gauri_eco_project.odt

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WTO AND FOOD SECURITY IN INDIA

A PROJECT

SUBMITED AS A PARTIAL REQUIREMENT FOR M.COM-1 DEGREE

BY

GAURI R. DOKE

UNDER THE GUIDENCE OF

DR.MADHUBALA SWAMI

ASSOCIATE PROFESSOR AND HEAD OF THE ECONOMICS DEPARTMENT

RAMANAND ARYA D.A.V.COLLEGE

BANDUP (E).

MUMBAI-400042.

September 16, 2013.


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Title of the Project :

Name of Candidate : GAURI R. DOKE

Name and Designation of the Guide : Dr. Madhubala Swami

Associate Professor and Head,

Economics Department

Place of Research : Ramanand Arya D.A.V.College

Bhandup (E)

Mumbai-400042.

Date of Submission : 25/09/2013

Signature of Student :

Signature of Guide :


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INTRODUCTION

One of the major objectives of formation of SAARC forum was to accelerate the process

of economic and social development in member States. Subsequently, trade promotion was

also actively pursued as an area of economic co-operation. The possibility of Intra- SAARC

trade expansion has been investigated using macroeconomic and regional trade link models.

It is generally found that inter-country differences in production and consumption patterns,

investment behaviour, tax and non-tax structures leave considerable scope for further regional

trade expansion. At present, intra-SAARC trade is quite low as compared with that of

regional forums such as European Union (EU) and Association of South East Asian Nations

(ASEAN).

In order to examine what has happened to the overall SAARC trade, intra-SAARC

trade and product group wise comparative advantage in trade of individual member countries,

this paper attempts an intertemporal analysis particularly for the post-SAARC formation

period. In today's world no nation exists 10 economic isolation. A nation's economy, its

industries, service sectors, levels of income and employment and living standards are linked

to the economies of its trading partners. The benefits of international trade accrue in the

forms of lower domestic prices, development of more efficient methods and new products

and a greater range of consumption choices. In an open trading system, a country will import

those commodities that it produces relatively at a higher cost. Since resources are channeled

from uses of low productivity to that of high productivity, gains from trade are attained

permitting higher levels of consumption and investment.

Over the past 20 years, world trade has grown twice as fast as real GDP

deepening economic integration and raising living standards1 . The role of foreign

trade in economic development is considerable and both are intimately connected.


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Trade can stimulate growth if exports are tending to increase faster than imports or be a brake

on growth if imports are tending to increase faster than exports.

The dramatic growth of cross-border investment and international trade over the past

two decades combined with explosive growth in global communications and technology. The

FDI4 flow, which was $160 billion in 1991 soared to $1.1 trillion in 2000. And the volume of

international trade also expanded dramatically to 16 fold over the past 50 years, are an

evident for well being of the nations through open trading system. However, it is generally

accepted that the gains to a nation from free international trade may more than outweigh the

losses to particular domestic firms and workers. Although free trade is often strongly

advocated, many countries believe that the expansion in trade is best accomplished through

the establishment of Regional Economic Association (REA) / Integration (REI). However,

the emerging WTO regime has in no way undermined the process of regionalism. It has wide

ranging implications for the global economy.

The South Asian Association for Regional Co-operation (SAARC) comprises the

seven countries of South Asia. i.e.,Bangladesh, Bhutan, India, Maldives, Nepal, Pakistan and

Sri Lanka. SAARC is a manifestation of the determination of the people of South Asia to

work together towards finding solutions to their common problems in a spirit of friendship,

trust and understanding and to create an order based on mutual respect, equity and shared

benefits. The primary objective of the Association is the acceleration of the process of

economic and social development in member states, through collective action in agreed areas

of co-operation.

South Asian nations all have not only a shared culture and a common history, but

also, a common destiny in the 21st century. South Asia constitutes 3% of world area, but

houses 22% of the world's population. South Asia also makes an integrated condominium of

common nvers, mountain system, ocean and a conjoint ecological system.


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The region suffers from massive balance of payments burden, mass unemployment,

high population growth rate, large concentration of poverty, low rate of economic growth,

constant food shortage, worsening terms of trade, largely illiterate, considerable

malnourished, and also the least gender sensitive region of the globe.

The combined GDp4 of South Asia US $ 609 trillion is only 1.8% of the world

GDP. Unsurprisingly therefore, per capita incomes are low. In 2000 the average per capita

income stood at $ 490 and therefore poverty is a serious problem confronting the south Asian

economies.

The South Asian economies differ rather significantly in size. For example", India

accounts for more than three-fourth of the region's GDP while Srilanka and Nepal contribute

only 2.7% and 0.9% to the regional GDP respectively. Pakistan and Bangladesh comprise

medium sized economies in the region and account for 11.7 and 8 percent respectively of the

regional GDP. There are also sharp variations in per capita incomes across the countries,

SriLanka's per capita income (US$ 860) is over three times that of Nepal (US$ 241). Whereas

Bangladesh, India, and Pakistan's per capita income is US$ 373, 459, and 516 respectively.

The Imports4 of South Asia increased from $37.7 billion in 1990 to $78.1 billion in

2000, indicating an annual growth rate of 9.8 percent, but the Exports increased at a more

rapid rate of 12.06 percent, from $27.3 billion in 1990 to $65.2 billion in 2000. India's

bilateral trade with the SAARC countries accounts for a small share in her trade. India's

Imports from SAARC countries increased marginally from 0.54% of the total Imports in

1991 to 0.73% in 2000. Whereas, the Exports rose to 4.43% in 2000 compared to 1.78% in

1991 (More than doubled).


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Due to the growing protectionist tendencies in the international market and the

increasing competition among suppliers, particularly in the developing world, the need to

evolve feasible strategies for regional economic co-operation in South Asia is becoming more

and more apparent. This is evidenced by the recent tempo of activities in this regard in the

South Asian region. Increased regional economic co-operation would help reduce the

economic dependence of the South Asian countries on the developed countries in the future.

Given the possibility that trade with the rest of the world does not offer very happy prospects

in the future, intra regional trade could facilitate growth and development of the South Asian

countries on the basis of the regional self-reliance. Such regional economic cooperation is

considered feasible because intra regional, historical, cultural, geographical and

developmental commonalities are much stronger than intra regional differences in political

and economic structures and perspectives. Besides, the sub continental economy of the South

Asian region offers potentially vast and undeveloped markets, and is blessed with huge

endowments of material and human resources. Against this background, the present study

attempts to review the trade structure and technological flows among SAARC countries and

to indicate a few areas for future co-operation. Also undertakes a detailed analysis of the

pattern of "revealed Comparative" advantage and the extent of trade complementarity in

South Asia, with a view to ascertaining whether or not the SAPTA (Saarc Preferential

Trading Agreement) and the existing trade structures of individual countries can support the

regional economic co-operation initiatives.


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SAARC Programs and Activities

Assessment, Monitoring, and Evaluation

The South Asian Association for Regional Cooperation (SAARC) established in 1985

includes Afghanistan, Bangladesh, Bhutan, India, Maldives, Nepal, Pakistan, and Sri Lanka.

Since its inception, a range of activities has been carried out by the SAARC, which can be

broadly categorized as follows:

Creation of the SAARC Integrated Programme of Action (SIPA), including

Agriculture and Rural Development; Communications and Transport; Social

Development; Environment, Meteorology, and Forestry; Science and

Technology; Human Resources Development; and Energy.

Signing agreements and conventions, including an Agreement on Establishing

the SAARC Food Security Reserve; Regional Convention on Suppression of

Terrorism; Regional Convention on Narcotic Drugs and Psychotropic

Substances; SAARC Convention on Preventing and Combating Triaff

checking in Women and Children for Prostitution; SAARC Convention on

Regional Arrangements for the Promotion of Child Welfare in South Asia;

Coordination of Positions on Multilateral Legal Issues; Agreement for

Establishment of South Asian University.

Initiation of SAARC programs, including poverty eradication; agreement on

SAARC Preferential Trading Arrangement (SAPTA) and Transition from

SAPTA to South Asian Free Trade Agreement (SAFTA); social charter;

SAARC Development Fund (SDF); and regional connectivity program.


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Establishment of SAARC regional centers, including Agricultural Information

Centre (Dhaka); Tuberculosis Centre (Kathmandu); Documentation Center

(New Delhi); Meteorological Research Centre (Dhaka); Human Resources

Development Centre (Islamabad); Energy Centre (Islamabad); Disaster

Management Centre (New Delhi).

Organization of People to People contact programs, including SAARC Audio-

Visual Exchange (SAVE) Programme; SAARC Documentation Centre (SDC);

SAARC Scheme for Promotion of Organized Tourism; SAARC Chairs,

Fellowships, and Scholarships Scheme; SAARC Youth Volunteers

Programme (SYVOP); SAARC Visa Exemption Scheme; South Asian

Festivals; SAARC Consortium of Open and Distance Learning (SACODIL)

and SAARC Awards.

There have been no institutionalized responses to the enthusiasm created by some of these

activities in the region. The euphoria with which these activities are launched dies down in no

time both in the absence of a proper monitoring and evaluation mechanism and because of

the lack of involvement of people and nongovernmental institutions in the exercise. There is

an increasing feeling that many of these activities are just initiated as summit rituals by the

heads of states and governments. An array of literature calls SAARC ritualistic, describes it

as suffocatingly slow, and criticizes it as a magnificent paper tiger, political white

elephant, talk shop of no consequence, military convoy in a mountainous region, a

regional pastime, a club of tongues, bureaucratic den, and so on. This chapter provides

specific instances in which the SAARC process has failed in fulfilling its objectives and in

meeting peoples aspirations as the only regional body for almost 24 years.


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1. POVERTY AND TERRORISM VERSUS RHETORIC

AND ACTION

1.1 Poverty Alleviation

The 6th SAARC Summit (Colombo, 1991) for the fi rst time accorded the highest priority

to the alleviation of poverty in South Asia and established an Independent South Asian

Commission on Poverty Alleviation (ISACPA), including eminent persons from member

states. The commission conducted an in-depth study of the diverse experiences of member

states and reported their recommendations on the alleviation of poverty to the 7th Summit.

The 1992 Commission on Poverty Alleviation set rather formidable macroeconomic targets

for the eradication of poverty in South Asia by 2002 (SAARC Secretariat 1992). The

Commission provided a radical conceptual framework for poverty alleviation through social

mobilization and empowerment in South Asia. To achieve this goal, it recommended that the

region would require the following:

An annual growth rate of 9.1 percent.

Doubling of per capita income from US$300 to US$600.

Lowering of incremental capital-output ratio from 4:1 to 3:1.

Increasing the marginal savings rate from the current level to 27 percent or

more.

The report elaborately discussed various micro-level interventions and lessons learned from

the tedious delivery systems of the state mechanism. In most of the South Asian countries the

delivery of services is carried out overwhelmingly by state agencies. Two very striking


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aspects of this delivery mechanism are found in this region. Firstly, the service delivery

mechanism in critical areas like heath, food supplies, education, drinking water, electricity

etc., has several layers of sub-institutions and sub-authorities and the actual delivery remains

slow, tardy and cumbersome.

And secondly, there is literal absence of monitoring and evaluation of the

services delivered and poor accountability of the agencies and institutions

involved in it. More seriously the leakages and corruption has become

both rampant and deep rooted making the issues of transparency and accountability

farfetched. This Report also mentioned the emergence of new trends at the grassroots level

and discussed the shifting focus from macro interventions to participatory micro development

organizations. On the basis of this report, the 7th SAARC Summit (Dhaka, 1993) for the first

time committed to eradicate poverty in South Asia by 2002. The declaration stated that the

Heads of State or Government committed their Governments unequivocally to the eradication

of poverty in South Asia, preferably by the year 2002 AD through an Agenda of Action

(SAARC Secretariat 1993) which would, among other things, embody the following:

A strategy of social mobilization involving the building of organizations of the

poor and their empowerment through appropriate national support

mechanisms, with the assistance of respective governments.

A policy of decentralized agricultural development and sharply focused

household-level food security through the universal provision of daal-bhaat or

basic nutritional needs.

A policy of decentralized small-scale labour intensive industrialization, with

the choice of efficient and cost-effective technology. A policy of human


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Poverty Eradication and endorsed the recommendations of the two rounds of meetings under

this mechanism hosted by India and Pakistan, respectively. They desired that the Ministers of

Finance/ Planning should meet again in the near future to give further impetus to this

process.

4. 10th Summit, 1998, Colombo

The Heads of State or Government reiterated the commitment of SAARC to the eradication

of poverty in the Region at the earliest possible, preferably by the year 2002. They

emphasized the need to encourage maximum participation by target groups in the formulation

and implementation of poverty eradication programmes. The Heads of State or Government

were of the view that such participation is essential for success of efforts in this field. They

stressed the need for effective utilization of the SAARC Three-tier Mechanism on Poverty

Eradication and in that context welcomed the offer of the Government of Pakistan to host the

next meeting of the SAARC Finance/Planning Ministers under the Mechanism in October

1998.

5. 11th Summit, 2002, Kathmandu

The Heads of State or Government acknowledged that investment in poverty alleviation

programs contributes to social stability, economic progress, and overall prosperity. They were

of the view that widespread and debilitating poverty continued to be the most formidable

developmental challenge for the region. Conscious of the magnitude of poverty in the region,

and recalling also the decision of the UN Millennium Summit 2000 to reduce world poverty

in half by 2015, and also recalling the commitments made at the five-year review of the

World Summit for Social Development to reduce poverty through enhanced social

mobilization, the Heads of State or Government made a review of the SAARC activities

aimed at poverty alleviation and decided to reinvigorate them in the context of the regional


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and global commitments to poverty reduction. The Heads of State or Government expressed

their firm resolve to combat the problem of poverty with a new sense of urgency by actively

promoting the synergetic partnership among national governments, international agencies,

the private sector, and the civil society. They reaffirmed their pledge to undertake effective

and sustained poverty alleviation programs through pro-poor growth strategies and social as

well as other policy interventions with specific sectoral targets. The leaders also agreed to

take immediate steps for the effective implementation of the programs for social mobilization

and decentralization, and for strengthening institution building and support mechanisms to

ensure participation of the poor, both as stakeholder and beneficiary, in governance and the

development process. The Leaders directed the Council of Ministers to coordinate efforts to

integrate poverty alleviation programs into the development strategies of Member States. In

this context, they agreed to reconstitute the Independent South Asian Commission on Poverty

Alleviation, with Nepal as its Convener and Bangladesh as Co-convener, for reviewing the

progress made in cooperation on poverty alleviation and for suggesting appropriate and

effective measures.

6. 12th Summit, 2004, Islamabad

We recognize poverty alleviation as the greatest challenge facing the peoples of South Asia

and declare poverty alleviation as the overarching goal of all SAARC activities. It is

imperative to relate regional co-operation to the actual needs of the people.

Provision of basic needs, promotion of literacy, and better health care are a regional priority.

It is important to undertake effective and sustained poverty reduction programmes through

pro-poor growth strategies and other policy interventions with specific sectoral targets.

The Plan of Action on Poverty Alleviation, prepared by the meeting of Finance and Planning

Ministers in Islamabad in 2002, is hereby approved. The reconstituted Independent South


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Asian Commission for Poverty alleviation (ISACPA) has done commendable work. An

effective strategy should be devised to implement suggestions made in its Report Our

Responsibility.

7. 13th Summit, 2005, Dhaka

The Heads of State or Government decided to declare the decade of 20062015 as the

SAARC Decade of Poverty Alleviation. During the Decade, endeavorsboth at the national

and regional levelwill continue to be made with a sense of commitment and urgency to free

South Asia from poverty They entrusted the ISACPA to continue its advisory and

advocacy role in this regard. They decided to focus on formulation and implementation of

concrete regional programmes and projects as well as forging partnerships among all

stakeholders.

8. 14th Summit, 2007, New Delhi

The Heads of State or Government appreciated the Independent South Asian Commission

on Poverty Alleviation (ISACPA) for its elaboration of the SAARC Development Goals

(SDGs), which reflect the regional determination to make faster progress toward attaining the

Millennium Development Goals (MDGs). They agreed that the national plans for poverty

alleviation should appropriately mirror the regional consensus reached in the form of the

SDGs and the Plan of Action on Poverty Alleviation.

Deciding that resource mobilization for achieving the SDGs would remain a high priority in

the Decade of Poverty Alleviation, the Leaders directed translation of the highest regional

level political commitment into action for creating opportunities for productive employment

and greater access to resources for the poor that are essential for them to enhance their

livelihood and realize their potentials. They entrusted the Two-tier Mechanism on Poverty


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Alleviation to monitor the progress and fi ne-tune the approaches toward pro-poor growth

process.

9. The New Goal

The Twenty-Seventh Session of the Council (Dhaka, 12 August, 2006) endorsed its

recommendations that (a) SDGs would be achieved in the next fi ve years starting from year

2007 and (b) a mid-term review on the attainment of SDGs would be undertaken toward the

end of the third year.


The Heads of State or Government resolved to continue to combat poverty through all

available means, including especially through peoples empowerment. They committed

themselves to continuing to share each others experiences and success stories of pro-poor

poverty reduction strategies such as micro-credit systems, community-driven initiatives and

the raising of the consciousness of the poor on their right to resources and development

They emphasized undertaking sustained efforts, including developing and implementing

regional and sub-regional projects toward the attainment of SAARC Development Goals

(SDGs). They noted the decision by the Ministers on Poverty Alleviation to obtain an

intergovernmental mid-term review of the attainment of the SDGs to be completed by 2009.

Source SAARC Secretariat 19932008.

While providing a Road Map towards a Poverty Free South Asia, the

report highlighted the following strategic priorities:

Mobilizing the Power of the Poor

Prudent Macroeconomics


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Mainstreaming the Informal Economy

Enhancing Gender and Other Equities

Sustainable Development

Effective, Harmonious, and All-round Cooperation among the Countries of the

Region

The 12th Summit (Islamabad, 2004) provided continuity to ISACPA, giving it a special

advocacy role to enable it to guide follow-up actions on its report. The Commission was

given the task preparing the SDGs (SAARC Secretariat. For the fi rst time, a SAARC Poverty

Alleviation Fund (SPAF) was established with contributions to be voluntary or assessed, as

may be agreed. India has already offered US$100 million (2005) for poverty alleviation

projects with a regional dimension. The SPAF shall function within the SADF, which has

been reconstituted, as the SAARC Development Fund (SDF). The three-tier mechanism on

poverty alleviation has been replaced by a two-tier mechanism, comprising ministers and the

secretaries dealing with poverty alleviation at the national level. In addition, the Secretariat

published three regional poverty profitless.

The 27th Session of the Council (Dhaka, 12 August 2006) endorsed its recommendations

that (a) SDGs would be achieved in the next fi ve years starting from year 2007 and (b) a

mid-term review on the attainment of SDGs would be undertaken toward the end of the third

year. ISACPA could play an overall oversight role on the SDG regional reporting process.

However, how far these recommendations will be internalized by the member countries, what

institutions they will involve, and in what way the SAARC process will be involved are of

significant interest (SAARC Secretariat 2007b).


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1.2 Poverty Alleviation: Rural India

The adverse effect of the economic downturn continues to impact the lives of millions of

poor and vulnerable globally. The steep increase in the food and energy prices, falling values

of national currencies, decline in purchasing power due to shrinking employment

opportunities, progressive disengagement of the national governments in many countries

from social sectors due to resource crunch etc. have precipitated the accentuation of the

worsening economic conditions of poor and marginalized communities in general and rural

poor in particular in most countries of the world. Notwithstanding this worldwide

phenomenon, due to the proactive and consistent policy decisions promoting the doctrine of

inclusive economic growth with unhindered focus on the social sector particularly on rural

development, the Indian rural populace are not only insulated from the onslaught of global

economic downslide but in actuality, the rural economy is in an unprecedented boisterous

course of ascendency.

1.2.1 Mahatma Gandhi National Rural Employment Guarantee

Act (MGNREGA)

Ensuring a minimum level of livelihood security in the rural areas has been one of the

daunting tasks for successive governments. Evolving the design of the wage employment

programmes to more effectively fight poverty, the Central Government formulated the

National Rural Employment Guarantee Act (NREGA) in 2005. National Rural Employment

Guarantee Act 2005 (NREGA) was launched with effect from 2 nd February, 2006. During

2009-10, through an amendment the NREGA has been rechristened as the Mahatma Gandhi

National Rural Employment Guarantee Act (MGNREGA). To start with, 200 selected


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districts of the country were brought under its ambit. In 2007-08, it was extended to 130 more

districts. As against the original target of 5 years, within three years of its launch MGNREGA

has been extended to all the districts from 1st April 2008.

Being the first ever law internationally, that guarantees wage employment in an

unprecedented scale, MGNREGA aims at enhancing livelihood security of households in

rural areas of the country by providing at least one hundred days of guaranteed wage

employment in a financial year to every household whose adult members volunteer to do

unskilled manual work. Unique features of the Act inter alia include, time bound employment

guarantee and wage payment within 15 days, incentive-disincentive structure to the state

governments for providing or not providing employment as per demand, emphasis on labour

intensive works prohibiting the use of contractors, and machinery, ensure the creation of

durable community, social and economic infrastructure and assets in the rural areas. The Act

also mandates 33 per cent participation for women. The potential of NREGA spans a range of

possibilities.The choice of works suggested in the Act addresses causes of chronic poverty

like drought, deforestation and soil erosion, so that the process of employment generation is

maintained on a sustainable basis. The Act is also a significant vehicle for strengthening

decentralization and deepening processes of democracy by giving a pivotal role to local

governance bodies, that is, the Panchayati Raj Institutions.

1.2.2 Swarnjayanti Gram Swarojgar Yojana (SGSY)

Assisting the rural poor in self employment by encouraging group and cluster activities,

providing skill development opportunities, credit linkages and subsidies and creation of

marketing opportunities for products has been another major plank of the Poverty alleviation

schemes of the Government. Launched on 1st April 1999, Swarnjayanti Gram Swarojgar

Yojana (SGSY) is an integrated scheme for providing opportunities of self employment to the


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rural poor. The assisted families (Swarojgaris) may be individuals or Groups (Self Help

Groups). However, the emphasis is on Group approach and also with particular emphasis on

group formation by women and the weaker sections. It has been conceived as a holistic

programme of self employment and some of its salient features are:

Organizing the rural poor into Self Help Groups (SHGs) through social

mobilization.

Key activity and development of activity clusters.

Training and marketing support to the Swarojaris.

Social mobilization and training and capacity building of Self Help Groups.

SGSY is being implemented by the District Rural Development Agencies (DRDAs) with the

active participation of Panchayat Raj Institutions, the Banks, the line Departments, and Non-

Governmental Organisations. In order to provide incentives to rural artisans, SARAS fairs are

also organized in various parts of the country to promote sale of products produced by Self-

Help Groups. Since the inception of the Programme 42.69 lakh SHGs have been formed.

During 2010-11, a total of 21.09 lakh Swarojgaries were assisted out of which 14.24 lakh

(69.49%) were women Swarojgaries. In 2011-12, till December, 10.47 lakh Swarojgaries out

of which 7.23 lakh(69.07) were women. SGSY has been restructured as National Rural

Livelihoods Mission (NRLM), now renamed as Aajeevika, to implement it in a mission

mode in a phased manner for targeted and time bound delivery of results. Aajeevika

recognizes that the poor people have the potential to come out of poverty with proper

handholding, training and capacity building and credit linkage. Aajeevika also believes that a

strong institutional architecture owned by the poor, enables them to access institutional credit

for various purposes, pursue livelihoods based on their resources, skills and preferences and


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also to access other services and entitlements, both from the public and private sector.

Therefore, Aajeevika will focus on building strong institutions of the poor into Self Help

Groups (SHGs), their federations and livelihoods collectives.

1.2.3 Indira Awaas Yojana (IAY)

Since the beginning of the planned development one of the major and daunting tasks

engaging the attention of successive governments has been to effectively address the issue of

rural housing shortage. Shelter is one of the basic human requirements for survival and

dignity. To meet the shortage of housing in rural areas, the Government of India had

launched a comprehensive scheme Indira Awaas Yojana. Since inception of scheme about

272.83 lakh houses have been constructed with an expenditure of `78986.81 crore (upto end

2011). Rural Housing is one of the six components of Bharat Nirman Programme. Under

Bharat Nirman Programme Phase-I, 60 lakh houses were envisaged to be constructed through

Indira Awaas Yojana all over the country during the four years i.e. from 2005-06 to 2008-

2009. Against this target, 71.76 lakh houses were constructed with an expenditure of

`21720.39 crore. The target for the next five years period starting from the year 2009-10, has

been doubled to 120 lakh houses.During the first two years of the Bharat Nirman Programme

Period-Phase-II, approx.70.81 lakh houses have been constructed.

1.2.4 Pradhan Mantri Gram Sadak Yojana (PMGSY)

The linkage between development and poverty alleviation in rural areas with a well laid road

infrastructure needs no emphasis. As such, in December, 2000, a 100 % centrally sponsored

scheme namely Pradhan Mantri Gram Sadak Yojana (PMGSY) was launched with the

objective of providing connectivity by all weather roads to about 1.60 lakh unconnected

habitations with population of 500 persons and above (250 persons and above in respect of


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hill States, the tribal and the desert areas) through good allweather roads in the rural areas by

the end of Tenth Plan Period (2007) at an estimated cost of about `60,000 crore. After

launching the programme and the experience of the first 3 years with the average cost of

construction of PMGSY roads, the cost of the programme was revised in 2003-04 to

`1,32,000 crore (as against `60,000 crore projected initially). Government of India has

identified Rural Roads as one of the six components of Bharat Nirman with a goal to

provide connectivity to all eligible unconnected habitations with a population of 1,000

persons and above (as per 2001 census) in plain areas and 500 persons and above in the case

of hilly or Tribal areas Schedule V) with an all-weather road. Upto January 2012, a total of

42,531 habitations have been connected out of 63,940 habitations to be connected and works

for 58,387 habitations sanctioned. In 2011- 12, a target of 4000 habitation is set to be covered

and 33,000 kms of road length is to be constructed. Till January 2012, a total of 4142

habitations have been covered and 21750 kms of road has been constructed. General approval

under Section 2 of Forest (Conservation) Act 1980 for diversion of forest land up to 5 ha for

creation of critical public infrastructure projects in 60 IAP districts has been given and orders

have been issued, which covers rural roads. One of the litmus tests for any welfare state is the

kind of social security it provides for the vulnerable sections of its population

1.2.5 National Social Assistance Programme (NSAP)

The Directive Principles of State Policy in the Constitution of India enjoin upon the State to

undertake, within its means, a number of welfare measures. In particular, Article 41 of the

Constitution of India directs the State to provide public assistance to its citizens in case of

unemployment, old age, sickness and disablement and in other cases of undeserved want

within the limit of its economic capacity and development. It is in accordance with these

noble principles that the Government of India on 15th August 1995 included the National


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Social Assistance Programme (NSAP) in the Central Budget for 1995-96. The NSAP then

comprised of National Old Age Pension Scheme (NOAPS), National Family Benefit Scheme

(NFBS) and National Maternity Benefit Scheme (NMBS). On 1st April, 2000 a new scheme

known as Annapurna Scheme waslaunched. This Scheme aimed at providing food security to

meet the requirement of those senior citizens who, though eligible had remained uncovered

under the NOAPS. Under Annapurna Scheme10 kg of food grains per month is provided free

of cost to the beneficiary. Under NOAPS `75 per month was being provided per beneficiary

to destitutes who were 65 years of age or above. The amount of pension was increased to

`200 per month with effect from 1.4.2006 and the States were requested to top up with

another `200 from their own resources. Government of India on 13.9.2007 modified the

eligibility criteria for grant of old age pension to persons aged 65 years or higher and

belonging to a household below the poverty line according to the criteria prescribed by the

Government of India.

SAARC'S achievements:

The highest authority of the Association rests with the Heads of State or Government, who

meet annually at summit level. To date, 12 such summit level meetings have been taken

place.

The Council of ministers comprised of SAARC Foreign Ministers is responsible for policy

formulation and view of activities, it meets twice a year and may also meet in extraordinary

session.

The Committee on Economic Co-operation, comprising of SAARC commerce secretaries,

was established in 1991. The SAARC secretariat located In Kathmandu IS headed by


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Secretary-General (nominated by member states In alphabetical rotation), seven directors,

one from each member state and general staff.

Four SAARC regional centers have been set up:

Agricultural Information Center - Dhaka

Tuberculosis Prevention Center - Katmandu

Meteorological Research Center - Dhaka

Documentation Center - New Delhi

A fifth regional center on HRD is being set up in Islamabad.

An independent South Asian Commission on poverty alleviation was established in 1991.

The SAARC convention on suppression of terrorism, The SAARC convention on Narcotic

Drugs and psychotropic Substance came into effect from 1998 and 1993 respectively. A

SAARC visa exemption scheme has been in operation from 1992 is promoting closer contact

among the people of the SAARC countries.

The SAARC Chamber of commerce and industry (SCCI) has been established at Islamabad

(Pakistan) in 1992. The Ninth SAARC Summit established the group of eminent persoas in

1997 to undertake a comprehensive appraisal of SAARC. The GEP has submitted the report

"SAARC vision beyond the year 2000". Some of the important recommendations of the GEP

are:

Achievement of SAFTA in 2008

Setting up of South Asian Development fund of around $ 500 million.

Setting up of South Asian Development Bank.


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Adoption of Social Charter for SAARC.

The first and third recommendations of the above have been accepted in 10 th SAARC

Summit held at Colombo in 1998. The Framework Agreement on the SAARC Preferential

Trading Arrangement (SAPTA) was signed in 1993, which came into force from December

1995 provided a boost to trade within the region.

Recent measures stated in a meeting by the President of

SAARC Chamber Of Commerce and Industry with the

deep concern for trade between Pakistan and India

Tariq Saeed, the president of SAARC connotes that:

The non government agencies and corporations take the progressives steps

towards the trade and also taking steps towards the poverty alleviation.

By developing trustable relations among the neighboring countries, SAARC

leads towards achieving the high status globally.

SAFTA resolved the tariff problems for the purpose of promoting the trade

among all the member states,LDCs are zero rated among all the other member

states of SAARC.

Pakistan will be able to interact with a large population for the purpose of

importing and exporting its goods.

To overcome the monopoly created by the zero rated products of other

member states, Pakistan has to bring the technological improvements for the


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purpose of achieving the improved productivity and having the competitive

advantages over the products of other states.

In the early sixties, Pakistan and China were at the same trade level but China

promotes its trade with a rapid increased rate but the Pakistan is still on the

way to progress.

For the purpose of better management and for implementing reactive trade

measures headquarters of SAARC are required to be built in Islamabad, for

which funding is required. Requesting the LCCI to make a confirmed booking

of office for the purpose of spreading the network of the chambers of member

states.

Trade Barriers and Facilitations among SAARC Economies

The South Asian Association for Regional Cooperation (SAARC) is a political and

economical organization in South Asia. It is the largest regional organization and was

established on December 8, 1985 by Bangladesh, Bhutan, Maldives, Nepal, Pakistan, India,

and Sri Lanka. Eighth country Afghanistan was added on the request of India on November

13th, 2005 and became a member of SAARC on April 3, 2007. The purpose of the

establishment of SAARC is to provide platform to the people of Southern Asia to make joint

efforts to promote harmony, conviction, and understanding among states.WTO aims to

facilitate the free trade among member countries. But the issues of restriction on trade,

customers safety, human privileges and environmental harms are prominent in developed

and less developed countries. After the failure of its implications, an alternative regional trade

agreement (RTA) was established in WTO and then developed countries and developing

countries moved to regional trade agreements or bilateral trade agreements. SAARC was

entered in regional trade agreement in 2004. Before entering in the (RTA), South Asian


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Preferential Trading Agreement (SAPTA) was formed in 1993 and it would be changed into

South Asian Free Trade Agreement (SAFTA) in January 6, 2004 on the 12th Summit at

Islamabad. (Ali & Talukder,2009 and Chaturvediet al., 2007) This study highlights the main

trade barriers among SAARC member states. This work also attempts to identify the

maximum facilitations provided by the management of SAARC and by the legal regulations

of the governments of the contracting states. Literature gives a brief discussion on the

SAARC and then trade among SAARC.

SAARC and India

Policy Issues hinge on security and democracy

The entire project of SAARC is dependent on Indias capacity to bind the neighbouring states

in multiple networks of ties to promote regional cooperation. India not only shares frontiers

with all the SAARC countries, but also ethnic, linguistic, cultural and religious histories. If

India can persuade SAARC members to view south Asia as a viable regional entity, it can

promote projects of development cooperation. But thats easier said than done. For, the

success of such an enterprise depends on how well the problems pertaining to security and

democracy are addressed.

Rajen Harshe

Indias refusal to attend the 13th summit of the South Asian Association of Regional

Cooperation (SAARC) and the eventual postponement the SAARCs Dhaka summit of

February 2005 has raised a number of questions regarding the likely course and the prospects

of regional cooperation in south Asia. Indias decision to keep out of the summit apparently

was shaped by two major concerns. First, some of the recent events in Bangladesh such as the


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attack on Sheikh Hasina, the deaths of Belaluddin, a journalist, and former finance minister

Shah A. Kibria in two separate bomb blasts have made India apprehensive of the

deteriorating law and order conditions in Bangladesh. Besides, Khaleda Zia regimes support

to insurgent groups in Indias northeast and persistent attacks on democratic and secular

parties by anti-India fundamentalist groups linked to the ruling Bangladesh Nationalist Party

(BNP) have merely compounded the security related anxieties of India. Under these

circumstances, Dhaka as a venue of the summit with the prevailing political turmoil in

Bangladesh made India wary of security arrangements in the host country. Second, King

Gynendras seizure of power in Nepal, through suspension of the democratic and

constitutional processes, also prompted India to refrain from sharing the platform with the

Gynendra regime that has undermined the nine-year-old constitutional monarchy in Nepal.

Since it is inconceivable to visualise any form of cooperation within south Asia without the

active participation of an overwhelmingly powerful state such as India the 13 th SAARC

summit had to be postponed. The postponement of the summit has made the other members

of SAARC, including Bangladesh, Sri Lanka and Pakistan apprehensive of Indias

hegemonic role and its capacity to virtually block any move towards cooperation among the

seven SAARC member states. Indeed, the lack of rapport between India and other SAARC

member states could as well damage the likely projects of development cooperation within

SAARC. Considering the enhanced significance of the organisations like SAARC in the

context of globalisation, it may be worth taking a fresh look at SAARC amid a deteriorating

security environment as well as the questions related to democracy and development within

south Asia.

In general, the SAARC and its course of development has to be reviewed and appraised in the

context of the world wide resurgence of regional cooperative movements that constitute a

major response to the challenges of globalisation. In fact, the post cold war world has been


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witnessing the advent, refashioning and resurgence of multiple kinds of regional

organisations in the developed as well as developing countries. The European Union (EU),

North Atlantic Free Trade Agreement (NAFTA) and Asia Pacific Economic Community

(APEC) offer perhaps the most obvious examples of this process. These cooperative ventures

are also being built around dominant regional powers. For instance, Nigeria and South Africa

are the sheet anchors of organisations such as the Economic Community of West African

States (ECOWAS) or Southern African Development Community (SADC) respectively.

Plausibly, the entire project of SAARC is dependent on Indias capacity to bind the

neighbouring states in multiple networks of ties to promote regional cooperation because

India shares frontiers with all the SAARC countries. It also has commonalities in ethnic,

linguistic, cultural and religious terms with all its neighbours. Being the most powerful and

virtually the core state within SAARC, India has the greater responsibility to visualise and

build, along with its neighbours, south Asia as a regional entity. By taking a lead in

persuading other SAARC members to think about south Asia as a viable unit India can

promote projects of development cooperation that can bring about regional harmony. And

yet, if the problems pertaining to security and democracy are not addressed India will not be

able to play the role of a catalyst stimulating cooperative movements.

Spill-Over Effects of Crisis in Nepal

Indias dilemmas in the region may be highlighted with a few evocative illustrations from

Nepal, which, at this juncture, seems to have captured the centre stage of Indias concerns in

south Asia. Internally, the Maoists are challenging the political system of Nepal. Owing to its

acute social problems including abject poverty, inequalities generated by the caste ridden

social structures and gross asymmetry in income distribution, Maoism has over the decades

gradually begun to appeal to sections of the Nepalese population who were disgruntled with


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the existing political system. The Maoist group captured nine seats in the parliament of

Nepal in 1996. Frustrated by the slow pace of change within the constitutional framework the

Maoists chose to carry on the fight against the existing system with the idea of overthrowing

it through the armed struggle. By now the Maoist rebels underground. They have not merely

established control over 40 per cent of the territory of Nepal but gathered active support of

over 2-3,000 armed prachanda or fierce fighters along with a militia of over 15,000 men.

Over the years, they have created sound linkages with the other extremist groupings across

the borders including those in the Terai region of Nepal that border India, the Maoists/

Naxalites of Bihar and Andhra Pradesh and the north-eastern insurgents in India. In the nine

years of insurgency in Nepal, the Maoists have continuously widened their base of operations

by providing smuggled arms to the ever-expanding number of recruits. The resulting

deteriorating state of law and governance in Nepal has already claimed thousands of lives.

The Deuba regime allegedly failed to tackle the Maoist rebels and improve the law and order

situation, which, in turn, gave king Gyanendra a pretext to take over the reigns of

administration in Nepal.

The developments in Nepal cannot be viewed in an isolated manner because the countrys

strategic location has high value for major powers. Any power able to station space linked

surveillance, intelligence and navigation systems on the high mountains of Nepal can gain

geo-strategic leverage in several Asian regions from central to south east Asia. Since Nepal

borders China and India, the dominant forces in Nepal can prove crucial to either of these

powers. Besides, the Nepalese frontier is only 185 miles away from New Delhi. That is why,

stability and friendship with Nepal is essential for India to strengthen its security.

Since the Indian government has supported the Nepalese regimes with arms to handle the

Maoist rebels, the latter are likely to seek support from China while in opposition or in

power. Moreover if Nepal slides towards China and India fails to control the north eastern


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insurgencies, external powers like China and Myanmar are likely to play a more significant

role in Nepal, Bangladesh and north eastern affairs. Moreover, Nepal has already become one

of the priority centres of the Inter Services Intelligence (ISI) of Pakistan, which is headed by

a Brigadier. The links between the ISI, terrorist Islamic outfits in Pakistan, Nepal,

Bangladesh and Bhutan continue to be a constant source of security threat, especially after

the Pakistani-sponsored terrorists hijack of the Indian Airlines plane flying between

Kathmandu and Kandahar in December 1999. The ISI-sponsored terrorist centres in

Bangladesh are, in their turn, linked with multinational terrorist outfits such as Al Qaeda.

Similarly, till 2003, the rebels of the United Liberation Front of Assam (ULFA) enjoyed

support from Bhutan. At one stage the ISI and Harkat-Ul-Mujahideen, a terrorist outfit of

Pakistan, were actively supporting the ULFA through funds as well as by imparting training

in six districts of Assam. Out of these districts of Kokrajhar, Goalpara, Darrang and Nalbari

share borders with Bhutan.

Vitiating Security Environment

Apart from vitiating the security environment through their subversive military related threats the

terrorist outfits are linked to the underworld as well. In fact, south Asias location between the two

largest areas of illicit opium production, namely Golden Crescent, comprising north western countries

of Afghanistan and Pakistan and Golden Triangle consisting countries such as Myanmar and

Bangladesh in the east pose problems to health security. At this juncture opium, heroin and hashish

are exported across the borders as well as via the sea-lanes to Sri Lanka and Maldives. India itself

cultivates opium poppy illicitly of over 1200 to1500 tons annually.

Besides Nepal the threat of terrorism has and is likely to pose challenges to development cooperation

from two other major countries namely, Pakistan and Sri Lanka. Since the 1990s Pakistan-sponsored

cross border terrorism has played havoc in the states of Jammu and Kashmir. Through the bomb

blasts in different parts of India including major cities like Mumbai and Kolkota as also the abortive


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attempt to explode the Indian parliament on December 13, 2001 the militant Islamic outfits were able

to unleash a reign of fear in the Indian psyche [Harshe 2003]. However, with the ongoing Indo-

Pakistan talks to promote peace and President Musharrafs assurance that Pakistan will prevent any

terrorist operations from its soil has, at least, brought a momentary semblance of peace in the sub-

continent. However, it is going to be difficult for any regime to dismantle well-entrenched terrorist

infrastructures in Pakistan. Likewise, in spite of the three-year-old Oslo-initiated reconciliatory

process between the Sri Lankan government and Liberation Tigers of Tamil Eelam (LTTE), peace

seems to elude Sri Lanka. After the ceasefire, the government virtually granted de facto control to the

LTTE over the areas in the northeastern parts. Apparently the government aimed at devolution of

powers within the federal framework but such devolution has added to the new resolve of LTTE to

press for independent eelam especially after the devastating impact of tsunami in northeastern Sri

Lanka. The LTTE wants to monopolise post tsunami rehabilitation and reconstruction work in the

northeast. This has held up the formation of joint mechanisms comprising the government and the

LTTE to disburse funds in the tsunami-affected areas. If the third party mediation from Norway is

able to activate the stalemated peace process in Sri Lanka the possibility of war could be averted in

the island.

Indo-Pak Cooperation

Indeed, the strain between India and Pakistan may be mitigated if both the countries concentrate on

the economic dimensions of their ties. However, there is no direct correlation between strained

relationship and trade ties. For instance, under General Zias military dictatorship Indo-Pakistan trade

received an impetus when Pakistan raised the quota of permitted tradable Indian goods from 42 to 249

in 1987. The trade between the two countries peaked to US $ 354 million as they went through

nuclear tests in 1998. In 2001, under the Musharraf regime, Indian exports to Pakistan were the

highest ever i.e. US $ 219 million. [Quoted in Taneja 2004: 326]. Furthermore, the informal cross

border trade as also the trade carried through places like Dubai, Afghanistan and countries of


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Commonwealth of Independent States (CIS) between the two countries is roughly worth U.S. $2

billion. (Ibid)

There is also a dire need to explore trade potentials between India and Pakistan. Certain unfavourable

factors such as the lack of mutual confidence as well as information, mutual apprehensions and at

times misinformation have obstructed the course of building smooth trade ties. Moreover, India has

accorded the Most Favoured Nation (MFN) status to Pakistan, as a trading partner, while Pakistan has

not reciprocated with the same facility to India. India is in a position to export diverse kinds of items

including iron ore, steel, transport equipments like scooters, motor cycles and passenger cars, plastics,

textiles, drugs, pharmaceuticals and a number of agricultural products to Pakistan. In its turn, Pakistan

can export fruits, nuts, spices, pulses and metal scraps to India. India is the more sound and powerful

of the two economies and hence Pakistan is apprehensive of Indian goods invading the Pakistani

market. Since India has already opted to offer favourable trade terms to the goods from Sri Lanka and

Bangladesh it can conceive of applying the Gujral Doctrine of non-reciprocity in its trade relations

with Pakistan to counter such apprehensions1 [Harshe 1999]

It also needs to be underscored that there is enormous potential to promote Indo-Pakistan cooperation

in the energy sector. Apart from meeting Indias mounting demand as supplier of energy Pakistan can

make full use of its location on the transit route from the energy heartland of Iran to India. If the oil

pipeline from Iran via Pakistan to India becomes functional Pakistan will be in a position collect hefty

transit fees of roughly U.S. $600 to 800 million annually. The oil pipeline project would go through

only when the agreements between the three countries ensure the security of oil supply. If there are

diversified sources of pipelines gas, India will be able to reduce its dependence on more expensive

liquid natural gas. Trade and other forms of interactions could be facilitated through road links such

as Srinagar-Muzaffarabad or Mumbai Karachi ferry service. There are also immense possibilities of

promoting cooperation in Information Communication Technology (ICT).


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2. Suppression of Terrorism

Large-scale terrorist violence continues to beset South Asia today (Khatri and Kueck 2003;

Lama 2006). The inclusion of Afghanistan as the eighth member of the SAARC adds a new

dimension to this violence. The SAARC Regional Convention on Suppression of Terrorism

was signed during the 3rd SAARC Summit (Kathmandu, November 1987). It came into force

on 22 August 1988. This Convention provides for a regional approach to well-established

principles of international law in respect of terrorist offenses. It includes such provisions as

sharing of information on terrorist activities and extraditions. Article VIII of the Convention

emphatically states that contracting States shall cooperate among themselves, to the extent

permitted by their national laws, through consultations between appropriate agencies,

exchange of information, intelligence and expertise and such other cooperative measures as

may be appropriate, with a view to preventing terroristic activities through precautionary

measures (SAARC 1988). This Convention led to the establishment of a SAARC Terrorist

Offences Monitoring Desk (STOMD) in Colombo in 1990 primarily to collate, analyze, and

disseminate information about the terrorist incidences, tactics, strategies, and methods.


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1The second meeting of legal advisers in 2002 emphasized the importance of the following to give

practical effect to this Convention:

(a) adoption of comprehensive domestic legislation by member states and

(b) harmonization of the national legal regimes in the region.

Following this second meeting, the SAARC Interior/Home Ministers met in 2007

in New Delhi.Like any other SAARC activity, because of the sensitivity of this issue, the Convention

on terrorism has been totally marginalized and made in redundant. Year after year since 1988 the

SAARC Summits have passed the same resolution asking the member countries to make enabling laws

compatible with the Convention (Table 17.2). Some member countries have consistently failed to enact

enabling domestic legislation that is compatible with the Convention. The absence of this most

fundamental action toward implementing the Convention has made it ineffective.

Prevention and Combating Terrorism-related Declarations in SAARC

Summits since 1988

1. 4th Summit, 1988, Islamabad

Thus refl ecting the sincere desire on the part of the Member States to enter into meaningful

cooperation to eliminate the scourge of terrorism from the South Asian region. They called for the

adoption of enabling measures by Member States to implement the Convention at the earliest.

2. 5th Summit, 1990, Male

They called for expeditious enactment of enabling measures for the implementation of the SAARC

Regional Convention on Suppression of Terrorism. They also urged Member States to continue to

cooperate in accordance with the Convention.



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They stressed in particular, the urgent need for the expeditious enactment of enabling legislation by

those Member States which had not yet done so, for the implementation of the Convention and the need

for a constant dialogue and interaction among the concerned agencies of Member States, including

submission of periodic recommendations to the Council of Ministers.

4. 7th Summit, 1993, Dhaka

The Leaders reiterated the need to give high priority to the enactment of enabling legislation at the

national level to give effect to the SAARC Regional Convention on Suppression of Terrorism, while

urging the Member States which had not yet done so, to make every effort to finalize this matter before

the Eighth SAARC Summit.

Despite their determination to prevent and suppress terrorism in all its forms and manifestations,

member countries have not been able to share even the basic information.

Terrorist activities both within a country and on a cross-border basis have sharply gone up despite the

existence of this Convention.2Despite several reiterations and reaffi rmation of their commitment to the

Convention on Suppression of Terrorism by the heads of state or

government, not a single action has been taken under this Convention. In almost every Summit the

member states expressed

3.DELIBERATE INACTION AND POOR ACCOUNTABILITY

3.1 Integrated Programme of Action

One can cite several instances of deliberate inaction. The In tegrated Programme of Action (IPA)

includes nine areas of coopera tion that form the core of the SAARC process. The IPA provided the fi

rm foundation from which regional cooperation could take off. Each IPA is conducted by a Technical

Committee, which helps member states build up or reinforce


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their national capabilities and undertake coordinated programs and activities at national and regional

levels. The Technical Committee could examine broad relation ships at the policy level between IPA

activities and economic and social development in a catalytic,promotional, and advisory capacity with

a view toward incorporating various recommended program s

into mainstream development.

Over the years, IPA has undergone several changes, including in the number of its activities. Under the

reconstituted SAARC Integrated Programme of Action (SIPA) in 2000, the number of Technical

Committees was reduced from 11 to 7 (that is, Agriculture and Rural Development; Communications

and Transport; Social Development; Environment, Meteorology, and Forestry; Science and

Technology; Human Resources Development; and Energy. As a whole, the SIPA activities have

broadly led to personal contact among the experts of the region in their specific fields of specialization.

It has facilitated the exchange of data and information and the creation of seminars, workshops, and

training courses.

2.2 SAARC Food Security Reserve

The SAARC Food Security Reserve is another example of how inaction could lead to the erosion of

confi dence on the SAARC system. This reserve was established in 1988 primarily to provide for a

reserve of food grains to meet emergencies in member countries. Reserves stood at 241,580 tons as of

January 2002. In 2002, 14 years after its implementation, the 9th Meeting of the Board (Islamabad,

December 2002) for the first time identified institutions and organizations in member states that could

be contacted in case of emergency requirements for withdrawal from the reserve. Again after 20 years

of sheer non-implementation of the SAARC Food Reserves, this program has been revamped and

renamed into an Agreement on Establishing the SAARC Food Bank in 2007. This renamed

institution discusses the establishment of a permanent headquarters of the food bank with a dedicated

staff.This food reserve has remained notional to date. No one knows its location. So far, the food


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reserves have never been used despite pressing demands in several disaster situations, including the

wheat crisis in Pakistan, a cyclone hit in Orissa, a fl ood in Bangladesh, the tsunami in Sri Lanka, and

Maoist violence leading to food insecurity in certain districts of Nepal. Even in the recent cyclone

(Sidr) disaster in Bangladesh in November 2007, despite theunprecedented food insecurity in the

affected areas, the SAARC Food Reserve was never invoked and utilized.

Education, Human Resource Development and Youth

Mobilisation

India is a Nation of young people out of a population of above 1.2 billion, 0.672 billion

people are in the age-group of 15-64 years, which is usually treated as the working age population.

This large population should be considered as an invariable human resource and they should be

provided the necessary skills so as to empower them to lead a purposeful life and contribute to our

national economy, which is possible only through quality education.

The Central Government continues to play a leading role in the formulation and

implementation of educational policies and programmes, the most notable of which is the National

Policy on Education (NPE) 1986, as modified in 1992. The modified policy envisages, inter-alia, a

National System of Education to bring about uniformity in education, making adult education

programmes a mass movement, providing universal access, ensuring retention and improving quality in

elementary education, special emphasis on education of girls, establishment of pace-setting schools like

Navodaya Vidyalayas in each district, vocationalisation of secondary education, synthesis of

knowledge and inter-disciplinary research in higher education, starting more Open Universities in the

States, strengthening of the All India Council for Technical Education, encouraging sports, physical

education, Yoga and adoption of an effective evaluation method, etc.


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2.1 Elementary Education

Article 21-A of the Constitution of India and its consequent legislation, the Right of Children to Free

and Compulsory Education Act 2009, became operative in the country on 1st April 2010. This

development has far reaching implications for elementary education and for the implementation of

Sarva Shiksha Abhiyan (SSA), in the years to come. This development implies that every child has a

right to elementary education of satisfactory and equitable quality in a formal school which meets

certain essential norms and standards.

2.1.1 Kasturba Gandhi Balika Vidyalaya (KGBV)

KGBVs are residential upper primary schools for girls from SC, ST, OBC and Muslim communities.

KGBVs are set up in areas of scattered habitations, where schools are at great distances and are a

challenge to the security of girls. This often compels girls to discontinue their education. KGBV

addresses this through setting up residential schools, in the block itself. KGVBs reach out to:

Adolescent girls who are unable to go to regular schools

Out of school girls in the 10+ age group who are unable to complete primary school

Younger girls of migratory populations in difficult areas of scattered habitations that do not

qualify for primary/upper primary schools.

2.1.2 National Programme for Education of Girls at Elementary Level

(NPEGEL)

NPEGEL is implemented in educationally backward blocks (EBB) and addresses the needs of girls

who are in as well as out of school. NPEGEL also reaches out to girls who are enrolled in school,

but do not attend school regularly.NPEGEL emphasizes the responsibility of teachers to recognize

vulnerable girls and pay special attention to bring them out of their state of vulnerability and prevent

them from dropping out. Recognizing the need for support services to help girls with responsibilities


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with regard to fuel, fodder, water, sibling care and paid and unpaid work, provisions have been made

for incentives that are decided locally based on needs, and through the provision of ECCE, as child care

for the two and three year old children. Gender sensitive teaching learning materials as also additional

subjects like selfdefence, life skills, legal rights, gender have been provided in the scheme. Efforts to

ensure a supportive and gender sensitive classroom environment through systematic sensitization and

monitoring the classroom are also built into the scheme.NPEGEL works through village level womens

and community groups to follow up girlsenrolment, attendance and achievement. The community is

engaged, in recommending village specific action based on their understanding of local issues.

2.1.3 Mid Day Meal Scheme

With a view to enhancing enrollment, retention and attendance and simultaneously improving

nutritional levels among children, the National Programme of Nutritional Support to Primary Education

(NP-NSPE) was launched as a Centrally Sponsored Scheme on 15th August 1995, in 2,408 blocks in

the country as a dry ration scheme. Over the years, this scheme has been revised many times to make it

more effective.

Objectives

The objective of the Mid Day Meal Scheme is to address two of the pressing problems for majority of

children in India, viz. hunger and education by:

Improving the nutritional status of children in classes I-VIII in Government, Local Body and

Government aided schools and EGS and AIE centres, NCLP Schools and Madarsa and Maqtabs

supported under SSA.

Encouraging poor children, belonging to disadvantaged sections, to attend school more

regularly and help them concentrate on classroom activities.

Providing nutritional support to children of elementary stage in drought-affected areas during

summer vacation.


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Rationale

Promoting school participation: Mid day meals have big effects on school participation, not just

in terms of getting more children enrolled in the registers

but also in terms of regular pupil attendance on a daily basis.

Preventing classroom hunger: Many children belonging to disadvantaged sections of the society

reach school with an empty stomach. Even children, who have a meal before they leave for

school, get hungry by the afternoon and are not able to concentrate especially children from

families, which cannot give them a lunch box or are staying a long distance away from the

school. Mid day meal can help to overcome this problem by preventing classroom hunger

amongst such children.

Facilitating the healthy growth of children: Mid day meal can also act as a regular source of

supplementary nutrition for children, and facilitate their healthy growths.

Coverage

The National Programme of Mid Day Meal in Schools (NP-MDMS) presently covers all

children studying in Classes I-VIII in Government, Government Aided and Local Body

Schools, NCLP Schools, Education Guarantee Scheme (EGS) and Alternative and

Innovative Education (AIE) centres including Madarasas and Maqtabs supported under

SSA.

2.2 Secondary Education

2.2.1 Rashtriya Madhyamik Shiksha Abhiyan (RMSA)

This scheme was launched in March 2009 with the objective to enhance access to secondary education

and improve its quality. The scheme envisages inter alia toenhance the enrolment at secondary stage by

providing a secondary school with a reasonable distance of habitation, with an aim to ensure GER of


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100% by 2017 and universal retention by 2020. The other objectives include improving quality of

education imparted at secondary level through making all secondary schools conform to prescribed

norms, removing gender, socioeconomic and disability barrier, etc.

Targets

Broad physical targets include providing facilities for estimated additional enrolment of

more than 32 lakh students by 2011-12 through;

Strengthening of about 44,000 existing secondary schools,

Opening of around 11,000 new secondary schools,

Appointment of additional teachers to improve Pupil Teacher Ratio (PTR); and

Construction of more than 80,000 additional classrooms.

Components

Important physical facilities to be provided in school include,

Additional class rooms,

Laboratories,

Libraries

Art and crafts room,

Toilet blocks,

Drinking water provisions,

Electricity/telephone/internet connectivity

Improvement in quality will be through, (i) appointment of additional teachers to reduce PTR to 30:1,

(ii) focus on Science, Math and English education, (iii) in-service training of teachers, (iv) science

laboratories, (v) ICT enabled education, (vi) curriculum reforms; and (vii) teaching learning reforms.

Equity aspects will be addressed through (i) special focus in micro planning (ii) preference to Ashram

schools in upgradation (iii) preference to areas with concentration of SC/ST/Minority for opening of


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schools (iv) special enrolment drive for the weaker section 9v) more female teachers in schools; and

(vi) separate toilet blocks for girls.

2.2.2. Scheme for Setting Up of 6000 Model Schools at Block Level

The scheme envisages providing quality education to talented rural children through setting up 6000

model schools as benchmark of excellence at block level at the rate of one school per block. The

scheme was launched in 2008-09 and is being implemented from 2009-10.

Objectives

To have at least one good quality senior secondary school in every block.

To have a pace setting role

To try out innovative curriculum and pedagogy

To be a model in infrastructure, curriculum, evaluation and school governance

2.2.3 Scheme of Construction & Running of Girls Hostel for Students of

Secondary & Higher Secondary Schools

The Centrally sponsored scheme Constuction & Running of Girls Hostel for Students

of Secondary & Higher Secondary Schools was launched in 2008-09 and is being implemented from

2009-10. The Scheme envisages construction of a hostel with the capacity of 100 girls in each of about

3,500 Educationally Backward Blocks (EBBs) in the country.

The main objective of the scheme is to improve access to and retain the girl child in secondary and

higher secondary classes (IX-XII) so that the girl students are not denied the opportunity to continue

their study due to distance to school, parents financial affordability and other connected societal

factors.

The girl students in the age group of 14-18 years studying in classes IX to XII belonging

to SC, ST, OBC, Minority Community and BPL families will form the target group of the


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Scheme.

Health and Population Stabilisation

3.1 Health Profile

The National Health Policy-2002 (NHP-2002) gives prime importance to ensure a more equitable

access to health services across the social and geographical expanse of the country. The policy outlines

the need for improvement in the health status of the people as one of the major thrust areas in the social

sector. It focuses on the need for enhanced funding and organizational restructuring of the public health

initiatives at national level in order to facilitate more equitable access to the health facilities. An

acceptable standard of good health amongst the general population of the country is sought to be

achieved by increasing access to the decentralized public health system by establishing new

infrastructure in deficient areas, and by upgrading the infrastructure in the existing institutions.

Emphasis has been given to increase the aggregate public health investment through a substantially

increased contribution by the Central Government. Priority would be given to preventive and curative

initiatives at the primary health level through increased sectoral share of allocation.

3.2 National Rural Health Mission (NRHM)

The National Rural Health Mission was launched on 12th April 2005 to provide accessible, affordable

and accountable quality health services to the poorest households in the remotest rural regions. The

detailed Framework for Implementation that facilitated a large range of interventions under NRHM

was approved by the Union Cabinet in July 2006. Under the NRHM, the difficult areas with

unsatisfactory health indicators were classified as special focus States to ensure greatest attention

where needed. The thrust of the Mission is on establishing a fully functional, communityowned,

decentralized health delivery system with inter sectoral convergence at all levels, to ensure

simultaneous action on a wide range of determinants of health like water, sanitation, education,


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nutrition, social and gender equality. Institutional integration within the fragmented health sector was

expected to provide a focus on outcomes, measured against Indian Public Health Standards for all

health facilities. From narrowly defined schemes, the NRHM is shifting the focus to a functional health

system at all levels, from the village to the district. The NRHM is about increasing public expenditure

on healthcare from the current 0.9% of the GDP to 2 to 3% of the GDP. The corollaries of such a

policy directive have not only increased central government budgetary outlay for health, but states are

also making matching increase at least 10% of the budget annually including a 15% contribution into

the NRHM plan.

a) Increasing Participation and Ownership by the Community: This is sought to be achieved through an

increased role for PRIs, the ASHA programme, the Village Health and Sanitation Committee, increased

public participation in Hospital Development Committees, District Health Societies in the district and

village health planning efforts and by a special community monitoring initiative and also through a

greater space for NGO participation.

b) Improved Management Capacity: The core of this is professionalising management by building up

management and public health skills in the existing workforce, supplemented by inculcation of skilled

management personnel into the system.

c) Flexible Financing: The central strategy of this pillar is the provision of untied funds to every

Village Health and Sanitation Committee, to the sub-center, to the PHC, to the CHC including District

Hospital.

3.3 National Urban Health Mission (NUHM)

The proposed National Urban Health Mission (NUHM) aims to address the public health care needs of

urban population. Addressing the needs of public health care services for urban population would

involve revamping/ creation/upgradation of primary, secondary and tertiary health care service delivery

system in urban areas. This will be done by investing in health professionals, appropriate technology,


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creating new & upgradation and utilization of existing infrastructure and strengthening the extant

health care service delivery system. Recognizing the seriousness of the problem, urban health has

beentaken up as a thrust area for the 12th Five Year Plan. NUHM will be launched for urban

population with focus on slums and other urban poor.

Need based city specific urban health care system to meet the diverse health needs of the urban

population with focus on urban poor and other vulnerable sections.

Partnership with community for a more proactive involvement in planning, implementation and

monitoring of health activities.

Institutional mechanism and management systems to meet the health-related challenges of a

rapidly growing urban population.

Framework for partnerships with NGOs, charitable hospitals and other stakeholders.

3.4 Maternal Health

Promotion of maternal and child health has been one of the most important objectives of the Family

Welfare Programme in India. Under the NRHM (2005-2012) and the RCH Programme Phase-II (2005-

10) the Government of India is actively pursuing the goals of reduction in Maternal Mortality by

focusing on the 4 major strategies of essential obstetric and new born care for all, skilled attendance at

every birth, emergency obstetric care for those having complications and referral services. The other

major interventions are provision of Safe Abortion Services and services for RTIs and STIs. This

policy recommends a holistic strategy for bringing about total inter-sectoral coordination at the grass

root level and involving the NGOs, Civil Societies, Panchayati Raj Institutions and Womens Group in

bringing down Maternal Mortality Ratio and Infant Mortality Rate.


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FINDINGS,RECOMMENDATIONS AND

CONCLUSIONS

Regional Economic Co-operation is increasingly being viewed as a vehiclefor expediting the process of

economic development not because of the problemsin global market access and the higher transaction

costs of producing for the worldmarket. It is widely believed that the expansion of trade on a regional

level yieldsgains in production specialization, efficiency and improved quality of exports, allof which

benefit the countries participating in the regional co-operation initiatives.In view of these

considerations, there has been a growing interest in promotingintra-regional trade in South Asia as

well. Against this backdrop, the objective of

this study has been to examine the pattern of trade in the region with a view toascertaining whether or

not the regional trading arrangements such as SAPTA andSAFTA can be instrumental in promoting

intra-regional trade.

FINDINGS:

The present study carried out to evaluate the impact of SAPTA on India's foreign trade relationship

with SAARC countries is presented in VII chapters. The problem under investigation is introduced in

Chapter - I. The objectives of the study and the framework are also stated in the first chapter. The

chapter is presented in three parts viz., the first part consists of all those studies, which examines the

association between trade and development/economic growth. It also deals with the studies those

connected with the estimation of export and import functions in particular. In the Second and Third part

some of the studies, which are connected with the intra-SAARC trade and SAPTA are reviewed

respectively.


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There is a need for deeper and strategic trade liberalization to foster intraregional trade. The region

should adopt sectoral approach as the basis for trade liberalization. The liberalization process can be

made in phases. In the first phasebroad product groups like textile, chemicals, vegetable products and

machineryand mechanical appliances may be considered for trade liberalization. The otherimportant

product groups may be chosen in subsequent phases.

It needs to be emphasized, first, that the impediments such as limited capacity, especially of small

South Asian economies, to generate exportable surpluses, restrictive trade policies, and political

problems have inhibited thegrowth of intra-regional trade in South Asia. Second, although various

economicand political factors have contributed to a low level of intra-regional trade inSouth Asia, there

exists potential for economic co-operation in some areas. For example,

Economic ties in the region could be strengthened through measures aimed at broadening the

composition of intra-regional trade with a major focus on trade of intra-industry, achieving vertical

specialization, joint export marketing of competing regional export products, deepening trade

liberalization under SAPTA, promoting monetary co-operation, and encouraging joint industrial

ventures. It must, however, be pointed out that efforts to promote regional economic cooperation are

unlikely to succeed without political harmony and convergence in economic perceptions, which are

essential pre-requisites for forging an economic and trade alliance in the South Asian region.

RECOMMENDATIONS:


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The South Asian countries have been bleeding themselves by buying from countries outside the

South-Asian region numerous goods and services at an exorbitant cost merely because they wanted to

turn their faces away from the neigh bors. Now, they will not only buy many of those high-cost imports

from the neigh bors at low transport and other costs, but will also face lower tax in their trading

exercises. This, no doubt, will reduce their costs of production at home as all the imported components

that go into their own manufactures will be bought more cheaply from the neigh bors. In that case,

cheapness apart, the scales of production will get a boost and the economies of scale in domestic

production will bring yet

another significant improvement. It is obvious that when trade at low cost and larger scales begins to

flow and greater confidence is built up, many other arrangements on the financial fronts on the credit

availability, further expansion of the list of traded commodities, further tariff concessions and further

give and take, will follow. On the basis of the wide-ranging discussions held with the entrepreneurs,

officials of the governments and academics during field visits, and the information gathered from the

publications of the government and the chambers of commerce and industry, It is observed that

significant opportunities exists for expanding intraregional trade since many SAARC countries are

importing goods from outside the region even while the same goods are available within the region and

are in fact

being exported by the member countries to tho

gauri_eco_project.odt

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