through a mix of bank credit and government subsidy. The ruralpoor are organized into self-help groups (SHGs) and their capacities built through training and skilldevelopment. The SGSY now restructured as the NRLM has been renamed Aajeevika and implementedin mission mode across the country since 2011. The main features of Aajeevika are: a) one womanmember from each identified rural poor household to be brought under the SHG network, b) ensuring 50per cent of the beneficiaries from SC/STs, 15 per cent from minorities, and 3 per cent persons withdisability while keeping in view the ultimate target of 100 per cent coverage of BPL families, c) training forcapacity building and skill development, d) ensuring revolving fund and capital subsidy, e) financialinclusion, f) provision of interest subsidy, g) backward and forward linkages, and h) promotinginnovations.

SOCIAL PROTECTION PROGRAMMES

Aam Admi Bima Yojana (AABY): The Janashree Bima Yojana (JBY) has now been merged with theAABY to provide better administration of life insurance cover to the economically backward sections ofsociety. The scheme extends life and disability cover to persons between the ages of 18 and 59 yearsliving below and marginally above the poverty line under 47 identified vocational/occupational groups,including 'rural landless households'.

Rashtriya Swasthya Bima Yojana (RSBY): The scheme provides smart card-based cashless healthinsurance cover of ` 30,000 per family per annum on a family floater basis to BPL families in theunorganized sector with the premium shared on 75:25 basis by central and state governments.

The Unorganized Workers Social Security Act 2008 and National Social Security Fund: The Act providesfor constitution of a National Social Security Board and State Social Security Boards which will

recommend social security schemes for unorganized workers. The National Social Security Board wasconstituted in August 2009

RURAL INFRASTRUCTURE AND DEVELOPMENT

Bharat Nirman:Bharat Nirman, launched in 2005-6 by the government to provide basic amenities andinfrastructure to rural India has six components: irrigation, roads, housing, water supply, electrification,and telecommunication connectivity.

Indira Awas Yojana (IAY): The unit assistance provided to rural households for construction of adwelling unit under the IAY is being revised w.e.f. I April 2013 from ` 45,000 to ` 70,000 in plain areas andfrom ` 48,500 to ` 75,000 in hilly/ difficult areas/Integrated Action Plan (IAP) districts. For effectivemonitoring of the IAY, MIS software 'Awaasoft' has been put in place.

Pradhan Mantri Gram Sadak Yoyana (PMGSY):The PMGSY was launched in December 2000 as afully funded centrally sponsored scheme with the objective of providing connectivity to the eligibleunconnected habitations in the core network with a population of 500 persons and above (as per Census2001) in plains areas and 250 persons and above in hill states, tribal areas, desert areas, and in the 82selected tribal and backward districts under the IAP.


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Rural Drinking Water:About 73.91 per cent of rural habitations are fully covered under the provision ofsafe drinking water in rural areas as measured by habitations with the provision of at least 40 litres percapita per day (lpcd) of safe drinking water.

Rural Sanitation

Total Sanitation Campaign (TSC):According to Census 2011, only 32.7 per cent of rural households have latrine facilities. The TSCrenamed the Nirmal Bharat Abhiyan (NBA) aims to transform rural India into 'Nirmal Bharat' by adopting acommunity saturation approach and achieve 100 per cent access to sanitation for all rural households by2022.

SKILL DEVELOPMENT13.27 Education and skill development play a pivotal role in economic development and growth of anycountry as they provide an environment for creating jobs and help in reduction of poverty and otherrelated social fallouts. National Skill Development Corporation (NSDC) approved 24 training projects forimparting skill training in a wide array of sectors like healthcare, tourism, hospitality and travel, banking,financial services and insurance (BFSI), retail, IT, electronics, textiles, leather, handicrafts andautomotive, agriculture, cold chains and refrigeration, tailoring, carpentry, and masonry. Besides

formation of Skill Councils for seven sectors, proposals related to food processing, telecom, agriculture,plumbing, logistics, capital goods, and construction sectors have also been approved during this period.

HEALTH13.34 Improvement in the standard of living and health status of the population has remained one of theimportant objectives for policymakers in India. In line with the National Health Policy 2002, the NRHM waslaunched on 12 April 2005 with the objective of providing accessible, affordable, and quality healthcare tothe rural population. It seeks to bring about architectural correction in the health systems by adopting theapproaches like increasing involvement of community in planning and management of healthcarefacilities, improved programme management, flexible financing and provision of untied grants,decentralized planning and augmentation of human resources.


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National Rural Health Mission (NRHM): The NRHM which provides an overarching umbrella to theexisting health and family welfare programmes was launched in 2005 to improve accessibility to qualityhealthcare for the rural population, bridge gaps in healthcare, facilitate decentralized planning in thehealth sector, and bring about inter-sectoral convergence. Better infrastructure, availability of manpower,drugs and equipment, and augmentation of health human resources in health facilities at different levelshave led to improvement in healthcare delivery services and increase in outpatient department (OPD) andinpatient department (IPD) services.

Janani Suraksha Yojana (JSY):The JSY launched in 2005 aims to bring down the MMR by promoting

institutional deliveries conducted by skilled birth attendants. Janani Shishu Suraksha Karyakram

(JSSK),a new initiative which entitles all pregnant women delivering in public health institutions to an

absolutely no expenses delivery covering free delivery including Caesarean, free drugs, diagnostics,

blood and diet, and free transport from home to institution including during referrals, is also in operation.

National Vector Borne Disease Control Programme: To control and prevent vector-borne diseases

such as malaria, dengue, chikungunya, Japanese encephalitis, kala-azar, and lymphatic filariasis. Of

these six diseases, kala-azar and lymphatic filariasis have been targeted for elimination by 2015.

Pradhan Mantri Swasthya Suraksha Yojana (PMSSY): The PMSSY aims at correcting regional

imbalances in the availability of affordable/reliable tertiary health-care services and augmenting facilitiesfor quality medical education in the country.which aims at (i) construction of 6 AIIMS-like institutions in the first phase at Bhopal, Bhubaneswar,Jodhpur, Patna, Raipur, and Rishikesh and in the second phase in West Bengal and Uttar Pradesh,(ii) upgradation of 13 medical colleges

WOMEN AND CHILD DEVELOPMENT

Integrated Child Development Services (ICDS) Scheme: The objective of the ICDS scheme is holisticdevelopment of children below 6 years of age and proper nutrition and health education of pregnant andlactating mothers This has now been universalized.

Rajiv Gandhi Scheme for Empowerment of Adolescent Girls (RGSEAG)-Sabla: Sabla now operational in205 selected districts aims at all-round development of adolescent girls in the age group 11- 18 years andmaking them self-reliant with a special focus on out-of-school girls. The scheme has two majorcomponents, nutrition and non-nutrition. Nutrition is being given in the form of 'take home rations' or 'hotcooked meals' to out-of -school 11-14 year old girls and all adolescent girls in the 14 -18 age group. Thenon-nutrition component addresses the developmental needs of 11-18 year old adolescent girls who areprovided iron-folic acid supplementation, health check-up and referral services, nutrition and healtheducation, counseling/ guidance on family welfare, skill education, guidance on accessing public services,and vocational training.

Indira Gandhi Matritva Sahyog Yojana (IGMSY): The IGMSY is a conditional cash transfer scheme forpregnant and lactating women.

National Mission for Empowerment of Women (NMEW): This initiative for holistic empowerment of women

through better convergence and engendering of policies, programmes, and schemes of different

ministries was operationalized in 2010-11.

Rashtriya Mahila Kosh (RMK): The RMK provides micro-credit in a quasi-informal manner, lending tointermediate micro-credit organizations (IMOs) across states. It focuses on poor women and theirempowerment through the provision of credit for livelihood-related activities.


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Policies to address violence against women:Addressing violence against women is another area which has received a lot of recent attention. Anordinance has also been issued on sexual assault against women [Criminal Law (Amendment)Ordinance, 2013] based on the recommendations of the Justice Verma Committee. New initiatives arebeing taken like one-stop crisis centres for providing shelter, police assistance, legal, medical andcounselling services with public hospitals as focal point. A scheme for providing restorative justicethrough financial assistance and support services to victims of rape will be implemented in the TwelfthPlan as per the directives of the Supreme Court of India.

NOTE: READ CHAPTER 1 FULL AND IN CHAPTER 3 I DIDT FOUND MUCHINTERESTED U GO THROUGH AND LET ME KNOW IF ANY IMPORTANT.

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