The Gist May - June 2013

Contents
GIST OF THE HINDU ......................................................................................................... 2

Hypertension Major Contributor to Avoidable Deaths in India: WHO........................................................................................ 2
No Capital Gains Tax for NIMZs ........................................................................................................................................................ 2
Vienna Meet Sees Divisions on Indias Entry into NSG .................................................................................................................. 3
The P-5 Club ........................................................................................................................................................................................... 4
Antarctica Concerns Grow as Tourism Numbers Rise ...................................................................................................................... 5
Abel Prize for Belgian Pierre Deligne ................................................................................................................................................. 6
Universal, Rights-based Goals ............................................................................................................................................................... 7
Promoting Gender Equality and Womens Eights ............................................................................................................................ 7
India up in Arms against Imbalance in ATT Draft ......................................................................................................................... 8
BRICS and Mortar for Indias Global Role ......................................................................................................................................... 8
ISRO Plans a New High-resolution Earth Satellite ........................................................................................................................... 9
UNDP Brackets India with Equatorial Guinea in Human Development Index ........................................................................ 10
Police Reforms Gender Equality ....................................................................................................................................................... 11
Black Carbon from South Asia Melting Tibetan Glaciers ............................................................................................................. 15
Nuclear Cooperation, Key to Multiple Projects: Kazakhstan .................................................................................................... 15
GIST OF YOJANA............................................................................................................. 17
Budget ProposalsAs Overview ........................................................................................................................................................ 17
Growth in GDP at Factor Cost at 20045 Prices (Percent) ........................................................................................................ 20
Budget 201314 and Beyond: What it Means for Fiscal Consolidation? ................................................................................. 24
Budget: Concepts and Terminologies ............................................................................................................................................... 26
A Power Sector Review of Budget .................................................................................................................................................... 28
Agriculture and Budget ........................................................................................................................................................................ 30
Procedures for Foreign Portfolio Investors Simplified ................................................................................................................ 32
Social Sector OutlaysAs Assessment .............................................................................................................................................. 35
Indias Defence Budjet ........................................................................................................................................................................ 39
Land Use and Agrarain Relations ...................................................................................................................................................... 42
Land Management can Improve Rural Economy ......................................................................................................................... 42
KURUKSHETRA................................................................................................................ 43
Poverty in India ................................................................................................................................................................................... 43
Strategy to Develop Degraded Land ................................................................................................................................................ 44
Land Acqusition in India Need for a Paradigm Shift ..................................................................................................................... 45
Global Hunger Index, 2012 ............................................................................................................................................................... 48
Panel on Climate Change .................................................................................................................................................................. 48
PRESS INFORMATION BUREAU .................................................................................. 49
Human Development Index ............................................................................................................................................................. 49
Millennium Development Goals ...................................................................................................................................................... 49
Planning Commission Hosting Google Hangout ............................................................................................................................ 50
5th BRICS Summit - eThekwini Declaration and Action Plan ................................................................................................... 51
SCIENCE REPORTER ...................................................................................................... 58
100th Indian Science Congress at Kolkata ..................................................................................................................................... 59
Recommendations of the Congress .................................................................................................................................................. 59
Plants Behave a Lot Like Humans! ................................................................................................................................................. 60
COURTESY:
The Hindu
Yojana
Kurukshetra
Press Information Bureau
Science Reporter
Gist of The Hindu 2
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Gist of
THE HINDU
HYPERTENSION MAJOR CONTRIBUTOR TO
AVOIDABLE DEATHS IN INDIA: WHO
The World Health Organisation (WHO) is
finalising a set of nine voluntary global
targets that will help in reducing non-
communicable diseases (NCDs), particularly
hypertension which is a major contributor
to cardio-vascular diseases.
The voluntary targets being discussed are
reduction in premature mortality from NCDs
by 25 per cent by 2020 by reducing intake
of alcohol and physical inactivity by 10 per
cent each and intake of salt/sodium by 30
per cent. This will reduce high blood
pressure incidence by 25 per cent.
Use of tobacco is targeted to be brought
down by 30 per cent in addition to improving
medicines, technology and counselling.
Hypertension is a major contributor to
avoidable death and disease in India, too,
with an increasing impact in the rural areas.
Over 140 million people are believed to be
suffering from high blood pressure in the
country and the number is expected to cross
the 214 million mark in 2030. Hypertension is
a major risk factor for cardio-vascular
diseases that killed 2.7 million people in 2004
and will result in the death of over 4 million
people by 2030.
NO CAPITAL GAINS TAX FOR NIMZS
The Central Government, came out with sops
for setting up of National Investment and
Manufacturing Zones (NIMZs) doling out
various benefits, including exemption from
capital gains tax and eligibility for viability
gap funding.
According to the document notified by the
Department of Industrial Policy and
Promotion (DIPP), the units in the NIMZs
will be exempted from capital gains tax on
sale of plant and machinery.
The tax break will be granted in case of re-
investment of sale consideration within three
years for purchase of new plant and
machinery in any other unit located in the
same NIMZ or another NIMZ.
NIMZs will now be eligible for Viability Gap
Funding, which cannot exceed 20 per cent
of the project cost. As per the norms,
developers of NIMZs will be allowed to raise
funds through external commercial
borrowings (ECBs) for developing the
internal infrastructure. Soft loans from
multilateral institutions will be explored for
funding infrastructure development in
NIMZ.
Similarly, assistance would be provided for
negotiating non-sovereign multilateral loans
by providing back-to-back support, if
necessary. On the issue of labour policy,
the government will put in place a job loss
scheme to enable units to pay suitable
compensation, in the eventuality of
closures, through insurance.
The compensation under this instrument
would be equivalent to 20 days average pay
for every completed year of continuous
service, or any part thereof in excess of six
months, it said.
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The government has proposed to set up 11
NIMZs to enhance the share of
manufacturing in gross domestic product
(GDP) to 25 per cent within a decade and
creating 100 million jobs. Welcoming the new
norms, Federation of Indian Chambers of
Commerce and Industry (FICCI) said these
guidelines provided a clarity and direction
to investors on how the NIMZs needed to
be developed.
VIENNA MEET SEES
DIVISIONS ON INDIAS ENTRY INTO NSG
The United States and three other big powers
this week argued for allowing nuclear-armed
India into an atomic export control group,
but China and several European states
appeared doubtful about the move,
diplomats said.
The divisions were in evidence during
closed-door talks of the 46-nation Nuclear
Suppliers Group on whether India could join
and become the NSGs only member outside
the Non-Proliferation Treaty (NPT), they
said.
The U.S., France, Britain and Russia were
among those which backed India Asias
third largest economy while smaller
European states such as Ireland, the
Netherlands and Switzerland had
reservations.
China stressed need for equal treatment in
South Asia, an apparent reference to its ally
Pakistan, which is also outside the NPT and
has also tested atomic bombs.
The NSG which includes the U.S., Russia,
China, European Union countries and some
others is a cartel that tries to ensure that
civilian nuclear exports are not diverted for
military purposes.
India and Pakistan, which have fought three
wars, have both refused to sign the 189-
nation NPT, which would oblige them to scrap
nuclear weapons.
Close relations between China and Pakistan
reflect a long-standing shared wariness of
their common neighbour, India, and a desire
to counter U.S. influence across the region.
IRANIAN NUCLEAR PROGRAMME &
WESTERN CONCERN
Iran and the P5+1 group of world powers in
Almaty are the first to indicate the emergence
of a possible way out of the stalemate over
the Islamic Republics nuclear programme.
In the talks, the P5+1 dropped three earlier
demands: that Iran stop enriching uranium
to a 20 per cent concentration of the U-235
isotope, that it close down its heavily
fortified Fordow enrichment plant, and that
it send its stockpile of enriched fuel abroad.
The United States now issues blanket
waivers for countries which buy Iranian oil.
Secondly, the EU General Court has ruled
EU sanctions on two major Iranian banks
unlawful. And yet, sanctions have hit Irans
economy and its people hard: the rial has
fallen 40 per cent in the past year, and
unemployment is rising.
American and European bans have also
intimidated many countries and private
companies into suspending Iranian links. So
anything which helps reverse the sanctions
tide ought to be welcomed by Tehran.
The latest P5+1 offer is proof that the hard-
line positions the U.S. has taken on the
Iranian nuclear issue in the past have been
counterproductive.
Two years ago, the Obama administration
scuttled a Turkish-Brazilian proposal that
would have involved Iran shipping a major
chunk of its 3.5 per cent enriched uranium
stockpile to Turkey in exchange for enough
20 per cent uranium to produce medical
isotopes at the Tehran Research Reactor.
By killing that deal, the U.S. merely ensured
that the Iranians went ahead and produced
the 20 per cent uranium themselves.
It was to sidestep this sort of outcome that
the former head of the International Atomic
Energy Agency, Mohammed el-Baradei, had
first floated the idea of a freeze in sanctions
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on Iran in exchange for a freeze in enrichment.
The Almaty offer suggests the U.S. has
finally understood that this is the only way
to move forward.
THE P-5 CLUB
The exclusive P-5 (Permanent Five) club.
Theirs is an entrenched reluctance to share
the high table with others and, from their
perspective, understandably so.
Presently, at least two of them would be hard
put to justify their privileged position.
Frequently, the P-5 mouth platitudes to
please the aspirants, even whilst their
negotiators at the United Nations do
whatever it takes to hold back progress.
Second, the UfC or the Coffee Club countries
which at best total 10-11, including our
neighbour on the west, along with Italy and
a few others. Secure in the knowledge that
they would never make it to the expanded
setting, they work overtime to create fissures
and stall forward movement to keep the
house divided.
Need for s128 Votes
For Security Council reform to take place, a
minimum of 128 votes will be required in the General
Assembly on a resolution calling for expansion in
both the categories. In a subsequent phase,
individual countries would have to demonstrate
their ability to garner 128 votes for their
candidatures. Ratification by legislatures of
member states would then make possible the
Charter amendment.
Why is the present juncture a make or break
scenario?
Celestial Fireball
The 2012 DA14 asteroid tracked in advance
did not harm us; it skimmed past nearly
27,600 km from the Earth on February 15.
But the same day, a meteor, unconnected with
2012 DA14, came out of the blue and exploded
over Chelyabinsk, Russia at 9.25 am local time
injuring more than a thousand people. It has
many firsts to its credit.
The 55-foot meteor weighed about 10,000
tonnes before it entered Earths atmosphere.
It is the largest known celestial object to
strike Earth more than a century after the one
that came crashing down over the Tunguska
River in Siberia in 1908.
The Chelyabinsk meteor had a speed of only
18 km per second, far less than the April 22,
2012 Sutters Mill record speed of 28.6 km
per second. Once the Russian meteor
entered the atmosphere, a combination of
pressure and heat caused it to break apart
19-24 kilometres above the earth producing
a fireball that blazed across the sky.
According to the Russian Geographic
Society, the bright flare was more than 2,500
degree C.
The disintegration took place 32.5 seconds
after it entered the atmosphere, and released
an estimated energy of nearly 500 kilotons,
NASA notes.
The shockwaves caused by the explosion
shattered glass and damaged many
buildings. The infrasound produced by the
meteor was the strongest ever detected by
the Comprehensive Test Ban Treaty
Organisation (CTBT) sensors.
CITES Convention
The Convention on International Trade in
Endangered Species (CITES), the only treaty
that regulates international trade in wildlife,
has banned any trade in tiger parts, either
domestically or internationally.
The trade, so far, thus has been understood
as illegal. But here is the shocker: a new
investigation in China by the United
Kingdom-basedEnvironmental Investigation
Agency (EIA) has found that domestic trade
in China in tiger parts, for skins and tiger
wine, is allowed, nurtured, and legalised .
CITES has begun its 16th Conference of
Parties (CoP16) in Bangkok, Thailand
(March 3-14).
The issue of stockpiles and their sale will
come up again, but these international
negotiations, while otherwise useful, will be
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far from adequate to secure our wildlife. As
long as stockpiles exist, the only way for
India to save its elephants, tigers (and other
widely poached animals) is to enforce
domestic protection.
CITES classifies species under different
Appendices, consequent to international
threats from poaching and rarity of the
species.
Elephants, both Asian and African, are on
Appendix 1, with a ban on trade in ivory.
Several African states allow trophy hunting
and management-based culling quotas for
shooting elephants.
There are thus tonnes of ivory in stockpiles
in several African countries. Consequently,
several countries demand licences for the
legal sale of elephant ivory.
In 2007, CITES allowed a one-off sale of ivory
in government-held stockpiles for Botswana,
South Africa and Namibia. At CoP16, CITES
will discuss the workings of a decision-
making mechanism for further sale of ivory.
This will remain a pulsating threat to wild
elephants in India and African countries.
Consider the numbers: a new study shows
that 11,000 elephants have been poached in
Gabon since 2004; this year, poachers in
Kenya killed a family of 11 elephants. Last
year, in what is perhaps a newly documented
trend, poachers shot down thousands of
elephants, using machine guns fired from
Ugandan helicopters, in Congo (and perhaps
in other countries as well). In India, the forest
department works hard to ensure the safety
of elephants, and the threat of poachers, who
are adaptive in the killing of several
lucrative species as well as enforcers who
get in the way, is always a real one.
Given the global scenario, at this CITES
meeting, India will find itself sandwiched
between demand and supply forces: both
legal, and illegal in the garb of legal. This
outlines with even more urgency the need to
keep our own forests safe, and not depend
on transnational regimes to save our species.
ANTARCTICA CONCERNS GROW AS
TOURISM NUMBERS RISE
In a remote, frozen, almost pristine land where
the only human residents are involved in research,
that tourism comes with risks, for both the continent
and the tourists. Boats pollute water and air, and
create the potential for more devastating
environmental damage. When something goes
wrong, help can be an exceptionally long way off.
The downturn triggered by the economic meltdown
created an opportunity for the 50 countries that share
responsibility through the Antarctic Treaty to set
rules to manage tourism, but little has been done. An
international committee on Antarctica has produced
just two mandatory rules since it was formed, and
neither of those is yet in force. Its not just the
numbers of tourists but the activities that are
changing.
A major worry is that a large cruise ship
carrying thousands of passengers will run into
trouble in these ice-clogged, storm-prone and poorly
charted waters, creating an environmentally
disastrous oil spill and a humanitarian crisis for the
sparsely resourced Antarctic research stations and
distant nations to respond to. The United States has
been criticised on environmental grounds for building
a 1,600-kilometre (995-mile) ice road from McMurdo
Station to the South Pole on which tractors drag fuel
and supplies on sleds. The road provides a more
reliable alternative to frequently grounded air
services.
A Trial Drug Raises hope to Eradicate
Malaria
A candidate drug (ELQ-300) was found
capable of treating and preventing malaria
infection, and even blocking transmission
during a trial on mice.
While the currently available drugs target
the parasite at the blood stage of infection,
the candidate drug was able to target both
the liver and blood stages.
Going beyond destroying the parasite in the
body, the drug (quinolone-3-diaryether) was
found to be effective in preventing infection
by attacking the parasite forms that are
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crucial to disease transmission (gametocytes,
and the vector stages zygote, ookinete
and oocyst).
Any drug that does even half of what ELQ-
300 is capable of will be a boon nearly 200
million people in the world suffer from malaria
every year, and the mortality is as high as 1.2
million. To make matters worse, resistance to
currently available drugs is emerging.
Two candidate drugs ELQ-300 and P4Q-
391 were tested against both Plasmodium
f a l c i p a r u m a n d P l a s m o d i u m
vivax species . Isolates of P.
falciparum and P. vivax taken from patients
infected with malaria in southern Papua,
Indonesia were tested using both the drug
candidates. ELQ-300 was found to be
superior against both drug-resistant species.
ABEL PRIZE FOR BELGIAN PIERRE DELIGNE
Belgian mathematician Pierre Deligne, who is
regarded as one of the most celebrated
mathematicians of the 20th century, has been chosen
for this years prestigious Abel Prize in Mathematics.
The 69-year-old professor emeritus of the Institute of
Advanced Study, Princeton, is being awarded for his
seminal contributions to algebraic geometry and for
their transformative impact on number theory,
representation theory and related fields.
SUBMARINE VARIANT OF
BRAHMOS TEST-FIRED
The maiden flight of the submarine variant
of the Indo-Russian supersonic cruise
missile, BrahMos, was successful when it
was test-fired from a pontoon off
Visakhapatnam in the Bay of Bengal.
It marked a global first in the vertical launch
of a supersonic cruise missile from an
underwater platform.
The anti-ship version of the potent missile,
with a range of 290 km, blasted off from the
pontoon.
The capability has been proven and the
missile is ready for fitment on the Navys
future submarines under Project 75-I,.
Oslo Summit Asks: Is Melting Arctic Sea
Ice a boon or a bane?
With India applying for observer status on
the intergovernmental Arctic Council, along
with China and other countries, the melting
sea ice and its consequences, mainly in terms
of opportunities for exploration of natural
resources in the Arctic region, is a crucial
debate.
At the first Arctic Summit organised by The
Economist in Oslo on Tuesday, though India
was not represented, climate change issues
figured as much as the regions undiscovered
natural resources, which many countries and
oil companies are eyeing.
While India set up a research station in the
Arctic in the 2008, and is keen on a say in the
area, its neighbour is far ahead of it.A
Chinese icebreaker made a three-month
journey in the Arctic Ocean last year, thus
becoming the first Asian ship to navigate
through the treacherous waters.
Putting Bharat on an
Equal Footing with India
Mr. David Cameron is co-chair, along with
Indonesian President Susilo Bambang
Yudhoyono and Liberian President Ellen
Johnson Sirleaf, of a 27-member High Level
Panel of Eminent Persons (HLP) to make
recommendations regarding the vision and
shape of a post-2015 development agenda.
The Panel was set up by United Nations
Secretary-General Ban Ki-moon and has met
three times till now.
The inter-governmental process of
negotiating and adopting new goals will start
with the U.N. General Assembly in September
2013 and will conclude by 2015.
India, home to a large segment of humanity
and quite far from meeting the present
Millennium Development Goals (MDGs), will
have a key role to play in the agreement over
a relevant development framework for post-
2015.
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UNIVERSAL, RIGHTS-BASED GOALS
A universal set of goals based on principles of
human rights should be applicable to all countries.
The world is no longer divided into north-south, or
east-west. The world order has moved from a G7
world to a G20 world, with the poor living largely in
middle-income rather than low-income countries and
with aid no longer being the main way out of poverty.
In such a world, we cannot have one set of
goals for the developing world and another one for
the developed world, whose only responsibility in
the old world order was to provide aid. We need to
ensure that we live in a more equal and sustainable
world, adopting principles of equity and common
good but with differentiated responsibilities to attain
that.
Tackling Social Exclusion
Eradication of extreme poverty would mean
focusing on the one-third of worlds people with
daily income below $1.25 who live in India. However,
we need sharper focus on the bottom 20 per cent of
the population and at the root causes of poverty and
inequality. In India, and elsewhere, this group would
consist of groups socially excluded because of
discrimination on the basis of caste, religion, ethnicity,
or gender. This needs to be tackled at the policy level,
rather than just focusing on secular economic growth
as the sole means to eliminate poverty.
Combating Inequality
We also need to look at inequality and the
relationship between the rich and the poor say the
ratio between the income and wealth of the top 20 per
cent and the bottom 20 per cent of the population.
This would focus attention on correcting and
adjusting the pattern of development during the last
decade that has led to widening inequalities
worldwide, with the rich enjoying a disproportionate
share of the gains from development, and very slow
progress in poverty reduction.
PROMOTING GENDER
EQUALITY AND WOMENS EIGHTS
We need much stronger emphasis on gender
equality compared to the last round of MDGs. A
strong goal building on the commitments already
made under the Beijing Platform in 1995 and the
Convention on the Elimination of All Forms of
Discrimination Against Women (Cedaw) ensuring
womens economic, social and political rights is
essential. This could be translated into targets on
equal ownership of property, including land, a
violence-free life, and equitable representation in law-
making bodies.
Combining Inclusiveness and
Sustainability
The Rio+20 Conference in June 2012
established an Open Working Group of 30 members
to propose sustainable development goals (SDGs)
for presentation to the U.N. General Assembly. The
new MDGs and the SDGs need to be combined into
one set of goals that have both inclusiveness and
sustainability.
Introducing Monitoring and
Accountability
The current MDGs have no monitoring
mechanism, eliminating accountability. Once the new
goals are adopted, each country needs to set up a
tripartite mechanism including the government,
civil society, and the private sector to monitor
progress in the attainment of the new MDGs.
Giant Leap in the Theory of Universe
The European Space Agency (ESA) unveiled
the most detailed map yet of relic radiation
from the Big Bang, revealing data it hopes
will shed light on the creation and expansion
of our Universe.
The 50-million pixels, all-sky image of the
oldest light adds an edge of precision to some
existing theories, defining more precisely the
composition of the Universe and its age
about 80 million years older than previously
thought.
The map is composed of data gathered by
ESAs Planck satellite, launched in May 2009
to study Cosmic Microwave Background
the remains of ancient radiation emitted as
the Universe started cooling after the Big
Bang.
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INDIA UP IN ARMS AGAINST
IMBALANCE IN ATT DRAFT
India may ask western countries to look for
new customers for their defence equipment
as it feels they were instrumental in loading
the Arms Trade Treaty (ATT) against
importers. The Treaty will come up for voting
at the U.N. on April 2.
India feels let down by the West but
welcomed assurances by France and Russia
of keeping the ATT out in all future defence
contracts.
As the largest arms importer in the world,
India is concerned about the imbalance in
the ATTs final draft. While it allows
exporters to unilaterally cancel contracts, a
provision to safeguard the interests of
importers was quietly dropped.
India has not endorsed the treaty text. The
government will take a position after a
thorough review. The value of a treaty that
does not ensure universal adherence would
be obviously questionable, warned the
sources, fearing that the decision to ram
through the ATT by a vote would mean it
will go the same way as the Oslo Accord on
cluster munitions did.
The ATT aims at regulating $ 70 billion worth
of annual trade in arms. It is expected to be a
more effective instrument than the voluntary
U.N. register for conventional arms.
The third area where Indian views and the
text of the final draft do not coincide is the
exclusion of gifts and loans from the purview
of the Treaty. Sources said this was because
of a deal cut between China and the European
Union early on in the negotiations.
BRICS AND
MORTAR FOR INDIAS GLOBAL ROLE
India is at a unique geopolitical moment. On
the one hand its neighbourhood and the
larger Asian continent are being
unpredictably redefined.
India and China are charting new
geographies of contests, the Indian Ocean
and South China Sea. The Arab Spring has
exposed the fundamental inadequacies in
Middle Eastern and North African governing
structures but has also given rise to an
uncertain political future in an important
energy-producing region. Last, but certainly
not least, Chinas growing assertiveness in
the Asia-Pacific region has led to increased,
if sometimes seemingly unnecessary, conflict
with neighbours in Southeast Asia and Japan.
On the other hand, the world is seeing a once-
in-a-century churn. The global board of
directors that sit on the high table and define
rules for conduct of political and economic
governance are now unrecognisable from the
lot just after World War II.
India must seize the moment to shape these
revisions of rules devised by the Atlantic
countries and defend its growth and
development interests in areas such as trade,
Intellectual Property Rights (IPR), space,
climate, and energy policy, among others.
Regional order and global governance are
both in flux and demanding Indias attention.
This is not unique by itself. What is different
this time around is that India has the capacity,
increased capabilities and enhanced level of
demonstrated intent to engage with this dual
external relations challenge. In order to attain
the global power status it desires, India must
walk and chew gum at the same time. It must
tend to its immediate and extended Asian
neighbourhood while also engaging with the
task of shaping a new rules-based political
and economic order. BRICS represents a
uniquely appropriate platform and flexible
mechanism with which India can address this
dual imperative.
Engaging with China and Russia in an
environment free of the sharp edges often wrought
in bilateral negotiations will catalyse congruence over
an array of mutually important issues. Any stable
Asian order must have at its core, a certain level of
accord among these three large continental powers.
The past would need to be defrayed and the path for
future integration would need to sidestep suspicion
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and history. Annual BRICS summit-level discussions
on political and economic matters allow the three
countries such an arena of tactical camaraderie. The
current moment allows a unique opportunity for the
three to shape a new construct for Asia amidst the
regional flux. Perhaps at some stage it may be
worthwhile having a summit level RIC meeting on the
sidelines of BRICS to discuss this Asian project.
On resetting and reshaping economic and
political governance, BRICS has the potential to be
the new (and often criticised) game changer. The
sheer size and rate of growth of intra-BRICS trade and
economic exchange will allow each of these countries
to exert their collective weight for their individual
gains. Who gains more should not matter, as long as
every member benefits from this dispensation and the
order is visibly equitable.
There are a few benefits that India must seek
through and with the BRICS. First, there are many
multilateral organisations within which a BRICS-
bloc can exert significant leverage. The U.N. and
World Trade Organization are two such forums. While
geopolitical and economic thinking among BRICS is
not always in-sync, where there is consensus (and
the areas are increasing rapidly) BRICS could be a
compelling voice. Like they did on the debates on
non-interference and Responsibility to Protect.
Similarly, Indias views on climate change, financial
norms, trade rules and so on could also benefit from
BRICSs aggregate voice. Of course the UNSC
membership issue strikes a discordant note but it
should not cannibalise the possible coming together
on other matters.
ISRO PLANS A
NEW HIGH-RESOLUTION EARTH SATELLITE
The Indian Space Research Organisation is
to build a remote sensing satellite, Cartosat-
3, capable of taking images of the earth with
a resolution of 0.25 metres.
Currently, GeoEye-1 produces the highest
resolution earth images taken by a
commercial satellite. The American
spacecraft, launched in September 2008, is
capable of taking panchromatic images with
0.41 metre resolution. WorldView-2, another
satellite operated by the same company,
Digital Globe, offers a best resolution of 0.46
metres. However, in accordance with U.S.
regulations, commercially released images
from these satellites are degraded to 0.5 metre
resolution.
Digital Globe plans to launch WorldView-3
next year, which will supply images with a
resolution of 0.31 metres. Cartosat-3s camera
would better that performance. In the words
of one expert, this satellites images could
allow a scooter to be distinguished from a
car.
In 1988, ISRO launched Indias first
operational remote-sensing satellite, IRS-1A.
The best resolution its cameras could
provide was about 36 metres. Seven years
later, IRS-1C went into space, with a
panchromatic camera that had a resolution
of 5.8 metres. It supplied the highest
resolution images available from any civilian
satellite in the world till Ikonos, an American
satellite launched in 1999, began taking
images with better than one-metre resolution.
India launched the Technology Experiment
Satellite in 2001, followed some years later
by the Cartosat-2 series of satellites that
could take images with 0.8 metre resolution.
GIVING PANTHERA TIGRIS A CHANCE
India was once the only home to the worlds
big four cats the lion, tiger, cheetah and
leopard. It also played host to over 13 per
cent of global avian species, an impressive
number of mammalians and an enviable
presence of Lepidopterans (a large order of
insects that includes moths and butterflies).
However, once the Mughals, the British
bureaucracy and Indias feudal aristocracy
established the hunting of animals to be the
ultimate symbol of manhood and nobility, it
was only a matter of time before several
species became extinct.
The earliest recorded extinction was that of
the Himalayan Mountain Quail in 1876,
followed by the cheetah, when the Rajah of
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Korwai in northern Madhya Pradesh shot
the last three (a mother and her two cubs) on
November 24, 1947. Today, according to the
International Union for Conservation of
Nature, nearly 84 bird species are endangered
while among mammals, the tiger is teetering
on the brink of extinction.
The common Indian is least concerned
whether the tiger survives or perishes. Nor
does he care about the consequences of
global warming or the diminishing green gene
pool and biodiversity, which are the key to
human survival.
India boasts of being home to about 70 per
cent of surviving tigers in the world, do I
have a feasible plan of action for the species
assured survival?
(a) through an ordinance, place all tiger
reserves and contiguous sanctuaries
and protected/notified forests in the
country, together with all their current
administrative assets and liabilities,
under the existing National Tiger
Conservation Authority (NTCA) for a
decade. Offset the loss of revenue to
States arising from this ordinance for
the period of its operation, through
special budgetary allocations.
(b) concurrently, bring the NTCA under the
Prime Ministers Office.
(c) hold an annual tiger revival audit by
an independent body of three to five
experts, drawn from within and outside
the country. Induct 30 per cent new
members to the audit team each year
and retire an equal number from the
previous team.
(d) the Prime Minister must take the annual
audit findings as fresh inputs, for
mandatory implementation and to keep
Parliament informed.
(e) place a moratorium on de-notifications
and or alteration of boundaries of
existing national parks, tiger reserves,
wildlife sanctuaries and notified forests
both by Parliament and by State
legislatures, through the same
ordinance.
(f) enact stringent legislation to deal with
poaching
(g) create a save the tiger caucus (in the
phraseology and practice of the U.S.
Capitol Hill) in both Houses of
Parliament and State Legislatures, to
regularly monitor results and progress
on recommendations of the revival audit
and insist on midcourse correction
when circumstances so demand.
Emperor Ashoka chose the Asiatic Lion as
the symbol of Indias nationhood. Twenty-
two centuries later, the Democratic Republic
of India placed the Royal Bengal Tiger on a
similar pedestal as the national animal. Let
us arise to save both.
Let all Indians be fired up by the optimism of
Dame Jane Goodall, the British primatologist,
ethologist, anthropologist, and U.N.
Messenger of Peace, who, when asked by
an interviewer in September 2009 if she
believed there was hope for animals and
their world, said: At one time (the 1980s)
there were just 12 Californian Condors [the
largest North American land bird and on the
verge of extinction] in the wild and one in
captivity.
UNDP BRACKETS INDIA WITH EQUATORIAL
GUINEA IN HUMAN DEVELOPMENT INDEX
India has been ranked 136 among 187
countries evaluated for human development
index (HDI) a measure for assessing
progress in life expectancy, access to
knowledge and a decent standard of living
or gross national income per capita.
The Human Development Report of the
United Nations Development Programme
(UNDP) for 2013, released, puts Indias HDI
value for the last year at 0.554, placing it in
the medium human development category,
which it shares with Equatorial Guinea.
On the positive side, Indias HDI value went
up from 0.345 to 0.554 between 1980 and 2012,
an increase of 61 per cent or an average
annual increase of 1.5 per cent.
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Interestingly, the report notes that social
movements and the specific issues media
highlight do not always result in political
transformations benefiting the broader
society.
There is a word of appreciation for India for its
policies on internal conflicts. India has shown that
while policing may be more effective in curbing
violence in the short term, redistribution and overall
development are better strategies to prevent and
contain civil unrest in the medium term, the report
says, referring to Operation Green Hunt launched
against Maoists, which has come under sharp
criticism from human rights activists within the
country. The other initiatives that have been lauded
are the right to education and the rural employment
guarantee scheme that provides up to 100 days of
unskilled manual labour to eligible poor at a
statutory minimum wage. This initiative [the job
guarantee scheme] is promising because it provides
access to income and some insurance for the poor
against the vagaries of seasonal work and affords
individual the self-respect and empowerment
associated with work.
Despite Indias progress, its HDI of 0.554 is
below the average of 0.64 for countries in the medium
human development group, and of 0.558 for countries
in South Asia. From South Asia, countries which are
close to Indias HDI rank and population size are
Bangladesh and Pakistan with HDIs ranked 146 each.
But the report points out that the ranking masks
inequality in the distribution of human development
across the population.
Even on the Gender Inequality Index
inequalities in reproductive health, empowerment and
economic activity India has been ranked 132nd
among the 148 countries for which data is available.
In India, only 10.9 per cent of the parliamentary seats
are held by women, and 26.6 per cent of adult women
have reached a secondary or higher level of
education, compared with 50.4 per cent of their male
counterparts. For every 100,000 live births, 200
women die of causes related to pregnancy, and female
participation in the labour market is 29 per cent,
compared with 80.7 per cent for men.
As for the Multidimensional Poverty Index
(MPI), which identifies multiple deprivations in the
same household in education, health and living
standard, Indias value averages out at 0.283, a little
above Bangladeshs and Pakistans. The figures for
evaluating MPI have been drawn from the 2005-06
survey, according to which 53.7 per cent of the
population lived in multidimensional poverty, while
an additional 16.4 per cent were vulnerable to multiple
deprivations.
POLICE REFORMS GENDER EQUALITY
Behind the rot is the Police Act of 1861
legislated by the British after the Indian
Mutiny of 1857 to impose a police force upon
their subjects, which could be used solely to
consolidate and perpetuate their rule, says
Mr. Singh.
It has been over a century since the need for
reforms was initially felt. The first Indian
Police Commission of 1902-03 found that the
police force throughout the country is in a
most unsatisfactory condition; that abuses
are common everywhere; that this involves
great injury to the people and discredit to
the government; and that radical reforms are
urgently necessary.
Several commissions and committees have
strongly recommended major changes but
the political executive continues to retain its
stranglehold on the police. Every successive
government finds it convenient to use,
misuse and abuse the police for its partisan
political ends, Mr. Singh says.
Significantly, three of the seven key Supreme
Court directions in the case were the
States were to establish State Security
Commission (to insulate the police from
political pressure), Police Establishment
Board (to give autonomy in personnel
matters), and Police Complaints Authority
(to look into complaints of police
misconduct).
A compliance report by the Commonwealth
Human Rights Initiative (CHRI) paints a
dismal picture. It says that though most
States have set up the State Security
Commission, they do not reflect the courts
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criteria with regard to composition, function
and powers. Andhra Pradesh, Jammu and
Kashmir, Orissa and Tamil Nadu have not
complied with this directive.
Only Arunachal Pradesh, Goa, and
Meghalaya are in full compliance with all the
criteria laid down by the court for Police
Establishment Board, while Bihar has been
non-compliant.
Ironically, no State government has
established Police Complaints Authorities
at district and State levels that fully comply
with the court orders. A significant minority
Uttar Pradesh, Tamil Nadu, Mizoram,
Madhya Pradesh, Jammu and Kashmir and
Andhra Pradesh have completely ignored
the directive.
Another peculiar case is that of the Model
Police Bill, prepared in 2006 by the Police
Act Drafting Committee (PADC) of the
Union Home Ministry, which complements
the courts judgment. The Ministry, which
controls the Delhi Police, was to enact the
Model Act in the National Capital so that
it could be implemented by other States (as
law and order in a state subject), but the file
has been shuttling between North Block and
the Delhi government.
Noting that so far only 12 States have
enacted their own versions of the new Police
Act, CHRIs Coordinator (Police Reforms
Programme) Navaz Kotwal observes: A
cursory look at the recent laws shows that
most of these new pieces of legislation are
as regressive as if not more than the
archaic laws that they replaced. New laws
are being drafted in complete secrecy by a
small lobby of police officers and bureaucrats
without involving the public. They give
statutory sanction to all the bad practices
that existed. Worryingly, these Acts tend to
reduce or dilute accountability.
However, since the time the princely state of
Travancore appointed women as Special
Police Constables in 1933 for the first time in
modern India, progress on this front has been
tardy. While repeated recommendations state
that women should account for at least a third
of the civil police force up to the level of
sub-inspectors, as of 2011, of a total of 16.6
lakh personnel, only 93,887 were women. This
accounted for a mere 5.65 per cent, marking
an increase of 4.6 percentage points over two
decades since 1991.
Among the States, Maharashtra has made a
late surge. As of 2011, in absolute terms, it
had the highest number of women personnel,
doubling the number in two years since 2009.
It had 12,813 women in 2009 and the number
doubled to 24,219 in 2011, which is 13.2 per
cent of the 1.82 lakh-strong force. Tamil Nadu,
an early starter, followed with the figure of
15,864, also having doubled the number in
the two-year period. Yet, at the other end of
the spectrum is Mizoram, with not one
woman in a force of 10,861 and the Union
Territory of Daman and Diu.
Likewise, the representation of women in the
Central police forces remains dismal. Women
personnel and officers constituted a mere 2
per cent of the more than two lakh troopers
recruited by paramilitary forces in the last
three years and in the initial few months of
2013. While 20,73,48 personnel were recruited
in various ranks in the CRPF, the BSF, the
ITBP, the SSB, the CISF, Assam Rifles and
so on between 2010 and 2013, the number of
women among them was a mere 4,733.
Moreover, 13 States and Union Territories
have no all-woman police stations. According
to data from the Bureau of Police Research
and Development, there were just 442 such
police stations across India as on January 1,
2011. Tamil Nadu had the maximum number
of stations (196), followed by Uttar Pradesh
(71). Beyond the numbers, for the women
who are already in, there is a range of issues
that need to be addressed to mainstream and
empower them for the full gamut of policing
functions. A lot remains to be done also in
terms of working conditions and facilities
that are oriented to their needs.
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DONT MUDDY THE
KISHENGANGA VERDICT
The verdict (Part I) of the Court of Arbitration
(CoA) on the Kishenganga dispute raised by Pakistan
has gone in favour of India on the primary count of
whether or not the project ab initio violates the Indus
Waters Treaty (IWT). On a plain reading of the text
of the Treaty, the project was clearly in order.
Annexure D, Part 3, Section 15(iii) states, Where a
Plant is located on a tributary of the Jhelum on which
Pakistan has any agricultural or hydroelectric use,
the water released below the plant may be delivered,
if necessary, into another tributary but only to the
extent that the then existing agricultural use or
hydroelectric use by Pakistan on the former tributary
would not be adversely affected.
The Kishenganga is a tributary of the Jhelum
which takes the name Neelum on the Pakistan side of
Kashmir. The project under construction by India on
this stem was originally planned as a 900 MW storage
project but was subsequently converted into a 330
MW run-of-the river scheme following environmental
and displacement issues in the Indian catchment. The
revised project would divert Kishenganga flows east,
less ecological releases, through a tunnel to join the
Madmati Nullah. This in turn flows into the Kashmir
Valley to join the Wular Lake that is drained by the
main Jhelum which flows into the Pakistani side of
Kashmir where it is met by the Neelum river a little
above Muzaffarabad.
The charge of illegality raised by Pakistan was
thus clearly a red herring. The real issue was whether
Pakistan would receive sufficient flows for its own
930 MW Neelum-Jhelum project with a vague and
fluctuating irrigation component of up to 1,30,000
acres. India had agreed to let down some minimum
releases and also argued that these flows would be
augmented by other free flowing nullahs that join the
river between the Indian and Pakistan dams.
The CoA, however, has ruled that India must
maintain a minimum rate of flow below its
Kishenganga dam and that it will determine this
quantum in its final award to be announced by the
year-end. While that award is awaited, what is not
clear is whether the CoA satisfied itself about the
nature and quantum of Pakistans then existing
uses: when it first raised the issue with India. This
a matter on which the Pakistan position has been
dodgy from the very start, with varying claims but
little to show by way of then existing uses on the
ground.
This issue needs to be clarified beyond doubt,
else it will mean that while India is held to the letter
and spirit of the Treaty, Pakistan is not and its water
demand may be arbitrarily enhanced at will. The
second ruling the CoA has given is on Pakistans
argument that the Neutral Experts (NE) award on the
Baglihar dispute is bad insofar as it permits India to
deplete its dead storage in order to flush the reservoir
of accumulating sediment. India earlier compromised
on this issue in the case of the Sallal project, also on
the Chenab. In the result the dam all but silted up
within a single season, drastically reducing power
production. The CoA has however stated the ruling
would not apply to Indian projects currently under
operation or construction whose designs have been
communicated to Pakistan and have not been
objected to by the latter.
The fact is that against a total storage of 3.60
million acre feet to which India is entitled on the three
western rivers, the current storage is pretty near zero.
All its major projects are run-of-river schemes that
have strictly determined pondages. Section 2(g) of
Annexure D, defines a run-of-river plant as a
hydroelectric plant that develops power without Live
Storage as an integral part of the plant, except for
pondage and surcharge storages. Pondage, in turn,
means Live Storage of only sufficient magnitude to
meet the fluctuations in the discharge of the turbines
arising from variations in the daily and weekly loads
of the plants. The ponded water must be returned to
the river within 24 hours, the system operating much
like a circulating fountain.
THIRD ANTI-SUBMARINE
WARFARE CORVETTE LAUNCHED IN KOLKATA
In a major step towards indigenisation and
making the Navy self-reliant, the third anti-
submarine warfare (ASW) corvette,
designed under the ambitious Project-28 (P-
28) by the Navys Directorate of Naval
Design, was launched in Kolkata.
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Aimed at enhancing the Navys underwater
warfare capabilities, the warship, in a first of
its kind, will be fitted with indigenous state-
of-the-art weapons and sensors, including a
medium range gun, torpedo tube launchers,
rocket launchers and close-in weapon
system.
Being built by one of Indias leading
shipbuilders, Garden Reach Shipbuilders &
Engineers Ltd. (GRSE), it has been named
after an island Kiltan in the
Lakshwadweep archipelago of India.
With nearly 90% indigenisation content, the
building of the corvette was a major initiative.
The first GRSE-built ASW corvette, Kamorta,
is expected to be delivered to the Navy by
this year-end. It was launched on April 19,
2010 and had suffered a delay of nearly one
year.
The remaining ships, according to GRSE, will
be delivered by 2016. The fourth ASW
corvette will be launched in 2014 and built,
fitted and tested and delivered to the Navy
in little over 20 months.
BLACK CARBON FROM
SOUTH ASIA MELTING TIBETAN GLACIERS
Pollutants brought in by monsoon winds
from South Asia and not industrial
emissions from China are behind the
melting of glaciers on the Tibetan plateau, a
leading Chinese scientist has claimed.
NUCLEAR COOPERATION, KEY TO MULTIPLE
PROJECTS: KAZAKHSTAN
Kazakhstan has said interaction with India in
nuclear energy will open up prospects for
implementation of other breakthrough projects in
many of the priority sectors. Kazakhstan, the largest
and most dynamic economy among five Central
Asian states, wants civil nuclear energy cooperation
that will benefit both countries. Kazakhstan is a major
producer and exporter of uranium and has always
signalled its interest in supplying its products to
India. Its company Kazatomprom has already signed
an MoU with NPCIL. The foundation was laid with
the signing of an Inter-Governmental Agreement on
cooperation in peaceful uses of nuclear energy. This
led to Kazakhstan assuring India of supply of 2,100
tonnes of uranium. We hope that our cooperation in
the nuclear field will lead to intensive cooperation in
the exchange of technology and creation of joint
ventures, reiterated Mr. Idrissov, who is fluent in
Hindi. The two sides have already agreed to set up
a Centre of Excellence in information and
communication technology at Gumilyov Eurasian
National University in Astana. As it is known, Russia
took the initiative in 2000 to establish an international
transport corridor North-South and Kazakhstan
joined it in 2003. Kazakhstan.
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Gist of
YOJANA
BUDGET PROPOSALSAS OVERVIEW
U
nion Budget ended out creditably on
the main task for fiscal 2012-13. It kept
the fiscal deficit under control at 5.2
percent of GDP instead of the often feared 6 percent
estimate, as late as September 2012. Though
superficially the dip in the fiscal deficit is just a
marginal improvement from the revised target of 5.3
percent, it is the first time since 2008-09 that the fiscal
deficit calculated by the finance ministry will dip close
to 5 percent. This is significant considering that the
current account deficit will also close out this fiscal
almost at 5 percent. Further, the revenue deficit has
been contained at 3.9 percent in the current fiscal and
would be brought down to 3.3 percent in 2013-14.
Budget 2013-14 has staved off the downgrade
from international rating agencies, plumped for
investment at the cost of consumption and tried to
make India a better place to invest in. In the process
it has been harsh on expenditure. The Finance
Minister has used the scalpel on the subsidies too.
As the medium term fiscal policy statement notes
Major subsidies in the Revised Estimates for 2012-
13 have increased to Rs 2,47,854 crore as compared
to the Budget Estimates for 2012-13 of Rs 1,79,554
crore. The major part of increase has come from
petroleum subsidies that went up from Rs 43,580
crore in BE 2012-13 to Rs 96,880 crore in RE 2012-13.
This is a 122 percent rise that the minister has clawed
back in 2013-14.
So what is the scene with major subsidies?
They are budgeted at Rs 2,20,972 crore in BE 2013-14.
Total subsidies are at 2.6 percent of GDP in RE 2012-
13 and are budgeted to be at 2 percent of GDP in 2013-
14, the commitment the finance minister has taken on
from the Vijay Kelkar committee. The subsidy bill is
pegged lower by 11 percent in 2013-14. The Budget
hopes to cap the total expenditure on major subsidies
including fuel, food and fertiliser at Rs 2,20,971.50
crore for the 201,3-14 fiscal as against Rs 2,47,854
crore in the revised estimates for this fiscal.
Interestingly, the revised estimates for this
fiscal are higher by 38 percent compared to the
budget estimate of Rs 1,79,554 crore.
While the oil subsidy is pegged at Rs 65,000
crore for next fiscal against the revised estimate (RE)
of Rs 96,880 crore in 2012-13 fiscal, the food subsidy
is estimated to rise to Rs 90,000 crore next fiscal from
the RE of Rs 85,000 crore in 2012-13. The fertiliser
subsidy is also pegged slightly lower at Rs 65,971.50
crore in the next fiscal, as against the RE of Rs 65,974
crore in 2012-13 fiscal.
To balance these giveaways the budget has
built in an aggressive tax mobilisation target. It
includes Rs 18,000 crore of additional revenue
mobilisation measures. The same document says
With these measures tax revenues in 2013-14 are
expected to grow at 19.1 percent. The tax to GDP ratio
estimated in the Budget for 20 13-14 is 10.9 percent.
Budget Estimates for 2013-14 assumes a normal tax
growth of 17 percent over RE 2012-13 and remaining
tax growth emanating from additional resource
mobilization measures.
The bleak economic outlook gives the minister
space to keep tax giveaways to almost nil this year.
Once economic growth returns next year there will be
demands for tax breaks. The fiscal policy statement
points out As the tax to GDP ratio increases, further
improvements would be more gradual and difficult to
achieve. The outlook for tax revenues for the years
2014-15 and 2015-16 has been designed keeping this
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in mind. In a hope to reach a tax to GDP ratio of 11.9
percent, the Budget has estimated a 19 percent rise in
revenue receipts to Rs 10,56,331 crore in 2013-14 as
compared to a revised estimate of Rs 8,71,828 crore
for the fiscal.
So far as the market borrowings are concerned,
the gross market borrowings have been pegged at a
record Rs 6,29, 009 crore in 2013-14, the net
borrowings are expected to rise to Rs 4,84,000 crore.
This is just a 3.5 percent rise over the revised estimate
of Rs 4,67384 crore in the current fiscal. The
difference is due to the record redemption of bonds
estimated at Rs 1,45,009 crore in 2013-14.
It is betting heavily on proceeds from
disinvestment in state owned firms to help finance the
ambitious fiscal deficit target. The Budget has
doubled the disinvestment target for next fiscal to Rs
40,000 crore, as against a revised estimate of Rs
24,000 crore in the current fiscal. In addition, the
government is also betting on raising Rs 14,000 crore
from selling off its residual stake in Hindustan Zinc,
Balco and SUUTI.
Though finance minister P Chidambaram did
not announce the disinvestment target in his speech,
the total estimate of Rs 55,814 crore works out to the
highest target from stake sale proceeds in over a
decade.
Among the sectoral initiatives the finance
minister announced that independent regulator will
be expected to provide solutions to revive among
other the road sector, which has seen a slowdown in
award and implementation of projects.
To be eligible to claim the benefits the home
buyers will have to buy their first home whose value
should not exceed Rs 40 lakh and the home loan
should be restricted to Rs 251akh. While the loan
needs to be taken between April 1,2013 and March 31,
2014, the buyer can claim the available benefit of
deduction Rs 1 lakh over a period of two years.
In case the loan is taken in the middle of 2013-
14, the buyer can claim the applicable benefit in the
assessment year beginning April 2014 and the
remaining amount can be claimed in the next
assessment year. For the capital markets in an effort
to bring the derivative trading in commodities and the
securities market at par, the finance minister
announced the commodities transaction tax (CTT) of
0.01 percent of the price of the trade on all
commodities except agricultural commodities.
The finance minister also announced reduction
of the securities transaction tax on equity futures
from existing 0.17 percent to 0.01 percent bringing
both CTT and STT at par.
There is no distinction between derivative
trading in the securities market and derivative trading
in the commodities market, only the underlying asset
is different. I propose to levy CTT on non-
agricultural commodities futures contracts at the
same rate as on equity futures, which is at 0.01
percent of the price of the trade, said the Finance
Minister in his speech.
To revive the weakened investment climate in
the country and to quicken the implementation of
projects, the budget 2013-14 proposed to offer
incentives to companies that step in to make
investments. The finance minister has also
announced an investment allowance of 15 percent
for all new high value investments of more than Rs
100 crore over the next two financial years. The
benefit will be in addition to the current rates of
depreciation. It has however taken couple of
measures to plug the loopholes for tax avoidance by
companies.
But, what about inflation management? The
Reserve Bank of India would soon launch inflation-
indexed bonds to make people move away from gold
as the instrument of effective hedge against inflation.
This will be done next fiscal. We will have our cash
and debt management meeting towards the end of
this financial year and
hopefully, from the first or second month of the
next fiscal, we will launch inflation-indexed bonds,
RBI Deputy Governor HR Khan told reporters. The
central bank has been planning to introduce IIBs to
keep investors away from gold as a hedge against
inflation. The final surmise-a tough set of decisions
in a difficult year, that is what Budget 2013-14 will be
known as.
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12
TH
PLAN PROJECTS INVESTMENT OF RS 55,00,000 CRORE
IN INFRASTRUCTURE
While presenting the Budget for 2013-14, the Finance Minister P. Chidambaram said that the growth
rate of an economy is correlated with the investment rate. The key to restart the growth engine is to
attract more investment, both from domestic investors and foreign investors. He said that efforts will
be made to improve communication of the countrys policies to remove any apprehension or distrust
in the minds of investors, including fears about undue regulatory burden or application of tax laws.
Doing business in India must be seen as easy, friendly and mutually beneficial.
While every sector can absorb new investment, it is the infrastructure sector that needs large volumes
of investment. The 12th Plan projects an investments of USD 1 trillion or Rs. 55,00,000 crore in
infrastructure. The Plan envisages that the private sector will share 47 percent of the investment.
Besides, India needs new and innovative instruments to mobilize funds for this order of investment.
Government has taken or will take the following measures to increase investment in infrastructure:
Infrastructure Debt Funds (IDF) will be encouraged. These funds will raise resources and, through
take-out finance, credit enhancement and other innovative means, provide long-term low-cost debt for
infrastructure projects. Four IDFs have been registered with SEBI so far and two of them were launched
in the month of February, 2013.
India Infrastructure Finance Corporation Ltd (IICL), in partnership with the Asian Development Bank,
will offer credit enhancement to infrastructure companies that wish to access the bond market to tap
long term funds.
In the last two years, a number of institutions were allowed to issue tax free bonds. They raised Rs.
30,000 crore in 2011-12 and are expected to raise about Rs. 25,000 crore in 2012-13. It is proposed
to allow some institutions to issue, tax free bonds in 2013-14, strictly based on need and capacity to
raise money in the market, upto a total sum of Rs. 50,000 crore.
Multilateral Development Banks are keen to assist in efforts to promote regional connectivity.
Combining the Look East policy and the interests of the North Eastern States, it is proposed to seek
the assistance of the World Bank and the Asian Development Bank to build roads in the North Eastern
States and connect them to Myanmar.
NABARD operates the Rural Infrastructure Development Fund (RIDF). RIDF has successfully utilized
18 tranches so far. It is proposed to raise the corpus of RIDF-XIX in 2013-14 to Rs.20,000 crore.
Pursuant to the announcement made last year, a sum of Rs. 5000 crore will be made available to
NABARD to finance construction of warehouses, godowns, silos and cold storage units designed to store
units designed to store agricultural produce, both in the public and the private sectors. This window
will also finance, through the State Governments, construction of godowns by panchayats to enable
farmers to store their produce the Finance Minister announced.
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GROWTH IN GDP AT FACTOR COST AT 20045 PRICES (PERCENT)
2005-06 2006-07 2007-08 2008-09 2009-10
3R
2010-11
2R
2011-121R 2012-13
AE
Agriculture, forestry & fishing 5.1 4.2 5.8 0.1 0.8 7.9 3.6 1.8
Mining & quarrying 1.3 7.5 3.7 2.1 5.9 4.9 -0.6 0.4
Manufacturing 10.1 14.3 10.3 4.3 11.3 9.7 2.7 1.9
Electricity, gas, & water supply 7.1 9.3 8.3 4.6 6.2 5.2 6.5 4.9
Construction 12.8 10.3 10.8 5.3 6.7 10.2 5.6 5.9
Trade, hotels, & restaurants,
transport & communication 12.0 11.6 10.9 7.5 10.4 12.3 7.0 5.2
Financing, insurance, real estate &
business services 12.6 14.0 12.0 12.0 9.7 10.1 11.7 8.6
Community, social & personal services 7.1 2.8 6.9 12.5 11.7 4.3 6.0 6.8
GDP at factor cost 9.5 9.6 9.3 6.7 8.6 9.3 6.2 5.0
Source: Central Statistics Office (CSO).
Notes:
1R: First Revised Estimate,
2R: Second Revised Estimate,
3R: Third Revised Estimate,
AE: Advance Estimate.
PRIVATE FINAL CONSUMPTION EXPENDITURE: ANNUAL GROWTH AND SHARES AT 20042005 PRICE
2004-05 2006-07 2007-08 2008-09 2009-10 2010-11
1R
2011-12
2R
Annual Growth (Percent)
Food, beverages, & tobacco 3.4 6.4 3.3 0.4 5.9 5.8
Clothing & footwear 23.3 5.0 5.0 14.9 20.2 -3.9
Gross Rent, fuel, & power 3.8 4.7 3.6 6.0 4.2 6.2
Furniture, furnishings, etc. 17.1 16.1 12.2 9.0 16.6 6.2
Medical care & health services 8.7 4.5 6.9 8.9 7.6 6.2
Transport & communication 9.1 7.9 7.7 12.1 10.0 9.8
Recreation, education, & cultural services 8.4 9.8 6.8 4.0 11.8 8.1
Miscellaneous goods\ & services 21.1 28.6 20.2 15.7 7.9 19.1
Total private consumption expenditure 8.7 9.2 7.1 7.5 8.7 7.9
Share in Total (Percent)
Food, beverages, & tobacco 40.0 37.3 36.3 35.0 32.7 31.8 31.2
Clothing & footwear 6.6 8.3 8.0 7.8 8.4 9.3 8.2
Gross Rent, fuel, & power 13.8 12.6 12.1 11.7 11.5 11.1 10.9
Furniture, furnishings, etc. 3.4 3.9 4.1 4.3 4.4 4.7 4.6
Medical care & health services 5.0 5.0 4.8 4.8 4.8 4.8 4.7
Transport & communication 19.3 18.9 18.7 18.8 19.6 19.8 20.2
Recreation, education, & cultural services 3.0 3.0 3.0 3.0 2.9 3.0 3.0
Miscellaneous goods & services 8.9 11.0 13.0 14.6 15.7 15.6 17.2
Total private consumption expenditure 100.0 160.0 100.0 100.0 100.0 100.0 100.0
Source: CSO.
Notes:
1R: First Revised Estimate,
2R: Second Revised Estimate
HOW IS THE UNION BUDGET FORMULATED?
The budget process in India, like in most other countries, comprises four distinct phases:
(i) Budget formulation- preparation of estimates of expenditure and receipts for the ensuing financial
year;
(ii) budget enactment- approval of the proposed Budget by the Legislature through the enactment of
Finance Bill and Appropriation Bill;
(iii) budget execution- enforcement of the provisions in the Finance Act and Appropriation Act by the
government-collection of receipts and making disbursements for various services as approved by
the Legislature;
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(iv) legislative review of budget implementation- audits of governments financial operations on behalf of
the Legislature.
Process Commences in August-September
By convention, the Union Budget for next financial year is presented in Lok Sabha by the finance minister
on the last working day of February. However, the process of budget formulation starts in the last week of
August or the first fortnight of September. To get the process started, the Budget Division in the Department
of Economic Affairs under the Ministry of Finance issues the annual budget circular to all the Union
government ministries/departments around August- September. The Circular contains detailed instructions
for these ministries/ departments on the form and content of the statement of budget estimates to be
prepared by them.
Three kinds of figures in a Budget
The ministries are required to provide three different kinds of figures relating to their expenditures and
receipts during this process of budget preparation. These are: budget estimates, revised estimates and
actuals.
Lets understand this in the context of Union budget 2013-14, which was presented, as usual, on 28
th
of
February 2013 by the Finance Minister, Shri P Chidambaram on the floor of Lok Sabha. However, the process
of its formulation would have got started in August 2012 through issuance of budget circular of the Budget
Division and this process would have continued till February 2013.
The approval of Parliament is sought for the estimated receipts/expenditures for 2013-14, which would be
called budget estimates. At the same time, the Union government, in its budget for 2013-14, would also
present revised estimates for the ongoing financial year 2012-13. The government would not seek approval
from Parliament of revised estimates of2012-13; but, these revised estimates allow the government to
reallocate its funds among various ministries based on the implementation of the budget for 2012-13 during
the first six months of financiala year 2012-13. Finally, ministries also report their actual receipts and
expenditures for the previous financial year 2011-12. Hence, the Union budget for 2013-14 consists of budget
estimates for 2013-14, revised estimates for 2012-13, and actual expenditures and receipts of 2011-12.
Planning Commission comes in
The ministries would provide budget estimates for plan expenditure for budget estimates for the next financial
year, only after they have discussed their respective plan schemes with the Central Planning Commission.
The Planning Commission depends on the finance ministry to first arrive at the size of the gross budgetary
support, which would be provided in the budget for the next annual plan of the Union government. In
principle, the size of each annual plan should be derived from the approved size of the overall Five-Year
Plan (12th Five-Year Plan, 2012-13 to 2016-17, in the present instance). However, in practice, the size of the
gross budgetary support for an annual plan also depends on the expected availability of funds with the
finance ministry for the next financial year.
Reducing deficit, a Priority
In the past few years, the finance ministry has been vociferously arguing for reduction of fiscal deficit and
revenue deficit of the Union government, citing the targets set by the Fiscal Responsibility and Budget
Management Act and its rules. Hence, presently, the aspirations of the Planning Commission and Union
government ministries with regard to spending face the legal hurdle of this Act, which has made it mandatory
for the Union government to show the revenue deficit as nil (total revenue expenditure not exceeding total
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revenue receipts by even a single rupee) and the fiscal deficit as less than 3 per cent of GDP. This means
new borrowing of the government in a financial year cannot exceed 3 per cent of the countrys GDP for
that year.
Final Stages of Budget Preparation
During the final stage of budget preparation, the revenue-earning ministries of the Union government
provide the estimates for their revenue receipts in the current fiscal year (revised estimates) and next fiscal
year (budget estimates) to the finance ministry. Subsequently, usually in the month of January, more
attention is paid to finalisation of the estimated receipts. With an idea about the total requirement of
resources to meet expenditures in the next fiscal year, the finance ministry focuses on the revenue receipts
for the next fiscal.
At this stage of budget preparation, the finance minister examines the budget proposals prepared by the
ministry and makes changes in them, if required. The finance minister consults the Prime Minister, and
also briefs the Union Cabinet, about the budget at this stage. If there is any conflict between any ministry
and the finance ministry with regard to the budget, the matter is supposed to be resolved by the Cabinet.
Consultations with Various Stakeholders Crucial
In the run-up to Union Budget each year, the Finance Minister holds pre-budget consultations with
relevant stakeholders. The FM also holds consultations with Finance Ministers of States/Union
Territories as well as Trade and Industry representatives. This has great significance for the process of
budget formulation as it helps the FM take decisions on suitable fiscal policy changes to be announced
during the budget.
For this years budget, representatives from the agriculture sector, various trade unions, economists,
banking and financial institutions and also social sector groups participated in these consultations in
January 2013. Among others, a delegation of Peoples Budget Initiative also met Finance Ministry officials
and shared the Peoples Charter of Demands in the month of January 2013. But this year too, like in
previous years, the process started late. Desired changes in expenditure programmes and policies can
be influenced only if the consultations are begun earlier, preferably in October.
Consolidation of Budget Data
As the last steps, the budget division in the finance ministry consolidates all figures to be presented in
the budget and prepares the final budget documents. The National Informatics Centre (NIC) helps the
budget division in the process of consolidation of the budget data, which has been fully computerised.
At the end of this process, the finance minister takes the permission of the President of India for
presenting the Union budget to Parliament. It would be useful to point out that while the second and
the third stage in the budget cycle of our country are reasonably transparent, the first stage of actual
budget preparation cannot be said to be open. The process is rather carried out behind closed doors.
TAXATION : HIGHLIGHTS; UNION BUDGET 2013/14
Tax Savings of Rs. 2000 for assessee having taxable income upto Rs. 5 Lakhs
Additional deduction of interest upto Rs. I Lakhs for persons taking home loan (not exceeding Rs.
25 Lakhs) for their first home(not exceeding Rs. 40 Lakhs) during the period 01-04-2013 to 31-03-
2014
10 percent Surcharge on Individual, HUF, Partnership firms if the taxable income exceeds Rs. l
Crores
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10 percent Surcharge on domestic Companies if the taxable income exceeds Rs. 10 Crore. (5
percent - Surcharge if the taxable income exceeds Rs. 1 Crore) - Valid only for 1 year
5 percent Surcharge on foreign Companies if the taxable income exceeds Rs. 10 Crore. (2 percent
Surcharge if the taxable income exceeds Rs. 1 Crore) - Valid only for 1 year
Surcharge on Dividend Distribution Tax etc increased from 5 percent to 10 percent
Investment allowance of 15 percent for companies investing Rs. 100 Crore or more in plant and
machinery during 01-04-2013 to 31-03-2015
STT Reduced on Equity Futures/ MF Units.
Commodity transaction tax introduced on non-agricultural commodities futures contracts
One percent TDS on the value of the transfer of immovable property (except agricultural land)
where the consideration exceeds Rs. 50 Lakhs
Gross Total Income Limit under Rajiv Gandhi Equity Savings Scheme has been increased from 10
Lakhs to 12 Lakhs which shall be allowed for three consecutive assessment years.
Service Tax
All AC restaurants (Whether serving Alcohol or not) are subjected to Service Tax
Service Tax to be charged on Vehicle Parking fees
Excise
Specific Excise Duty Increased on Cigarettes, Cigars, Cheroots, Cigarillos
Excise Duty increased on SUV (Except those registered as taxis) from 27 percent to 30 percent
Excise duty increased on mobile phones (Pricing above Rs. 2000) from 1 percent to 6 percent
Customs
Duty free jewellery allowed from abroad in case of gentleman - Rs. 50000, in case of Lady-
Rs. 100000.
DO YOU KNOW?
What is Fiscal Responsibility and Budget
Management Act?
The Fiscal Responsibility and Budget Management
(FRBM) Act was enacted by the Parliament in 2003.
Its objective is to institutionalise fiscal discipline,
reduce fiscal deficit and improve macro economic
management. This law aims at promoting fiscal
stability for the country on a long-term basis. It
emphasises a transparent fiscal management
system and a more equitable distribution of debts
over the years. This law also gives flexibility to the
Reserve Bank of India to undertake monetary
policy to control inflation.
Government needs resources for funding various
kinds of developmental schemes and routine
expenditures. Resources are raised through taxes
and borrowing. The government can raise funds
by borrowing from the Reserve Bank of India,
financial institutions or from the public by floating
bonds. Fiscal deficit is the total expenditure minus
the revenue receipt, loan recoveries and receipts
from disinvestment etc. It is a measure of the
government borrowing in a year.
However, uncontrolled fiscal deficit is considered
harmful for the health of economy. FRBM Act was
notified in 2004 in response to the need felt to curb
large fiscal deficit. The FRBM rules specify annual
reduction targets for fiscal indicators. Originally, the
act envisaged revenue deficit to be reduced to nil
in five years beginning 2004-05. Fiscal deficit was
required to be reduced to 3 percent of GDP by 2008-
09. The Act also provides exception to the
government in case of natural calamity and for
national security.
The implantation of the act was put on hold in
2007-08 due to global financial crisis and the need
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for fiscal stimulus. There was a need for increased
government expenditure to create demand to fight
off the financial downturn and hence the
government moved away from the path of fiscal
consolidation for this period.
This law also prohibits borrowing by government
from the Reserve Bank of India and purchase of
primary issues of central government securities
after 2006. The act asked the Central government to
lay in Parliament three statements in one financial
year about the fiscal policy. To enforce fiscal
discipline at the state level, the Twelfth finance
commission provided for incentives to states
through conditional debt restructuring and interest
rate relief.
In 2012, the FRBM was amended and it was
decided that the FRBM would target effective
revenue deficit in place of revenue deficit. Effective
revenue deficit excludes capital expenditure from
revenue deficit and thus gives space to the
government to spend on creation of capital assets.
The critics of this law feel, it would curb the
governments social sector spending but there is no
denying the fact that the need for fiscal
sustainability cannot be ignored.
What is GST?
The Goods & Services Tax (GST) is an indirect tax
reform measure which will replace all other indirect
taxes such as Central Sales Tax, Octroi, excise duty,
Service Tax and Value Added Tax (VAT) at the
central and state levels. India will have a dual GST
system where states and the centre both would
have power to levy taxes on goods and services.
Exports would be an exception and GST will not be
imposed on them. Under the GST, no distinction is
made between goods and services for purpose of
levying tax. GST is a value added tax where the
person paying tax on his output is also entitled to
get input tax credit on the tax paid on its inputs.
The idea of GST was first proposed in the budget
speech of 2006-07 which had set out the deadline
of 2010 for its introduction in the country. To
implement such a tax regime a constitutional
amendment would be needed as the Centre as well
the States are involved in this issue. The
government expects that the legislative process for
the enactment of the GST would be started in the
next few months. The Finance Minister has
expressed the hope that the two tax reforms - the
GST and Direct Tax Code (DTC) will be
implemented soon.
The objective of GST is to make the taxation simple
and to broaden the tax base. It will also help create
a common market throughout the length and
breadth of the country. The GST has the advantage
of redistributing the burden of taxation equitably
between manufacturing and services. The rate of
taxation is also likely to come down with the
introduction of GST. Goods of basic importance will
have lower tax rates. Better compliance and
increased tax collection will boost the tax to GDP
ratio. Economic growth is also likely to get an
impetus through GST. A report of National Council
of Applied Economic Research has estimated an
increase of 0.9 percent to 1.7 percent in the
economic growth with the implementation of GST.
Exports is will also increase according to this study.
BUDGET 201314 AND BEYOND:
WHAT IT MEANS FOR FISCAL CONSOLIDATION?
It May not be an exaggeration to say that
Budget 2013-14 has been crafted in most challenging
macroeconomic circumstances reflected in high fiscal
imbalance, declining GDP growth, high inflation,
increasing current account deficit (CAD) and an
uncertain global economic environment. Rising crude
prices in the international market and increasing gold
import as an instrument of asset holding increased
the CAD and thereby external sector imbalance.
These external shocks further compounded the
problem of macro instability in presence of high fiscal
deficit and stubbornly high inflation. There is no
doubt that the budget 2013-14, squarely focused on
fiscal consolidation. The idea is that fiscal
consolidation would revive growth and if growth
picks up that would help correct other macro
imbalances and challenges of development through
higher growth of public revenues. Thus, the
question is would growth pick up in the short run due
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to measures of fiscal consolidation proposed in the
budget? Lot would depend upon host of
macroeconomic factors; both on the fiscal and
monetary side, including critical reforms like GST.
High fiscal deficit of the central government is
not a new phenomenon. It remained at an
uncomfortably high level since 2008-09. Alternative
estimates before the budget suggested that the fiscal
deficit will be close to 6 per cent of GDP in 2012-13
(RE). However, the budget 2013-14 (BE) pegged the
fiscal deficit at 4.8 per cent of GDP and as per the
2012-13 (RE), it is expected to be 5.2 per cent of GDP.
The biggest challenge would be to maintain these
targets as the fiscal year progresses. Although,
achieving these targets assume priority, we need to
recognise the fact that path of fiscal adjustment is
equally important as the target.
Before we comment on the path of fiscal
adjustment, it may be worthwhile to see the nature of
fiscal imbalance of the central government. As
evident from the fiscal deficit is driven by revenue
deficit. In the year 2011-12, the share of revenue
deficit in fiscal deficit was 76.43 per cent. But the
Budget 2013-14 (BE) expects it to be at 70 per cent. In
other words, major share of the borrowed resources
are being used to finance the revenue expenditure of
the centre which is by and large in nature of current
consumption. Although, this sounds quite alarming,
the effective revenue deficit (ERD), which is the
component of revenue deficit when adjusted for
grants given for creation of capital assets, for the year
2013-14 (BE) estimated at 1.8 per cent of GDP. The
practice of estimating ERD is a recent introduction in
our budget. The significance of the concept of ERD
would depend on the nature of use of the grants
given for capital assets. If funds used remains by
nature of consumption, depending on ERD as a
measure of fiscal prudence would be misleading.
NEW MEASURES FOR WELFARE OF SC/ST, WOMEN AND MINORITIES
Sharing the concerns of the Members of the House for the welfare of the scheduled castes and the
scheduled tribes, the Finance Minister P. Chidambaram announced that the Budget has sub plans for
them and reiterated that the funds allocated to the sub plans cannot be diverted and must be spent for
the purpose of the sub plans. He made an allocation of Rs. 41, 561 crore to the scheduled castes sub plan
and Rs. 24,598 crore to the tribal sub plan. Similarly, sufficient allocations have been made to
programmes relating to women and children. The Minister informed the Members that the gender budget
has Rs. 97,134 crore and the child budget Rs. 77, 236 crore in 2013-14.
He said, women belonging to the most vulnerable groups, including single women and widows, must be
able to live with self-esteem and dignity and added that young women face gender discrimination
everywhere, especially at the work place. Ministry of Women and Child Development has been asked to
design schemes that will address these concerns and a sum of Rs. 200 crore has been provided to begin
work in this regard.
The Finance Minister allocated Rs. 3,511 crore to the Ministry of Minority Affairs, which is an increase
of 12 percent over the BE and 60 percent over the RE of 2012-13. The Maulana Azad Education
Foundation is the main vehicle to implement education schemes and channelized funds to non-government
organisations for the minorities. Its corpus stands at Rs. 750 crore. With the objective of raising it to Rs.
1500 crore during the 12th Plan period, the Minister proposed to allocate Rs. 160 crore to the corpus
fund. The foundation wishes to add medical aid to its objectives and the same has been accepted that a
beginning can be made by providing medical facilities such as a resident doctor in the educational
institutions run or funded by the Foundation. Rs. 100 crore is being allocated to launch this initiative.
He said, government is committed to provide support to persons with disabilities and announced a sum
of Rs. 11 0 crore to the Department of Disability Affairs for the ADIP Scheme in 2013-14.
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BUDGET: CONCEPTS AND TERMINOLOGIES
Budget of a government is a comprehensive
statement of government finances relating to a
particular year. Every Budget broadly consists of two
parts- (i) Expenditure Budget and (ii) Receipts
Budget.
The amounts of intended expenditure by the
Government in the next financial year are expressed
in the Expenditure Budget.
The entire Expenditure Budget can be divided
into two distinct categories, viz.
(i) Capital Expenditure- those expenditures by
the government that lead to an increase in
the assets or a reduction in the liabilities of
the government. It is however not necessary
that the assets created should be productive
or they should even be revenue generating.
Only the charges towards the construction
of the asset are counted as Capital
expenditure, while the subsequent charges
for its maintenance are considered as
Revenue expenditure. Most capital
expenditure is non-recurring.
Examples of Capital Expenditure causing
increase in assets: construction of a
new Flyover, Union Govt. giving a Loan
to a State Govt.
Examples of Capital Expenditure
causing reduction of a liability: Union
Govt. repays the principal amount of a
loan it had taken in the past.
(ii) Revenue Expenditure- those expenditures by
the government that do not affect its asset-
liability position. Most kinds of revenue
expenditures are seen as recurring
expenditures. The entire amount of Grants
given by the Union Government to States is
reported in the Union Budget as Revenue
Expenditure, even though a part of those
Grants get utilized by States for building
Schools, Hospitals etc. This is so because
the ownership of the schools or hospitals
built from the Central grants would not be
with the Union Government.
Examples of Revenue Expenditure are:
expenditure on Food Subsidy, Salary of
staff, procurement of medicines,
procurement of text books, payment of
interest, etc
Total government expenditure can also be
divided into another set of categories, viz.
(i) Plan Expenditure: Plan expenditure refers to
government expenditure, which is meant for
financing the programmes/schemes
formulated under the ongoing/previous Five
Year Plan
(ii) Non-Plan Expenditure: Expenditures of the
government, which are not included under
the Plan Expenditure are called Non Plan
Expenditure. It includes some of the
important types of government expenditure,
eg: interest payments, pension, defence
expenditure, spending on law and order,
spending on legislature, subsidies, and
salary of regular cadre teachers, doctors and
other government officials.
The Receipts Budget presents the information
on how much the Government intends to collect as
its financial resources for meeting its expenditure
requirements and from which sources, in the next
fiscal year. This can also be divided into two
categories:
(i) Capital Receipts- those receipts that lead to
a reduction in the assets or an increase in
the liabilities of the government.
Capital Receipts that lead to a
reduction in assets: Recoveries of
Loans given by the government and
Earnings from Disinvestment;
Capital Receipts that lead to an
increase in liabilities: Debt.
(ii) Revenue Receipts- those receipts that dont
affect the asset-liability position of the
government. Revenue Receipts comprise
proceeds of Taxes (like, Income Tax,
Corporation Tax, Customs, Excise, Service
Tax, etc.) and Non-tax revenue of the
government (like, Interest receipts, Fees/
User Charges, and Dividend & Profits from
PSUs).
Government revenue through taxation can be
divided into Direct Taxes and Indirect Taxes.
Direct Taxes: Those taxes for which the tax-
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burden cannot be shifted are called Direct Taxes.
Examples of Direct Taxes are:
(i) Corporation Tax: This is a tax levied on the
income of registered companies in the
country, whether national or foreign, under
the Income Tax Act, 1961.
(ii) Personal Income tax: This is a tax on the
income of individuals, firms etc. other than
Companies, under the Income Tax Act, 1961.
This head also includes other Taxes, mainly
the Securities Transaction Tax, which is
levied on transaction in listed securities
undertaken on stock exchanges and in units
of mutual funds.
(iii) Wealth Tax: This is a tax levied on the
benefits derived from the ownership of
property, under the Wealth Tax Act, 1957.
Wealth tax has virtually been abolished in
India.
Indirect Taxes: Those taxes for which the tax-
burden can be shifted are called Indirect Taxes. Any
person, who directly pays this kind of a tax to the
Government, need not bear the burden of that
particular tax; he/she can ultimately shift the tax-
burden to other persons later through business
transactions of goods/ services. Indirect tax on any
good or service affects the rich and the poor alike!
Unlike indirect taxes, direct taxes are linked to the
tax-payees ability to pay and hence are considered
to be progressive. Examples of Indirect Taxes are:
(i) Customs Duties: In this, the taxable
component is import into or export from the
country.
(ii) Excise Duties: It is a type of tax levied on
those goods, which are manufactured in the
country and are meant for domestic
consumption. It is a tax on manufacturing,
which is paid by the manufacturer, but he
passes this burden on to the consumers.
(iii) Sales Tax: It is levied on the sale of a
commodity, which is produced imported and
being sold for the first time. If the Product
is sold subsequently without being
processed further, it is exempt from sales tax.
Before the introduction of VAT, sales tax
used to be levied under the authority of both
Central Legislation (Central Sales Tax) and
State Governments Legislation (Sales Tax)
(iv) Service Tax: It is a tax levied on services
provided by a person and the responsibility
of payment of the tax is cast on the service
provider. However this tax can be recovered
by the service provider from the service
receiver in course of his/her business
transactions.
(v) Value Added Tax (VAT): VAT is a multi-stage
tax, intended to tax every stage of sale of a
good where some value has been added to
the raw materials; but taxpayers do receive
credit for tax already paid on the raw materials
in earlier stages.
Debt and Deficit
A Debt is a kind of receipt that necessarily
leads to an increase of the governments liabilities.
The government incurs a Debt only for meeting the
gap created by excess of its expenditure over its
receipts for that year, which is called Deficit.
Fiscal Deficit
It is the gap between the governments total
Expenditure (including loans net of repayments) and
its Total Receipts (excluding new debt to be taken).
Thus Fiscal Deficit for a year indicates the borrowing
to be made by the government that year.
Revenue Deficit
The gap between Total Revenue Expenditure
of the Government and its Total Revenue Receipts is
called the Revenue Deficit
Distribution of financial resources
between the Centre and the States
A Finance Commission is set up every five
years to recommend measures for sharing 0 resources
between the Centre and the States, mainly pertaining
to the Tax Revenue collected by the Central
Government. Presently the recommendations made
by the 13th Finance Commission are in effect (from
2010-11 to 2014-15), whereby 32 percent of the
shareable divisible pool of Central tax revenue is
transferred to States every year and the Centre
retains the remaining amount for the Union Budget.
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Tax-GDP Ratio
Gross Domestic Product CGDP) is an indicator
of the size of a countrys economy. In order to
assess the extent of governments policy
interventions in the economy, some of the important
fiscal parameters, like, total expenditure by the
government, tax revenue, deficit etc. are expressed as
a proportion of the GDP. Accordingly, a countrys tax-
GDP ratio helps us understand how much tax
revenue is being collected by the government as
compared to the overall size of the economy. A higher
tax to GDP ratio in a country is a positive sign
meaning that the government is collecting a decent
amount of tax revenue as compared to the size of its
economy.
A POWER SECTOR REVIEW OF BUDGET
A Power Sector has to play a key role in the
countrys quest for economic growth and a major
focus on providing power to all. Indian Power sector
has been facing major set of challenges since last
year with shortage of fuel and lack of distribution
reform. The coal availability has emerged as one of
the biggest problems in power sector as can be
understood through the fact that there was a 11.6
Billion Units shortfall in power generation during
2011-12 due to shortage of coal (Central Electricity
Authority). Gas availability for Indian power sector is
also very low.
Therefore, no new projects on gas based
generation will be possible before 20 15-16 (as there
is a possibility of coming of LNG terminal in western
coast only by 2015-16). From the present shortage of
fuel, it is very much evident that the country is
dependent on more and more of fuel imports. Thus
moving towards more imports of coal and gas in line
with oil imports, is a major cause for concern as this
will further add up to the problem of current account
deficit. The fuel shortage problems of power sector
needs a long term strategy and therefore would take
some time to put the sector back on track. Finance
Minister, in his budget (2013-14) proposal for power
sector has suggested that we must reduce our
dependence on coal imports.
The major announcements for power sector in
the budget are as follows:
Financial restructuring of the DISCOMS to
restore the health of the power sector and
states are advised to quickly to prepare the
financial restructuring plans, sign MOUs
and take advantage of the scheme
Cabinet Committee on Investment (CCI) to
be consulted in taking up decisions in oil/
power/coal projects
Rs. 800 crores allocated for Ministry of New
and Renewable Energy, so Wind Power
Sector heaves a sigh of relief
Tax holiday for power plants extended for
one more year up to March, 2014
Wind energy sector to get generation based
incentives
To encourage states to take up waste to
energy (WTE) projects via PPP mode
Rs. 5280 crores allocated to Department of
Energy
Current Account Deficit still high - one of
the main reasons is high import of coal
Coal import in April-December, 2012 at 100
million tonnes, to rise to 185 million tonnes
in 2013-14
For increasing coal supply, PPP projects
along with Coal India has been announced
Oil and Gas policy to be announced
The recent buzz word in USA is Shale Gas
for future energy needs. So it is a welcome
move that Govt. of India will announce Shale
Gas policy soon
Oil and Gas blocks under National
Exploration Licensing Policy (NELP) to be
cleared this year
Natural Gas Pricing Policy to be reviewed -
to benefit the gas companies
Five LNG terminals Dabhol in Ratnagiri
district of Maharastra will be operational in
2013-14
Rate of Withholding tax on interest payments
on ECB is proposed to be reduced from 20 to
5 percent which will benefit power sector also
Duties have been equalized on steam and
bituminous coal used for generation. Now
both would attract 2 percent customs and 2
percent countervailing duty (CVD).
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This customs duty and CVD will push up the
coal prices and generation costs and widen the price
differential with domestic coal fired power.
Extension of the sunset clause for availing ten
year tax holiday for a year would benefit
approximately 20 Giga Watts of capacities to be
commissioned in 2013-14. The extension would drive
promoters to complete ongoing projects quickly and
this may attract fresh investment. Funding will also
improve with the issuance of tax-free bonds of Rs.
50,000 crores and credit enhancement through IIFCL.
The proposal to adopt a PPP framework for
coal production will improve domestic supply of coal
in the long term. Custom duty on imported coal,
which was previously exempt, has been increased to
two percent while countervailing duty has also been
raised to two percent. Further the Railway budget
hiked freight rates by 5.8 percent. Consequently,
generation costs will increase per unit for coal- based
projects.
Introduction of 2 percent customs duty and 2
percent CVD will have an impact on the price of
imported coal and on the cost of power generation
and is expected to increase the tariff. The upshot is
that around 60 to 70 percent coal imported earlier for
thermal power plants was exempt from any customs
duty. Now this category of coal will see a rise in costs
of imports and resulting rise in cost of generation.
Changes in duties on coal, railway tariffs and
other costs will raise generation cost by 20 paise per
unit and much higher in states where power utilities
are making losses. The hike would be steepest where
utilities are reeling under losses. Moreover the states
which will be adopting financial restructuring package
burdened with heavy losses, have to announce tariff
hike as one of the conditions for restructuring.
For the first time budget has made provision
for waste- to- energy (WTE) projects via PPP mode.
This will be supported through different instruments
like viability gap funding (VGF), repayable grant and
low cost capital. A debate has started on the
suitability of such projects as environmentalists are
of the opinion that these projects and technologies
are not suitable for India. Though Municipal bodies
say it is the most effective way to manage waste and
this may encourage private players as there is
provision for VGP. Delhi has such plant of 16 MW
capacity at Okhla and other two projects will be
operational at Gazipur and Narela -Bawana by this
year end. WTE projects are the only way to dispose
waste in the metro cities.
As per the budget estimate, coal imports
during the period April-December, 2012 have crossed
100 million tones. It is estimated that import will rise
to 185 million tonnes in 2016-17. If the coal
requirements of the existing power plants and the
power plants that will come into operation by
31.03.2015 are taken into account, there is no
alternative except to import coal and adopt a policy
of blending and pooled pricing. Finance Minister has
suggested that in the medium and long term, we must
reduce our dependence on coal imports. This can be
achieved through devising a PPP policy framework
with Coal India Limited (CIL) in order to increase the
production of coal for supply to power producers.
These matters are under active consideration and
Minister of Coal will announce Governments policies
in due course.
There was a mis- classification between steam
and bituminous coal as both are used in thermal
power plants. The steam coal was exempt from
customs duty but attracts a CVD of one percent.
Bituminous coal attracted a duty of 5 percent and a
CVD of 6 percent. The budget proposed to equalize
the duties on both kinds of coal and levy 2 percent
customs duty and 2 percent CVD to avoid these mis-
classification.
Since there is change in coal pricing policies of
different countries mainly Indonesia and Australia,
the Indian import price of coal has increased. All the
power producing companies who have signed a long
term power purchase agreements with various
utilities, now want revision of price due to this change
in imported coal price. But no clear policy has been
declared as yet by Central or State Govt. in this
regard.
So power plants based on imported coal are
operating at under capacity. Now Indian power
producers are looking for imported coal from
politically stabilsed south East African countries like
Mozambique and Botswana other than South Africa
as new source.
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AGRICULTURE AND BUDGET
Huge Food grains stocks and rising exports of
Indias agricultural goods, the Union Budget
presentation for 2013-14 would not have come at a
better time for the sector which employs more than
half of countrys working class population.
As Finance Minister P Chidambaram rose to
present the un ion budget for the year 2013-14, there
was lot of expectation from the farming community.
Nothing explains the agriculture sector better than
the Economic Survey 2012-13 presented before the
Parliament just a day before the union budget was
announced. The survey observed Indian agriculture
is broadly a story of success. It has done remarkably
well in terms of output growth, despite weather and
price shocks in the past few years.
The Eleventh Five Year Plan (2007-12)
agricultural and allied sector witnessed an average
annual growth of 3.6 percent in the gross domestic
product (GDP) against a target of 4.0 percent. While
it may appear that the performance of the agriculture
and allied sector has fallen short of the target,
production has improved remarkably, growing twice
as fast as population. Indias agricultural exports
are booming at a time when many other leading
producers are experiencing difficulties, the survey
which is an annual report card of governments
performance noted.
At a nutshell, India is the first in the world in
terms of production of milk, pulses, jute and jute-like
fibres, second in rice, wheat, sugarcane, groundnut,
vegetables, fruits and cotton production, and is a
key producer of spices and plantation crops as well
as livestock, fisheries and poultry sector.
Prior to announcing the budget measures,
Chidambaram said, thanks to our hard working
farmers, agriculture continues to perform very well.
The average annual growth rate of agriculture and
allied sector during the 11
th
Plan was 3.6 percent as
against 2.5 percent and 2.4 percent, respectively, in
the 9
th
and 10
th
Plans.
He noted in 2012-13, total foodgrain
production will be over 250 million tonnes. Minimum
support price of every agricultural produce under the
procurement programme has been increased
significantly. Farmers have responded to the price
signals and produced more. Agricultural exports from
April to December, 2012 have crossed Rs 138,403
crore, Chidambaram noted. Though government
constantly focuses on increasing exports of
manufactured goods and services, according to a
recent paper written by the Commission for
Agricultural Costs and Prices (CACP) chief Ashok
Gulati and others, its off-on policy on agricultural
exports is preventing the country for achieving its
potential.
If the government is proactive, FY12 exports
can cross $42- 43 billion, Gulati says. In 2011-12,
according to Gulati, agricultural exports by India were
more than $37 billion against an import of
commodities worth around $17 billion. India has
emerged as the worlds largest exporter of rice,
replacing Thailand and Vietnam and the country has
also the biggest exporter of buffalo meat beating
traditionally strong countries such as Brazil, Australia
and the US.
CACP research paper titled Farm trade:
Tapping the hidden potential has stated that
agricultural exports have increased more than 10 fold
from $3.5 billion in 1990-91 to $37.1 billion in 2011-12.
This share is more than the share that India has in
global merchandise exports, the paper has noted.
The agriculture sector which employs more
than 55% of the country workforce stands at a cross
roads. Measures taken by the government during
next few years would decide the shape the
agriculture sector would take. As the latest Economic
survey points out that India is at a juncture where
further reforms are urgently required to achieve
greater efficiency and productivity in agriculture for
sustaining growth. There is need to have stable and
consistent policies where markets playa deserving
role and private investment in infrastructure is
stepped up. An efficient supply chain that firmly
establishes the linkage between retail demand and
the farmer will be important.
The survey also points out that rationalization
of agricultural incentives and strengthening of food
price management will also help, together with a
predictable trade policy for agriculture. These
initiatives need to be coupled with skill development
and better research and development in this sector
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along with improved delivery of credit, seeds, risk
management tools, -and other inputs ensuring
sustainable and climate-resilient agricultural
practices. One of the key proposal announced by
Finance Minister P Chidambaram in his budget
speech includes close to 22% jump in the agriculture
credit target for the next fiscal besides granting
similar hike in allocation for the agriculture ministry.
Agricultural credit is a driver of agricultural
production. We will exceed the target of Rs 5,75,000
crore fixed for 2012-13. For 2013-14, I propose to
increase the target to Rs 7, 00, 000 crore,
Chidambaram said while presenting the Budget for
the 2013-14.
The finance minister also announced
continuance of the interest-subvention for short-
term crop loan. Farmers who repay loan on time will
be able to get credit at 4% interest per annum. He
also announced extension of crop loan scheme to
private sector banks along with the loan extended
by public sector banks, Regional Rural Banks and
cooperative banks.
So far, the scheme has been applied to loans
extended by public sector banks, Regional Rural
Banks and cooperative banks, I propose to extend
the scheme to crop loans borrowed from private
sector banks and scheduled commercial banks in
respect to loans given within the service area of the
branch concerned, Chidambaram announced.
Similarly, another thrust of the finance
ministers budget proposal was 22% increase in
financial grant for the agriculture ministry to Rs
27,049 crore for the next fiscal in comparison to last
year. The hike in allocation also includes Rs 3,415
crore earmarked for agricultural research.
Another key proposal announced by the
finance minister include a Rs 1000 crore allocation
under the Bringing Green Revolution in the Eastern
India (BGREI) for the next fiscal. For augmenting rice
production in states including Assam, Odisha,
Jharkhand and West Bengal, the government had
allocated Rs 400 crore in 2011-12 and Rs 1000 crore
during the current fiscal. The original Green
Revolution States face the problem of stagnating
yields and over-exploitation of water resources. The
answer lies in crop diversification.
GENDER ISSUES: BUDGET PROPOSALS
The Union Budget 2013-14 is realistic, woman-
centric, shorn of fanfare and attuned to the harsh
global and domestic economic realities. The
backdrop remains challenging - hesitant global
growth, persisting problems in the Euro zone, high oil
prices, high domestic inflation, current account and
fiscal imbalances and a sharp slowdown in the
industrial sector.
There are no dramatic initiatives. Rather, it is
about staying the course. There are no overt negative
or regressive measures. The budget strikes the right
balance between the often conflicting demands of
fiscal rectitude, inflation, growth and inclusion. The
Finance Minister has sent the right signals as
regards the future course of reforms. He has also
unequivocally articulated his commitment to
restoring trust and confidence among entrepreneurs
and investors and reducing the obstacles to doing
business in India. At a time when business
confidence needs to be revived, this is indeed
reassuring.
The woman-centric budget, presented by
Union Finance Minister, P. Chidambaram in the Lok
Sabha gave enough reasons for Indian woman to
smile. The gender budget has Rs. 97,134 crore and the
child budget has Rs. 77,236 crore in 2013-14.
As a huge step towards empowerment of
women, the government proposed to set up the
countrys first womens bank as a public sector bank.
The Finance Minister will provide 1,000 crore as
initial capital. He hopes to obtain the necessary
approvals and the banking licence by October 2013.
Mr. Chidambaram said women were at the head
of many banks today, including two public sector
banks, but there was no bank that exclusively served
women. The Budget 2013-14 has provided for setting
up a bank that lends mostly to women and women-
run businesses, that supports women Self Help
Groups and womens livelihood, that employs
predominantly women, and that addresses gender
related aspects of empowerment and financial
inclusion.
Research has shown that women, specially
rural women, were not confident of making financial
decisions. They would feel more confident if they
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could walk into a bank where people would listen and
empathise with them. The PSU bank will be good
because it will help women make their own decisions.
Research says women are more comfortable with
women managers or advisors. Also, a bank run by
women means they can go there without a male
member of the family.
Of the three big promises made by Mr.
Chidambaram in his budget proposals for 2013-14, the
first was the collective responsibility to ensure the
safety and dignity of women. Towards this end, the
government announced a proposal to set up a
NIRBHAYA FUND with an allocation of Rs. 1,000
crore. Union Women and Child Development
Minister and other Ministers concerned will work out
the details of all structure, scope and application of
the Fund.
Referring to the horrific case of gang rape and
murder of a young woman in the National Capital in
December, Mr. Chidambaram said recent incidents
had cast a long dark shadow on our liberal and
progressive credentials.
As more women enter public spaces - for
education or work or access to services or leisure -
there are more reports of violence against them. We
stand in solidarity with our girl children and women.
And we pledge to do everything possible to
empower them and to keep them safe and secure, the
Finance Minister said, adding that a number of
initiatives were under way and many more would be
taken by government as well as non-government
organisations.
Saying these deserved government support,
Mr. Chidambaram announced the NIRBHAYA
FUND, named after the gang rape victim.
Pointing out that women belonging to the
most vulnerable groups, including single women
and widows, must be able to live with self-esteem
and dignity, the Minister said young women faced
gender discrimination everywhere, especially at the
work place. The Ministry of Women and Child
Development has been asked to design schemes that
wi11 address these concerns. I propose to provide
an additional sum of Rs. 200 crore to the Ministry to
begin work in this regard, he said.
Another small proposal in the gender budget
is that it has raised the maximum amount of jewellery
that may be brought home by Indian women who
have lived abroad for more than a year or who are
changing residence from Rs. 20,000 to Rs. 1,00,000
A scheme for maternal and child malnutrition
for the 100 poorest districts with an allocation of Rs.
300 crores is also envisaged. The budget has
substantially increased allocations to schemes that
allow for direct cash transfers to women and young
Indians. The Indira Gandhi Matritva Sahyog Yojana
(IGMSY) that envisages providing cash assistance
directly to pregnant and lactating women has seen
its budget allocation for the coming year going up to
almost five times the Revised Estimate for the current
year.
The 2013-14 budget is, in fact, a good one,
aiming to improve the economy with strong focus on
infrastructure and rural development and with stress
on women, youth and the poor, who constitute a
majority of the population.
PROCEDURES FOR
FOREIGN PORTFOLIO INVESTORS SIMPLIFIED
Terming the Indian markets as amongst the best
regulated the Finance Minister announced several
measures to strengthen the capital market regulator
SEBI on the eve of its Silver Jubilee. The
Depository Participants authorized by SEBI will
now register different classes of portfolio investors
subject to compliance with KYC guidelines doing
away with different procedures and avenues for
many categories. SEBI will simplify the procedure
for the Foreign Portfolio Investors and prescribe
uniform registration and other norms by
converging the different KYC norms. In order to
remove the ambiguity between FDI and FII in
accordance with international practices, an
investor with a stake of 10% or less will be treated
as FH whereas the one with more than 10% stake
will be treated as FDT. The FIIs will also be
permitted to participate in exchange traded
Currency Derivatives segments to the extent of
their Indian rupee exposure in India. FIls will also
be permitted to use their investments in Corporate
Bonds and Government Securities as collateral to
meet their margin requirements.
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Angel investors provide both experience and
capital to new ventures. SEBI will prescribe
requirements for angel investor pools by which
they can be recognized as category I venture
funds. With the objective of developing the debt
market, stock exchanges will be allowed to
introduce a debt segment on the exchange wherein
banks and primary dealers will be trading members
alongwith insurance companies, provident funds
and pension funds. The list of eligible securities in
which Pension Funds and Provident Funds may
invest will be enlarged to include exchange traded
funds, debt mutual funds and asset backed
securities.
HIGHLIGHTS OF THE ECONOMIC
SURVEY 2012-13
Economic growth pegged at 6.1-6.7 percent
in 2013-14
March 2013 inflation estimated at 6.2-6.6 per
cent
Priority will be to rein in high inflation
FDI in retail to pave the way for investment
in new technology and marketing of
agriculture produce
Survey calls for widening of tax base and
prioritising expenditure to bridge fiscal deficit
Calls for curbing gold imports to contain
current account deficit
Aadhaar-based direct cash transfer scheme
can help plug leakages in subsidies
With subsidies bill increasing, danger of
missing fiscal targets is real in FY13
Survey pitches for hike in prices of diesel
and LPG to cut subsidy burden.
Foreign Exchange reserves remains steady
at $295.6 billion at December,2012-end
At present, overall energy deficit is about
8.6 percent and peak shortage of power is
about 9 per cent.
Infrastructure bottlenecks affecting
industrial sector performance
Prospects for world trade as well as of India
are still uncertain.
Pitches for further opening of sectors for FDI
PUBLIC PRIVATE PARTNERSHIP (PPPS):
ANALYSING THE FACTORS BEHIND THEIR GROWTH
The Term Public Private Partnership or PPP
has become a buzzword of late in the policy circles,
and is being increasingly resorted to as a preferred
medium for provisioning of public services both
within the industrialised and low-income countries.
While the PPPs are more commonly found in the
transport infrastructure sector, such as roads,
airports, and ports (primarily due to the commercial
pricing models), they are also invoked in water
supply and sanitation, tourism, education, health,
and other social sector programmes, albeit to a lesser
degree. A significant difference is however observed
in the nature of PPPs across these sectors. In many
cases they appear to be glorified forms of service
level agreements rather than partnerships as are
defined in the normative literature on PPPs.
Engagement with the private sector for
provisioning of infrastructure facilities has become
increasingly popular in the past few decades. India
too has joined the bandwagon of countries adopting
PPPs for delivery of services under various
infrastructure sectors. It is claimed that India has the
maximum number of projects within PPP in the
transport sector. Its experience in highways and
expressways has been substantial. All national
highways in the present phase of NHDP (National
Highways Development Programme) are being
implemented within PPP mode. Recently, the
empowered Group of Ministers on infrastructure has
decided that 95% of road projects in the current year
will be through PPP.
Several airports are being built with private
sector participation, while some metro-rail projects,
such as the Hyderabad metro, are also opting for this
approach rather than the traditional way of public
sector delivery. According to the Economic Survey
2010-2011, against a target of 30% of private sector
participation in infrastructure sector, the achieved
figure was 34%. An investment of USD 1 trillion has
been envisaged for infrastructure during the 12th
Plan: of this USD 500 billion is expected to be
contributed by the private sector. These figures
demonstrate the primacy given to private sector
participation at the policy level.
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Against this background, this article attempts
to provide theoretical insights into the concept of
PPP, and analyses the reasons for its growth and
acceptance as a mode of service delivery in many
countries.
Growth of PPPs
There have been instances of the State
engaging with the private sector towards
provisioning of public services throughout the
known history the case of Mathew private tax-
collector from the Bible; public street lamps in 18th
century England were cleaned by private contractors;
the rail companies of 19
th
century England and the US
were privately owned; 82% of Sir Frances Drakes fleet
of 197 vessels, which conquered the Spanish armada,
were owned by contractors. Toll roads and toll
bridges, privately owned and operated, has been
around since antiquity. Toll roads carry mention in
writings of the Greek historian and philosopher
Strabo (63 BC-AD 21) in Geographia during the time
of Caesar Augustus, where he records existence of
tolls on the Little Saint Barnard Pass. Historical
development of PPPs in infrastructure had its
beginning in Europe in the demand for mass travel
and long distance commerce in second half of 17
th
century. France pioneered the concession type model
in 17
th
century which was extensively used in the
19th century to finance and develop public
infrastructure.
However, Public Private Partnerships as are
known in their current form started in the
Organisation for Economic Co-operation and
Development (OECD) countries and the USA. These
gradually spread to the low-income countries.
Reliance on PPPs as a preferred mode of service
delivery rose to significant proportions during the
1990s, peaking around 1997. Governments under
Presidents Carter and Reagan in the USA and
Margaret Thatcher in UK promoted wide range of
partnerships at all levels of the State. Among all the
countries adopting PPPs, UK has had the maximum
number of projects implemented under the Public
Finance Initiative (PFI) initiated in 1992. PPPs have
been now included in legislation in many countries
such as the urban policy legislation of UK and USA,
industrial policies of France, and economic
development policies of Italy, Netherlands and UK.
While Netherlands Australia, Hungary, Italy, Japan:
Korea, Spain and France have had substantial
experience in implementing infrastructure projects
under PPP, countries like Chile, Brazil, Singapore,
India, and Canada are actively exploring this mode of
delivery of public services. PPPs form the core of
European Union (EU) initiatives for economic
competitiveness and are the preferred framework for
development of trans-European transportation.
Recently the European Commission has advocated
greater use of PPPs for provisioning of infrastructural
services and bringing in innovation in service
delivery.
Understanding the Context of PPPs
Different definitions and interpretations have
been associated with the term Public- Private
Partnerships. These depend upon the context within
which they are initiated and operated. Simply put, the
term PPP traditionally implies engaging with the
private sector for provisioning of public services and
infrastructure such as roads, airports, ports, health
services, garbage and waste management. Such
services have been historically provided by the
government through public works agencies.
According to some, PPP is a framework for describing
all cooperative ventures between the State and the
non-State agencies, both for profit and not-for-profit.
Within the limited context of transport infrastructure
sector, PPP is defined as a long term collaborative
effort between the government and private agencies,
wherein both pool in their differentiated and
specialised resources for planning, design,
construction operation and maintenance of
infrastructure services. They also share investments,
risks, benefits and responsibilities. This feature of the
PPP has been argued to form the crux of the
partnership. The facility thus developed eventually
reverts back to the government after expiry of the
concession period. In India this period ranges from 20
to 30 years.
A common misconception about PPPs is that
they involve the private sector merely for financial
partnering. However, PPPs are more about a service
procurement policy rather than a capital asset
management policy; they do not do away with public
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investment but merely supplement it. Within a PPP
the private partner is involved in a broader ambit of
infrastructure investment where neither the private
sector nor the government is the only owner.
PPPs are perceived to provide public services
more efficiently than what the government could
accomplish on its own. In the classical literature on
public administration, there is a distinct divide
between the roles and responsibilities between the
State and the private sector, often termed as the
market. While some works were to be taken up by
the government agencies due to their social and
economic mandate, some services were delivered by
the agencies. However, the traditional
conceptualisation of the state being the sole provider
of services and goods for public welfare came under
severe strain in the decades since 1970s. In the 1970s
and 1980s, as the demand for public infrastructure
grew and governments became increasingly fund
starved, due to deficit financing and populist
pressures to hold prices below costs, their capacity
to provide sufficient and quality infrastructure was
found to be inadequate. The public utilities were
therefore largely neglected.
In most of the developing low-income
countries it was found that public finance for
infrastructure was generally inadequate and full cost
recovery of infrastructure charges was becoming
more of an exception than a rule. In addition to poor
allocation of funds for development of infrastructure,
maintenance got even little, which was assumed to be
funded by future budgets which were typically
insufficient. Traditional methods also left a number of
risks with the public sector, regarding the asset
ownership. This is attributed to its monopoly position
with no incentive for competition, poor fiscal
discipline and limited fiscal autonomy to public
bodies and managerial inefficiency which increases
production cost. Many governments attempted to
improve performance through corporatisation and
performance contracts which were largely
unsuccessful.
SOCIAL SECTOR OUTLAYSAS ASSESSMENT
As Countrys most important resource are its
people, Finance Minister P Chidambaram said
quoting Joseph Stiglitz, and through his Budget
speech the finance minister spoke of the need to pay
special attention to the sections that had been left
behind. Yet when it came to making good on the talk,
the government fell short. Social sector-education,
health, sanitation, welfare, rural development-
allocations in Budget 2013-14 fails to convince
anyone that the government is seized of the
importance and urgent need to invest in the people.
This year, the total budget outlay for the social
sector, excluding in the non-Plan spending, saw a
modest increase in its share of the GDP-from 1.7% in
2012-13 revised estimates to 1.9% in 2013-14 budget
estimates. Going by past records, it is likely that total
social sector spending will see a downward revision
by the time the 2013-14 revised estimates are worked
out.
In its Twelfth Plan document, the government
has stated its intention to raise public expenditure to
2.5 per cent of GDP by 2017, when the plan period
comes to a close. Budget 2013-14 appears to do little
to achieve this goal. Spend on health accounts for
2.24 percent of the Budget. Extreme under
provisioning for health has somewhat become a
standard. Centres total expenditure on health as a
proportion of GDP has only marginally increased from
0.25 percent in 2003-04 to 0.33 percent in 2013-14. For
a country with a vast population, and a high level of
people who can be adjudged as poor, such paltry
spending on health is a cause of senous concern.
The countrys total expenditure on health
amounts to about 5 per cent of GDP, which would be
comparable with other developing countries at the
same level of per capita income. The lion share of the
spending on health is borne by private households
out of pocket expenditure, roughly between 70 to 80
per cent of total expenditure on health care. The low
level of public spending means that a large part of the
expenditure on health is borne by households from
their private resourcesincome and savings. This is
affects the poor most adversely. The low spend on
health has serious repercussions. A study in Indian
poverty by Anirudh Krishna of Duke University
found that rural expenditure on health is the primary
reason for families decline into poverty. The inability
to spend on health and the debts incurred for it are
factors that push families into poverty.
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The low level of funds for public health is an
indicator for another pillar of the governments
sustainable and sustained growth aim.
Environment is a key public health concern. The lack
of investment in public health rollout whether it is
through key programmes or health infrastructure will
also hinder the need for greater environmental
accountability from the people. Unlike last year there
has been no windfall for sanitation, this would further
hamper efforts to improve public health.
Many will argue that social sectors demand
for higher allocations is something of a fetish. It will
be argued that budgetary allocation for the social
sector increased from Rs 39,123 crore in 2004-05 to Rs
2,13,689 crore in 2013-14. And that public spending
(both centre and state) in the social sector increased
from 5.3 per cent of GOP in 2004-05 to 6.7 percent in
2011-12, and is around 7 percent of GOP in 2013-14.
While that might appear impressive, the fact is that
between 2001 and 2011, India added as many as 1.81
crore persons to its population, and this number is
likely to have gone up the last few years. Another
fact that needs to be kept in mind is that this
spending of Rs 2, 13, 689 crore accounts for
expenditure on education, youth affairs and sports,
art& culture, health & family welfare, water supply
and sanitation, housing and urban development,
information and broadcasting, welfare of scheduled
castes, scheduled tribes, and other backward classes,
labour and labour welfare, social welfare and nutrition,
women and child development and other social
services.
Indias spending on social sector, given the
magnitude of the need, has been consistently low.
After adjusting for inflation and taking into account
existing deficiencies in the social sector, it becomes
clear that budgetary allocations for key areas such as
education, health, sanitation, nutrition, rural
development has not gone up over the last few years.
The average social sector spending in developed
countries is to the tune of 14% of GDP.
In budget 2013-14, the two key development
indicators-education and health-did not fare too well.
Total central government allocation for education is
at 0.70 percent of the GDP, marginally up from 0.67
percent in 2012-13 (revised estimates) and down from
0.74 percent in last years budget. The spend on
health is a cause for concern-this year the health
budget increased by only Rs 2,842 crore over last
years budget estimates. Central government spend
on health is at 0.33 percent of GDP compared to 0.29
percent in 2012-13 revised estimates and down from
0.34 percent in the budget estimate for 2012-13. The
marginal increase in allocation is far too small to
address the large need in the two crucial sectors.
An important issue with direct feedback effect
on health-drinking water and sanitation- saw a modest
hike of Rs 2,260 crore in budgetary allocations over
the 2012-13 revised estimate of Rs 13,005.3 crore. The
increased allocation is nowhere what is required-only
43.5 percent of the population gets tap water supply
and 53.1 percent of households have no access to
toilets and defecate in the open. The health hazard-
both in the short and long-term-that this situation
presents is far from being addressed. Given the state
of healthcare, with its overdependence on private out
of pocket expenditure by households, the lack of
basic sanitation presents a serious problem. Not only
does it contribute to rural indebtedness, but affects
the productivity of human capital so central for
sustained economic growth.
There has been no move towards the promised
6 percent of GDP for education; total public spending
is yet to cross the 3.7 percent mark. According to the
Economic Survey, outlays on education was at 3.31
percent of GDP in the 2012-13 budget estimates.
Given the downward revision, the outlay is about 3.2
percent of GDP. Finance minister P Chidambaram
provided for Rs 27,258 crore for implementing the
Right to Education through the Sarva Shiksha
Abhiyan. Allocation is up by 6.6 percent over 25,555
crore provided last year, which had been revised to
Rs 23,645 crore. This years budgetary allocation is
nowhere near the Rs 39,115 crore that ministry for
human resource development had sought.
The Right to Education makes it compulsory
for the government to provide education to all
children between 6 and 14 years. Key standards-
classrooms, provisioning of drinking water and
toilets, teachers in accordance to the pupil-teacher
ratio-set out in the Act have to met by March 31 this
year. The drastic cut in outlay for the Sarva Shiksha
Abhiyan for 2012-13, and the failure to step up
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allocation in 2013-14 will present a problem. Meeting
and sustaining these requirements will entail a higher
outlay of funds. Failure to provide adequate funds in
the early years of implementation is likely to
endanger the effectiveness of the quality
interventions that the Right to Education proposes.
With more than 70 percent of the population
dependent on government-funded schooling, it is
essential to ensure that adequate funds are
implement the Right to Education this year. These
two factors would push up the demand for funds.
Not providing the required financial support could
stunt the goal of universalizing elementary education
and affecting the quality of human capital which
would have deleterious effect on growth.
There has been an increased dependence of
this elementary education programme on the 2 percent
cess levied in 2004-05. The share of cess in financing
the Sarva Shiksha Abhiyan has been going up. For
2013-14, the budget estimates set the share of the
education cess at 60.35 percent or Rs 16,453 crore, of
the total allocation of Rs 27,258 crore. The increased
share of the cess in financing elementary education
presents a concern, as it is not accompanied by a
commensurate increase in budgetary support, which
has been steadily declining. With the expenditure on
elementary education not showing signs of
stabilizing, the dependence on the levy to ensure that
the government can meet its constitutional
commitment should raise concerns.
This over reliance on the education cess along
with an increased push for private participation
through the public-private participation raises an
important question. This could be argued as signs of
withdrawal by the government from provisioning for
a key development indicator. This needs to checked.
Outsourcing the provision of education will not help;
public funding of education needs to be sustained.
Inclusive and sustained growth that the government
is pushing on paper can only be actualized if
spending in education, a key development indicator,
is increased substantially.
Another key area, which requires further
investment, especially in light of the Right to
Education Act, is teacher training. The Act mandates
all teachers need to complete and meet training
requirements within five years of the legislation being
force. However, budgetary allocation for
strengthening teacher-training institutes is constant
at Rs 450 crore. It needs to be said though in the
current year, the ministry was able to utilize only Rs
249 crore of the allocated Rs 450. The low level of
spend could explain the finance minister allocation in
Budget 2013-14. On the other hand, in the higher
education segment, there has been a substantial
increase in allocation for National Mission on
Teachers and Teachingfrom Rs5.27 crore in 2012-13
to Rs 217 crore in 2013-14. This is a welcome step.
Though teachers are a weak and crucial link in the
elementary education segment, it would heartening to
see a higher allocation and a roadmap for improving
both quality and quantity of teachers in the Budget.
Equally worrying is the fact that allocations for
several schemes that sought to address exclusion
have not risen, effectively meaning lower allocation.
Schemes like inclusive education for the disabled,
appointment of language teachers, womens hostels
in polytechnics and vocationalisation of education
have been affected.
The small but determined beginning has been
made in the higher education sectorRs 400 crore
has been allocated for the Rashtriya Uccha Shiksha
Abhiyan, a scheme geared at strengthening the state
universities and colleges. There has been a
significant scaling up of the funding for the Rashtriya
Madhyamik Shiksha abhiyan or the universalisation
of secondary schoolingRs 3,983 crore have been
provided, a 25.6 percent hike over the revised
estimates for 2012-13.
What makes Budget 2013-14 unsettling for the
education sector is that it fails to address critical
concerns of inadequate outlays in the elementary
school segment, unclear prioritization of sectors,
under utilization of funds in certain cases, and the
apparent withdrawal of the government. These are
issues that the government needs to address and
provide some clarity. The picture is dismal when it
comes to provisioning for the health sector. The
combined, centre and states, public spend remained
at around 1 percent of GDP in 2012-13. Indias public
provisioning for health falls far behind that of other
countries in the neighbourhood like China and Sri
Lanka. In China, healthcare accounted for 10.3
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percent of total public spending in 2009, and spend
on health was at 2.3 percent of GDP.
In2012-13, then finance minister Pranab
Mukherjee announced the launch of the National
Urban Health Mission to encompass the primary
health care needs of people in the urban areas, but no
allocation was made. This year the government has
moved towards universalisation of healthcareP
Chidambaram has allocated Rs 21,239 crore for the
new health mission, which merges the existing
National Rural Health Mission with the National
Urban Health Mission. Despite the expansion in
beneficiaries, the share of the mission in the total
budget shows a decline; the National Rural Health
Mission had an allocation of Rs 20,822 crore in
2012-13.
The budget has allocated Rs 4,727 crore for
medical education, training and research and Rs 150
crore for the National Programme for the Health Care
of Elderly and eight geriatric centres for the
development in the area of geriatric medicine. It has
also set aside Rs 1,650 crore for six AIIMS like
institutions.
The gap in health personnel and inequity in
health infrastructure continues to be critical.
Vacancies and shortfall plague the system. Vacancies
of doctors at the primary healthcare system rose from
17.5 percent in 2005 to 24.1 percent in 2011, while
shortfall of specialists rose from 45.7 percent in 2005
to 63.9 percent in 2011. An allocation of Rs 1023 crore
has been made for human resources in health care,
but the contours of the spending are not clear.
The inadequate provisioning for the social
sector, particularly education and health, needs to be
seen in the context of concerns about the resource
mobilization efforts of the government. In real terms,
it means that public provisioning for the social sector,
which is key for ensuring inclusive and sustainable
development, are likely to come under pressure.
Unfortunately, the Budget fails to provide any
concrete proposals for the addressing revenues
foregone due to tax exemptions. In his Budget
Speech, the finance minister acknowledged that India
has a low tax to GDP ratio.
That acknowledgement not withstanding, there
appears to be little in the Budget by way of
substantive proposals to increase the tax-GDP ratio.
The ratio of governments gross tax receipts is
projected to increase from 10.4 percent of GDP in the
2012-13 revised estimates to 10.9 percent of GDP in
2013-14.
The proposed income tax surcharge on the
super rich works out to a increase of 3 percent on the
peak tax rate, and doesnt do much to fill the gap.
Projections are that in 2025, over 70 percent of the
countrys population will be of working age. More
often than not, Indian leaders refer to Indias growing
population as demographic dividend, which
presents the country with a challenge and an
opportunity. In order to make good on this
demographic dividend, there is a need for higher
public spend in the social sector, especially key areas
of education, health and sanitation.
If the government is really interested in
leveraging this demographic dividend it needs to
move beyond rhetoric. A higher spend in the social
sector, particularly on both education and health, is
absolutely essential if the government is serious
about inclusive and sustained growth. Improving the
quality of the two key development indicators will
create the requisite pressure to ensure that the high
economic growth is both inclusive and sustainable.
A better-educated and healthy populace will mean
improved productivity.
There is a tendency to view social sector
spending as an outflow of resources-especially when
it comes to providing education or healthcare. A part
of this push for limiting public spend in these sectors
comes from those who call for greater privatization of
health and education. It would be a big mistake if the
government retreats any further from these sectors.
Investing in social sector segments like health and
education is key to growth.
Nearly 170 years ago, Russian thinker
Alexander Herzen asked If progress is the end, for
whom are we working? ... Do you truly wish to
condemn all human beings alive to-day to the sad role
of caryatids supporting a floor for others some day
to dance on ... or of wretched galley slaves, up to their
knees in mud, dragging a barge filled with some
mysterious treasure and with the humble words
progress in the future inscribed on its bows?
Herzens queryis relevant after all these years, and if
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the government really wants to ensure that growth
should be faster, sustainable and more inclusive
becomes more than just a pretty slogan, it will do well
to invest in its people focusing on the social sector.
INDIAS DEFENCE BUDJET
Just Days after India announced a $ 37.4 billion
defence budget for the year 2013-2014, China came
out with its own official defence budget figures- at $
119 billion, some three times its southern
neighbours. As late as 2000, Indias budget for its
armed forces at $15.9 billion more or less matched
Chinas officially given out figures. However, in reality
even then the actual Chinese spending was estimated
at three times Indias.
Today, the real Chinese defence budget is
believed by many, to be nearer 4-5 times Indias.
Indias defence budget rose by just 5 per cent, a sign
of the difficult economic times the world and India is
going through. Indias $ 1.9 billion economy grew at
its decadal low of 5 percent, its inflation rate rose
worryingly and its current account deficit or the
difference between the foreign exchange earned by a
country and spent by it, breached self-set limits.
However, the real difference is not just in the
money figures which the two Asian rivals have put
out, but in the way India and China will be spending
that money. India will continue to spend most of its
money on its Army with 99,708 crore or 49 per cent of
the defence budget, earmarked for the 1.2 million
strong land force. Air force will get the next big chunk
of money at Rs 57,503 crore. Navy the smallest
service will receive Rs 36,343 crore, while the Defence
Research and Development Organisation will get a
paltry Rs 10,610 crore and Indias Ordinance
Factories complex a tiny Rs 509 crore.
The Air Force has become the most favoured
wing of the defence ministry - With its share of the
defence budget going up from 24.9 per cent to 28.2
per cent. Not only that, its allocation for
modernisation has gone up by a whopping 30 per
cent from Rs 28,504 crore for 2011-2012 to Rs 37049
crore for 2012-2013. The Air force of course will be
going to town with a huge shopping list and needs
that money. Among other things, it needs to sign a
contract to buy 126 French. The Navy and Armys
modernisation plans have received cuts by 2.8 per
cent and 3.5 per cent respectively. Last year, some 31
per cent of the Rs 79,198 crore capital budget for the
defence forces had been earmarked for Indian Navy,
as part of a strategy to build up Indias outreach to
partly protect sea lanes used by its merchantmen,
especially energy tankers which feed Indias growing
appetite for crude oil and partly to counter Chinas
growing naval presence.
However, the real problem with Indian defence
spending is that it relies heavily on foreign weapon
purchases - compared to the Chinese who depend
more on domestic manufacture. This means India
gets a) fewer aircraft or tanks or weapons for the
money both countries spend. b) Their spares have to
be continuously bought and c) there is always a fear
of disruption of supplies because of the vagaries of
foreign relations.
While India has been busy buying the C 130J
Hercules heavy lift aircraft, China has been busy
producing its Y-20 heavy lift aircraft, with a maximum
payload of 66 tonnes and capable of flying 4,400 km.
The aircraft is based on Russia workhorse - the
Ilyushin series an still use old Russian engines and
is certainly not as sophisticated as the built Hercules.
Similarly, while India hankers for Chinook
helicopters, the Chinese have come out with the 13.8-
ton AC313 heavy lift helicopter. Unveiled last year,
this aircraft is a larger and modified version of the 7-
ton Zhi-8 medium transport helicopter that is a close
copy of the French SA 321 Super Frelon. China had
bought 13 of the French helicopters in the 1970s and
at least one was reportedly disassembled for study
and reverse-engineering.
India, despite its head-start in aircraft
manufacturing, having started making aircraft in the
1940s and jet engines in the 1950s, has proved itself
incapable of even reverse engineering the many
makes of aircraft it has bought and makes under
license. The story with tanks is no different. Despite
grand announcements, the Arjun main battle tank has
proven to be a flop story. Just under 50 of them have
been built and no regiment equipped with these home-
made tanks. India still depends on old Russian T-72s
and the slightly newer T-90s. Despite having
bought the 155 mm Bofors howitzer guns in the late
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1980s along with the technology, domestic politics,
saw projects to build them locally shelved for
decades. This year, at long last the Indian army has
placed orders with Ordinance Factory Board to build
114 of them with slight modifications.
Contrast this with the Chinese model. Besides,
the heavy lift aircraft, Beijing as successfully reverse
engineered ussias Sukhoi aircraft and Ameri stealth
technology. Its J-20 and J-31 aircraft may be doubted
by western analysts, but like most Chinese take-
aways these advanced fighter jets are likely to be
value for money products, though not as advanced
as their western counterparts.
Just one and half decade back, China, like India
was a major importer of weapons. However, in the last
decade and a half, it very consciously worked to
catch up .. It reverse engineered British missiles,
worked on Soviet era fighter jet platforms to work in
improvements.
It used students and scientists sent abroad on
exchange programmes to spy on rival systems, a few
of which were openly available, some commercially
buyable. It hired out-of-work Soviet weapons
scientists and specialists and restructured its own
defence research and production labyrinths.
The Middle Kingdom has also strategised by
coming up with innovative ideas to take on its arch
rival - the US - whose military size, strength and
spending - dwarfs everyone else. Beijing is believed
experimenting with bugs in telecom and power
equipment which could cause power and
communication systems in client countries to
collapse.
It has again reportedly trained armies of
hackers who can play havoc with computer based
command and control systems in a wide range of
areas and is perfecting satellite warfare capabilities to
take out the communication lines of the enemy. It has
also reportedly strategised on using low cost, small
yet very fast strike craft to disable enemy fleets
including aircraft carrier groups.
Despite this defence-industrial complex mo el
next door, Indias focus on indigenization is more than
missing in its annual budget. It has yet to fully realise
the potential for indigenous manufacture of high tech
weapons or for innovating new attack systems which
could be cheap or involve less high tech inputs.
Unlike the west, the private sector is hardly involved
in manufacturing weapon systems in India. India had
allotted just under Rs 90 crore in 2012-2013 for
projects under which Indian companies can design
and make advanced defence equipment. In the year
2013-14, that amount has been cut down to a measly
Rs 1 crore, possibly because the amount set aside for
2013 has been returned unused!
The private sector too has proved itself as yet,
incapable of meeting the challenges required to make
quality platforms needed by the armed forces. The
Mahindra& Mahindra manufactured Axe jeep
touted as Indias answer for a Future Infantry Combat
Vehicle failed its test and army officers still swear the
best vehicle they have used is the old, fuel-guzzling
1960s Jonga.
However, this could well change. Indian private
industry as lethargic as Indias public sector in doing
meaningful research or development, has started
using its new found cash reserves to buy up foreign
firms in technology areas where India needs to catch
up. Indias Tata group whose cars such as Indica and
Nano werent perceived to be among the best
technologically, has in the last decade bought
Jaguar- Land Rover, giving it access to world class
technology. Mahindras have similarly bought Korean
car-maker Ssangyong. Its cars are not considered
great in terms of design but are grudgingly accepted
as value for money, robust vehicles.
A joint venture Memorandum of
understanding inked earlier this year, between
Frances Dassault Aviation and Reliance Industries
Ltd will build components and eventually assemble
Falcon business jets in India. These are signs of
what may come about. If India can use this new
found confidence in its private sector and builds up
on the momentum by getting universities to work in
tandem with ordinance factories and the private
sector, its defence budget can literally earn more b g
for the rupee in the years ahead.
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HIGHLIGHTS OF THE BUDGET
The Union Budget for 2013-14 aims at higher growth rate leading to inclusive and sustainable
development as mool mantra.
Finance Minister makes three promises: to women, youth and the poor.
Nirbhaya Fund to empower women and to keep them safe and secure.
Proposal to set up Indias first Womens Bank as a public sector bank.
Rs. 1,000 crore for skill development of ten lakh youth to enhance their employability and
productivity.
Fiscal Deficit for 2013-14 is pegged at 4.8 percent of GDP. The Revenue Deficit will be 3.3 percent
for the same period.
Substantial rise in allocation to the social sector. Allocation for Rural Development Ministry raised
by46 percent to Rs. 80,194 crore.
The target for farm credit for 2013-14 has been set at Rs. 7,00,000 crore against Rs. 5,75,000 crore
during the current year.
Rs. 10,000 crore earmarked for National Food Security towards the incremental cost.
ICDS gets Rs. 17,700 crore. This is 11. 7 percent more than the current year.
Drinking water and sanitation will receive Rs. 15,260 crare. Rs. 1,400 crore is being provided for
setting up water purification plants to cover arsenic and fluoride affected rural areas.
Health and Family Welfare Ministry has been allotted Rs. 37,330 crore. National Health Mission
will get Rs. 21,239 crore which represents 24.3 percent over the RE.
The Jawaharlal Nehru National Urban Renewal Mission (JNNURM) will receive Rs. 14,873 crore as
against RE of Rs. 7,383 crore in the current year.
Defence has been allocated Rs. 2,03,672 crore.
Rs. 3,511 crore have been earmarked to Minority Affairs Ministry, 60 percent higher than RE for
2012-13.
Income limit under Rajiv Gandhi Equity Savings Scheme (RGESS) will be raised from Rs. 10 lakh to
Rs.12Iakh.
First home loan from a bank or housing finance corporation upto Rs. 251akh entitled to additional
deduction of interest upto Rs.1Iakh.
Technology Upgradation Fund Scheme (TUFS) for textile to continue in 12th Plan with an investment
target of Rs. 1,51,000 crare.
Rs.14,000 crore will be pravided to public sector banks for capital infusion in 2013-14.
A grant of Rs. 100 crore each has been made to 4 institutions of excellence including Aligarh
Muslim University, Banaras Hindu University, Tata Institute of Social Sciences, Guwahati and
Indian National Trustfor Art and Cultural Heritage (INTACH).
New taxes to yield Rs. 18,000 crore.
A surcharge of 10 percent on persons (other than companies) whose taxable income exceeds RS.1
crore have been levied.
Tobacco products, SUVs and Mobile Phones to cost more.
Relief of Rs. 2000 for the tax payers in the first bracket of 2 to 5lakhs.
Voluntary Compliance Encouragement Scheme launched for recovering service tax dues.
Rs. 9,000 crore earmarked as the first installment of balance of CST compensations to different
States/UTs.
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LAND USE AND AGRARAIN RELATIONS
L
and is a finite resource and there is
conflicting and competing demands on
it. For 80% of the world, agriculture land
is the primary source of life and livelihood. India
holds 2.4% of the worlds geographical area (328.73
mha) but supports 17.5% of the worlds population.
India is home to 18% of the cattle population of the
world while owning a mere 0.5% of the total grazing
area. Of the total 328 mha (total geographical area},
land- use statistics is available for approximately 305
mha (93%) of the total land. 228 million ha (69%) of
its geographical area falls within dry land that
encompasses arid, semi-arid, dry and sub-humid land
as per Thornthewaite classification.
India is blessed with a wide range of soil
pattern, each particular to the locale. The alluvial soil
(78 mha) that covers the great Indo- Gangetic Plains,
the valleys of the rivers Narmada and Tapti {Madhya
Pradesh), the Cauvery Basin (Tamil Nadu) supports
cereals, oil, pulses, potato and sugar cane. The Black
Cotton soil (51.8 mha) found in Maharashtra, Gujarat,
Madhya Pradesh, Uttar Pradesh, Karnataka,
Rajasthan and Andhra Pradesh supports cereals,
cotton, citrus fruits, pulses, oil seeds and vegetables.
The red soil of South India and Madhya Pradesh,
West-Bengal and Bihar supports rice, millets, tobacco
and vegetables. The laterite soil (12.6 mha) and desert
soil (37 mha) are not found suitable for agriculture.
Water is a resource precious and scarce in
India. The variability of precipitation spatially and in
quantity can be inferred by the fact that rainfall has
been recorded as low as 100 mm in West Rajasthan
and 9000mm in Meghalaya in North Eastern India.
India receives 4000 cubic kilometre of precipitation in
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KURUKSHETRA
the country in its 35 meteorological sub-divisions. Of
this amount, only 50% is put to benefit due to
topographical and other constraints. The fact that
water is crucial to agriculture in a country that has
68% of its net cultivated area as rain-fed, can hardly
be exaggerated. Of the total cultivated area of 142
mha, 97 mha is rainfed. The full irrigation potential of
the country has been revised to 139.5 mha out of
which 58.5 mha is watered by major and minor
irrigation schemes, 15 mha by minor irrigation
schemes and 40 mha by groundwater exploitation.
Indias irrigation potential increased from 22.6 mha
(1951) to 90 mha (1995-96) but water usage efficiency
is a meagre 30-40%. That is why more than 50% of the
total cultivated area is still rainfed. The state of soil
and water that mainly determine land and its utility in
agriculture is of prime importance to maintain
sustainable development. We need to define and
examine land use pattern with an emphasis on a
viable land use policy taking the above factors into
consideration.
Land degradation indicates temporary or
permanent long-term decline in ecosystem function
and productive capacity. It may refer to the
destruction or deterioration in health of terrestrial
ecosystems, thus affecting the associated
biodiversity, natural ecological processes and
ecosystem resilience. It also considers the reduction
or loss of biological/economic productivity and
complexity of croplands, pasture, woodland, forest,
etc.
LAND MANAGEMENT CAN
IMPROVE RURAL ECONOMY
Land degradation is increasing in severity and
extent in many parts of the world, with more than
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20% of all cultivated areas, 30% of forests and 10%
of grasslands undergoing degradation (Bai et al.,
2008). Millions of hectares of land per year are being
degraded in all climatic regions. It is estimated that 2.6
billion people are affected by land degradation and
desertification in more than a hundred countries,
influencing over 33% of the earths land surface
(Adams and Eswaran, 2000). This is a global
development and environmental issue highlighted at
the United Nations Convention to Combat
Desertification, the Convention on Biodiversity, the
Kyoto protocol on global climate change and the
millennium development goal (UNCED, 1992; UNEP,
2008).
The decline in land quality caused by human
activities has been a major global issue since the 20th
century and will remain high on the international
agenda in the 21st century (Eswaran et al., 2001). The
immediate causes of land degradation are
inappropriate land use that leads to degradation of
soil, water and vegetative cover and loss of both soil
and vegetative biological diversity, affecting
ecosystem structure and functions (Snel and Bot,
2003). Degraded lands are more susceptible to the
adverse effects of climatic change such as increased
temperature and more severe droughts.
Land degradation encompasses the whole
environment but includes individual factors
concerning soils, water resources (surface, ground),
forests (woodlands), grasslands (rangelands),
croplands (rain fed, irrigated) and biodiversity
(animals, vegetative cover, soil) (FAO, 2005). On the
other hand the NRC (1994) stressed that land
degradation is complex and involves the interaction
of changes in the physical, chemical and biological
properties of the soil and vegetation. The complexity
of land degradation means its definition differs from
area to area, depending on the subject to be
emphasized.
POVERTY IN INDIA
Poverty is one of the main problems which
have attracted attention of sociologists and
economists. It indicates a condition in which a person
fails to maintain a living standard adequate for his
physical and mental efficienty.
According to 2010 data from the United
Nations Development Programme, an estimated
37.2% of Indians live below the countrys national
poverty line. A recent report by the Oxford Poverty
and Human Development Initiative (OPHI) states that
8 Indian states have more poor than 26 poorest
African nations combined which totals to more than
410 million poor in the poorest African countries.
According to a new UN Millennium
Development Goals Report, as many as 320 million
people in India and China are expected to come out
of extreme poverty in the next four years, while Indias
poverty rate is projected to drop to 22% in 2015. The
report also indicates that in Southern Asia, however,
only India, where the poverty rate is projected to fall
from 51% in 1990 to about 22% in 2015, is on track to
cut poverty half by the 2015 target date. The latest
UNICEF data shows that one in three malnourished
children worldwide are found in India. 42 percent of
children under five were underweight. It also showed
that a total of 58 percent of children under five
surveyed were stunted. The 2011 Global Hunger
Index (GHI) Report ranked India 45th, amongst
leading countries with hunger situation. It also places
India amongst the three countries where the GHI
between 1996 and 2011 went up from 22.9 to 23.7,
while 78 out of the 81 developing countries studied,
including Pakistan, Nepal, Bangladesh, Vietnam,
Kenya, Nigeria, Myanmar, Uganda, Zimabwe and
Malawi, succeded in improving hunger condition.
CLASSIFICATION OF DRYLANDS
Dryland ecosystems are mainly categorised
into four subtypes according to aridity index and
annual rainfall levels into hyperarid, arid, semi-arid
and dry sub-humid areas..
World Drylands
Dryland ecosystems occupy over 41 per cent
of the earths land surface. Desertification affects 70
per cent of the world drylands, amounting to 3.6
billion ha or one-fourth of worlds land surface (IFAD,
1995).
Asia possesses the largest land area affected
by desertification, 71 per cent of which is moderately
to severely degraded. In Africa two-thirds of which is
desert or drylands. 73 per cent of agricultural
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drylands are moderately to severely degraded (IFAD,
1995). Africa is under greatest desertification threat,
with a rate of disappearance of forest cover of 3.5 to
5 million ha per year bearing down on both surface
and ground water resources and with half the
contents farmland suffering from soil degradation and
erosion.
Causes of Dryland Formation
Limited rainfall, poor soil quality, fragile
environments are the main factor behind dryland
formation. There is always water scarcity in drylands.
The dryness of drylands is due to negative balance
between mean annual precipitation and potential
evapotranspiration rates. Besides, limited rainfall, the
soils are of poor quality, low in organic matter, hence
less fertile. Harsh climates are another important issue
which limits crop diversification in drylands.
What makes the drylands a difficult
environment is not only less rainfall, but also its
erratic distribution. Inter-annual rainfall can vary from
20-100 per cent and periodic draughts are common
(Zurayk and Haider, 2002).
Problems of Drylands
Water scarcity due to limited rainfall, low soil
fertility, mostly deep sandy soil with poor water
holding capacity, shallow and rocky soils with low
organic matter content. Fragile environments with
unpredictable floods and droughts are other factors
limiting drylands to become productive ecosystems.
Lack of technologies limitation of resources and biotic
pressures contribute further in conversion of
drylands into deserts.
STRATEGY TO DEVELOP DEGRADED LAND
India has worlds 2% of geographical area and
1.5% of forest and pasture lands to support 18% of
worlds population and 15% of livestock population.
The increasing human and animal population has
been instrumental in the reduction in the availability
of land over the decades. While the per capita
availability of land has declined from 0.89 hectare in
1951 to 0.37 hectare in 1991 and is projected to
decline to 0.20 hectare in 2035, per capita agricultural
land has declined from 0.48 hectare to 0.16 hectare
and likely to decline to 0.08 hectare in respective
years.
Extent of Land Degradation
Agencies that have so far estimated land
degradation include National Commission on
Agriculture [1976], Society for Promotion of
Wasteland Developments [1984], National Remote
Sensing Agencies [1985], Ministry of Agriculture
[1985], National Bureau of Soil Survey and Land Use
Planning [1985 &2005]. The estimates on the extent
of land degradation in India vary widely from 63.9
million hectares to 187.0 million hectares due to
different approaches, methodologies, defining
degraded soils, adopting various criteria for
delineation, among others. However, one cannot
underestimate the challenging nature and extent of
land degradation in India. The National Bureau of Soil
Survey &Land Use Planning [NBSS&LUP] of the
ICAR, Nagpur in 2005 has reported that out of 328.60
million hectares of geographical area in India Net
Cultivated Area is about 141 million hectares [42.9%]
of which irrigated area is about 57 million hectares
[40.4%] and about 84 million hectares [59.6%] are
rainfed. Area of around 146.82 million hectares
[44.7%] out of 328.60 million hectares issuffering from
various kinds of land degradation. In absence of
comprehensive and periodic scientific surveys, the
figures reported by NBSS&LUP based on studies
and several estimates [2005] for various land
degradation have been considered as logically
concluded and are being used for various purposes.
Land degradation is caused by several factors
viz. water and wind erosion, water logging, salinity/
alkalinity, soil acidity, among others. India has been
experiencing a very high degree of land degradation
as 44.7% of its geographical area is classified as
degraded. Of this 93.68 million hectares [63.8%] are
affected by water erosion, 16.03 million hectares
[10.9%] by soil acidity, 14.30 million hectares [9.7%]
by water logging, 9.48 million hectares [6.5%] by wind
erosion, 5.94 million hectares [4.1%] by salinity/
alkalinity and 7.38 million hectares [5.0%] by complex
problems.
Across regions, all six regions had very high
percentage of geographical area as degraded ranging
from as high as 56.3% for Central region to 35.4% for
Northern region and even 29.5% for Delhi and Union
Territories. Among States, 11 States had extremely
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high percentage of geographical area degraded above
mean value of 44.7% ranging from 52.0% to 89.2% and
other 15 States too had significantly high percentage
of geographical area degraded varying from 25.4% to
43.9%. In particular Mizoram [89.2%] Himachal
[75.0%] Nagaland [60.0%] Madhya Pradesh and
Chhatisgarh combined [59.1%] were States with very
severe intensity of degradation.
Policy and Programs
Acknowledging the acute problem of land
degradation, the Government, in its efforts to sustain
ecological environment, agricultural productivity and
production, has initiated from time to time several
policies and programs to prevent land degradation on
one hand and take remedial measures to improve the
quality of degraded land on the other.
LAND ACQUSITION IN INDIA
NEED FOR A PARADIGM SHIFT
Land is the base for economic development
and poverty alleviation of a country. In recent years,
land acquisition for private sector projects and
Public-Private Partnership (PPP) projects like Singur,
Nandigram, Yamuna Expressway, POSCO, etc created
a lot of noise. Few lakhs crores rupees of investment
is hanging in balance in the country from both
domestic and Foreign Direct Investment (FDI)
sources because of failure of government to provide
land for the projects and also failure of the land-
market to provide sufficient land for development. Is
land acquisition process in India seriously flawed? Is
The Right to Fair Compensation Resettlement
Rehabilitation and Transparency in Land Acquisition
Bill 2012 (RFCRRTLA Bill 2012) solution to this
problem? Are land institutions of India not market
friendly in the post 1991 economic reform era? These
questions, which provide the basis for this paper, are
examined through field observation and field
experience of the authors.
Doctrine of Eminent Domain
The power of the sovereign state to acquire or
expropriate private property for public use/purpose is
driven from doctrine of Eminent Domain. The origin
of the term Eminent Domain can be traced to the
legal treatise written by the Dutch Jurist Hugo
Grotius in 1625 and described as follows:
The property of subjects is under the eminent
domain of the state, so that the state or he who acts
for it may use and even alienate and destroy such
property, not only in the case of extreme necessity, in
which even private persons have a right over the
property of others but for ends of public utility, to
which ends those who founded civil society must be
supposed to have intended that private end should
give way. But it is to be added that when this done
the state in bound to make good the loss to those
who lose their property.
Almost all sovereign states in the world have
law for land acquisition or expropriation. Pakistan and
Bangladesh are using the same Land Acquisition Act
1894 (LA Act 1894). Even through all sovereign state
are acquiring or expropriating private properties, why
land acquisition becomes a hindrance for economic
development in India? The fundamental conceptual
difference is defining the purpose of land acquisition:
public use Vs public purpose. Most of the western
countries acquire land for public use like roads,
public safety, health, etc and not for the project in
which private profit motive is involved even though
project has public purpose. On the other hand in UK
common law system, land is acquired for public
purpose, which is followed throughout all
Commonwealth Nations including India.
In Indian Jurisprudence also, when LA Act
1894 was enacted public purpose included in the
definition was roads, canals and social purpose of
state-run schools and hospitals. By an amendment in
1933, railway companies were included in public
purpose. But the amendments introduced in 1984 in
the LA Act 1894 by amending section of the original
act to insert the words or for a Company after any
public purpose. This opened the floodgates to
acquisition of land by the state for private and public
sector companies and again this is embellished in the
proposed bill. If we put ban on land acquisition for
private projects and PPP project with present land
system in India, we strongly believe, the economic
development of India will be seriously affected
because of inherent problem in our land institutions.
Land System of India
The problem of land acquisition in India can be
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better appreciated by understanding the land system
of India. -Modern day land system of India has its
base from the land revenue system introduced by
Akbars revenues minister Todar Mal. The salient
features of Todar Mals systems were measurement of
land, classification of land and fixation of rates (Appu
1996). After the decline of Mughal dynasty, East
India Company and the British Raj were established
extractive land institutions on the Todar Mal principle
called Zamindhari system, Mahalwari system and
Raiyatwari system to extract maximum land revenue
from peasants, which was the major source of
revenue. In the Zamindari area, British had not hold
elaborate administrative arrangement and lowest
functionary level was sub-divisional level and no
proper land records maintained either by British
administration or by Zamindars. Only land record
maintained was land record created- after each survey
and settlement operation and again by revisional
settlement. Because of this reason, elsewhere
Zamindari area does not have proper land records
and weak administration. In Mahalwari areas, the
land revenues were fixed for each or group of villages
in which one family or person who was responsible
to collect and pay land revenue.
The Raiyatwari system covered the erstwhile
Madras (except North Madras) and Bombay
Presidencies and part of the central provinces and
Barer. The Raiyatwari System was based on the
assessment of land revenue on sight fields or
holdings, surveyed, numbered and marked out on the
ground (Appu 1996). Because of elaborate
arrangement for revenue collection and
administrative step created during British Raj, these
areas of India is having better land records than rest
of India even today. Another wisdom of British was
creation of primitive land institutions in excluded and
partially excluded areas to separate tribal and others
deprived people of these areas with plain and Hindu
population by perpetuating divide and rule policy.
This primitive land institutions created by British was
responsible for creation of Scheduled V and VI areas
and poverty and deprivation of these regions.
During the first four five year plan periods,
India introduced radical land reform on socialism
land reform model to increase agricultural production
and to provide social justice without any role for
market forces. During this land reform period, there
was no respect for private property rights and no
land institutions was created for allocation land
resources for industrialisation and urbanisation
through market forces. Till date, land system of India
is suited for subsistence agriculture using manual
labour and does not have major provision for
industrialisation, urbanisation and mining activities.
By introducing Zaminidari abolition law and ceiling
law on agriculture land and also on urban land into
the Indias land system, Indian land holding become
too small and restriction on transfer and lease, which
further reduced the size of holding. In the name of
distribution of government land and redistribution of
surplus land, we distributed waste land, barren land
and dry land for agriculture which could have been
kept as construction land. This led to non-availability
of large plots of land in thousands of acres for
industrialisation and urbanisation.
WASTEDLAND DEVELOPMENT
INITIATIVES A REVIEW
The burgeoning population growth of India
coupled with rapid urban development has led to an
increasing demand on the countrys land resources.
An indication of this burden on the natural resources
is a simple comparison between Indias share in total
world land area and in the total world population.
While the former is a meagre 2 per cent of the world
geographical area, the latter constitutes 16 per cent of
worlds population. Land resources provide
livelihood to two-thirds of Indias population. The
increasing pressure on land, relentless exploitation of
this valuable resource for agricultural and allied,
housing, industrial and manufacturing activities has
made the productive farm lands less productive,
leading to its constant degradation.
The total geographical area of the country is
around 329 million hectares out of which only 264
million hectares (80 percent) are fit for vegetation.
While 142 million hectares are covered under all
types of crops, 67 million hectares of land are under
forest cover and 68.35 million hectare area of land is
lying as wastelands in India. The Government of
India (Gol) defines wastelands as the degraded land
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which is currently under-utilised and can be brought
under vegetative cover, with reasonable effort by
resorting to effective and appropriate water and soil
management.
It is estimated that approximately half of the
wastelands in India which are not covered under
forests of any kind can be made productive if treated
properly. It is the unprotected and unpreserved non-
forestlands, which are subjected to constant
degradation. The tremendously increasing biotic
pressure on the land resources, in the last six
decades, have promoted deforestation and done
irreversible damage to the soil and environment. Land
degradation is not only impacting the livelihoods of
the land-dependent communities but also disrupting
the ecosystem as a whole. Keeping this in view the
government created the Department of Wasteland
Development (presently renamed as Department of
Land Resources) in July 1992 under the Ministry of
Rural Development to restore ecological imbalance
through development of degraded non-forest
wastelands.
Status of Wasteland in India
The status of wastelands in India between
1986-2000 and 2003 is highlighted. During 1986-2000,
6.38 lakh square KMs of land was categorised as
total wasteland. This fell by 2.71 per cent by 2003. As
can be seen from the Table, there were 5.52 lakh
square KMs of land which required treatment to
become productive. While wastelands under the
category of sands (either in the coastal region or
inland), shifting cultivation, degraded notified
forestland witnessed a sharp fall, the wastelands in
the category of mining and industrial and steep
sloping areas increased.
Government Intervention
In 1985, the government created the National
Wasteland Development Board (NWDB) under the
Ministry of Forests and Environment with a view to
tackle the problem of degradation of lands,
restoration of ecology and to meet the growing
demands of fuel wood and fodder at the national
level. In 1992, the NWDB was reconstituted and
placed under the Ministry of Rural Development,
where emphasis was laid on treating wastelands in
non-forest areas with active involvement of the
community. The programmes designed and
implemented by this Board aimed at improving
productivity of waste and degraded lands.
Gist of Press Information Bureau 49
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Gist of
PRESS INFORMATION BUREAU
GLOBAL HUNGER INDEX, 2012
T
he report Global Hunger Index (GHI)
2012 by the International Food Policy
Research Institute (IFPRI) is based on
three equally weighted indicators, namely
undernourishment (proportion of undernourished
people as percentage of population), child
underweight and child mortality. This report mentions
that India has lagged behind in improving its GHI
score despite strong economic growth along with the
statement that GHI data is based partly on outdated
data.The approach in dealing with the nutrition
challenges has been two pronged: First is the Multi-
sectoral approach for accelerated action on the
determinants of malnutrition in targeting nutrition in
schemes/ programmes of all the sectors. The second
approach is the direct and specific interventions
targeted towards the vulnerable groups such as
children below 6 years, adolescent girls, pregnant
and lactating mothers. The Government has accorded
high priority to the issue of malnutrition especially
among children and women including young girls and
is implementing several schemes/programmes
through State Governments/UT Administrations. The
schemes/programmes include the Integrated Child
Development Services (ICDS), National Rural Health
Mission (NRHM), Mid-Day Meal Scheme, Rajiv
Gandhi Scheme for Empowerment of Adolescent Girls
(RGSEAG) namely SABLA, Indira Gandhi Matritva
SahyogYojna (IGMSY) as direct targeted
interventions. Besides, indirect multi-sectoral
interventions include Targeted Public Distribution
System (TPDS), National Horticulture Mission,
National Food Security Mission, Mahatma Gandhi
National Rural Employment Guarantee Scheme
(MGNREGS), Nirmal Bharat Abhiyan, National Rural
Drinking Water Programme etc. All these schemes
have potential to address one or other aspect of
Nutrition. This was stated by Smt. Krishna Tirath,
Minister for Women and Child Development, in a
written reply to the Lok Sabha today.
PANEL ON CLIMATE CHANGE
The Government has constituted the Executive
Committee on Climate Change consisting of
representatives of various Ministries and agencies
under the Chairmanship of Principal Secretary to
Prime Minister to monitor the implementation of eight
national missions and other initiatives on climate
change and assist the Prime Ministers Council on
Climate Change in evolving a coordinated response
to climate change related issues at the national level.
This was stated by Shrimati Jayanthi Natarajan
Minister of State (Independent Charge) for
Environment and Forests, in the Lok Sabha today, in
a written reply to a question by Shri Pralhad Joshi &
Shri S.S. Ramasubbu. The Executive Committee
comprises, inter alia, of the representatives of the
Cabinet Secretariat, the Planning Commission, and
the Ministries/ Departments of Power, New and
Renewable Energy, Urban Development, Water
Resources, Science and Technology, Agriculture &
Cooperation, Agriculture Research and Education,
Earth Sciences, Coal, Petroleum and Natural Gas,
Economic Affairs, and Environment and Forests.
Functions of the Committee include, inter alia,
advising the PMs Council on Climate Change on
modifications, as may be necessary, in the objectives,
strategies and structures of the missions and
coordinating with various agencies on issues relating
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to climate change. The Minister further stated that
National Missions under the National Action Plan on
Climate Change (NAPCC) include appropriate
deliverables and timelines for monitoring of their
implementation. These are regularly reviewed from
time to time through the institutional mechanism laid
down in the NAPCC.
HUMAN DEVELOPMENT INDEX
The latest Human Development Index (HDI)
2011 prepared by the UNDP ranks India at 134 out of
187 countries and its HDI is shown as 0.547 which is
an improvement of 5.39% (HDI was 0.519 in 2010 HDI
part). The health aspects are reflected in life
expectancy at birth which is shown as 65.4 year in
HDI 2011 against 64.4 year in HDI 2010. High IMR
and Under 5 MR are the major factors in lowering
Life Expectancy at Birth. MMR also needs
improvement. A target of 25/1000 for IMR and 1000/
100,000 live births for MMR has been prescribed by
the 12 Five Year plan document for the end of 2017.
Some of the steps taken under NRHM for improving
the situation are:
Regular ANC care at health facilities and
home visits by ASHA
Personalized monitoring of pregnant women,
the new born and the post partum woman
through MCTS
Promotion of institutional delivery through
JSY, increase in delivery points and
improvement in referral transport.
JSSK
Increase in number of SNCU for managing
preterm and sick neonates
Promotion of exclusive breast feeding
Reduction in incidence of diarrhoea through
improvement in hygiene by measures such
as hand washing and management of
diarrhoea through Zinc and ORS
supplementation.
Extension of immunization coverage
The various disease control programs
against Malaria, Kala Azar, filaria, TB
(RNTCP) etc have improved the burden of
disease and mortality due to major infectious
diseases in all stages of life.
In order to tackle the impact of Non-
communicable diseases, Government of
India has launched the National Programme
for prevention and control of cancer,
Diabetes, Cardiovascular Diseases and
stroke (NPCDCS) in 2010 in 100 districts of
21 States with a focus on an awareness
generation for behaviour and life style
changes, early diagnosis and referral to
higher facilities for appropriate management.
It has also been envisaged to build capacity
at various levels of health care systems for
prevention, diagnosis and treatment of
NCDs.
MILLENNIUM DEVELOPMENT GOALS
The Millennium Development Goals (MDGs)
adopted during the U.N. Millennium Summit, 2000 by
189 countries including India consists of eight goals
which are sought to be achieved during the period
1990 to 2015.
The Millennium Development Goal (MDG) -1 is
regarding Eradication of Extreme Poverty and Hunger,
which have 2 targets namely, (i) Halve, between 1990
and 2015, the percentage of population below the
National Poverty Line and (ii) Halve, between 1990
and 2015, the proportion of people who suffer from
hunger. The indicator for measuring target two is the
prevalence of underweight children under three years
of age. Thus from the estimated 52% in 1990, the
proportion of underweight children below 3 years is
required to be reduced to 26% by 2015. All-India
trend of the proportion of underweight children
below 3 years of age shows India is going slow in
eliminating the effect of malnourishment as the
prevalence of underweight has declined by 3
percentage points during 1998-99 to 2005-06 , from
about 43 percent to about 40 percent (as per the
National Family Health Survey, 2005-06). At this
historical rate of decline the proportion of
underweight children is expected to come down to
about 33% only by 2015 vis--vis the 2015 target
level of 26% falling short of the target. The problem
of malnutrition is complex, multi-dimensional and
inter-generational in nature, and cannot be improved
by a single sector alone. Poverty and hunger along
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with household food insecurity, illiteracy and lack of
awareness especially in women, access to health
services, availability of safe drinking water, sanitation
and proper environmental conditions are some of the
determinants of malnutrition. In fact, improvement in
malnutrition is linked to achievement of six of the
Millennium Development Goals.
The approach in dealing with the nutrition
challenges has been two pronged: First is the Multi-
sectoral approach for accelerated action on the
determinants of malnutrition in targeting nutrition in
schemes/ programmes of all the sectors. The second
approach is the direct and specific interventions
targeted towards the vulnerable groups such as
children below 6 years, adolescent girls, pregnant
and lactating mothers. The Government has accorded
high priority to the issue of malnutrition especially
among children and women including young girls and
is implementing several schemes/programmes
through State Governments/UT Administrations
including Gujarat, Madhya Pradesh and Uttar
Pradesh. The schemes/programmes include the
Integrated Child Development Services (ICDS),
National Rural Health Mission (NRHM), Mid-Day
Meal Scheme, Rajiv Gandhi Scheme for Empowerment
of Adolescent Girls (RGSEAG) namely SABLA, Indira
Gandhi Matritva Sahyog Yojana (IGMSY) as direct
targeted interventions.
Besides, indirect multi-sectoral interventions
include Targeted Public Distribution System (TPDS),
National Horticulture Mission, National Food Security
Mission, Mahatma Gandhi National Rural
Employment Guarantee Scheme (MGNREGS), Nirmal
Bharat Abhiyan, National Rural Drinking Water
Programme etc. All these schemes have potential to
address one or other aspect of Nutrition. Recently
Government has approved the strengthening and
restructuring of ICDS with special focus on pregnant
and lactating mothers and children under three. The
restructured and strengthened ICDS will be rolled
out in three phases with focus on the 200 high burden
districts for malnutrition during 2012-13 (which
includes 15 districts in Gujarat, 27 districts in Madhya
Pradesh and 41 districts in Uttar Pradesh); additional
200 districts in 2013-14 including districts from the
special category States and NER and the remaining
districts in 2014-15. Further, an Information Education
and Communication Campaign (IEC) to generate
awareness against malnutrition has been launched in
the country including Gujarat, Madhya Pradesh and
Uttar Pradesh . This was stated by Smt. Krishna
Tirath, Minister for Women and Child Development,
in a written reply to the Lok Sabha today.
PLANNING COMMISSION
HOSTING GOOGLE HANGOUT
The Planning Commission, along with the
National Innovation Council, is hosting its first
Google Hangout on the 12th Five Year Plan on 15th
March 2013 at 5 PM. The hour long session on
Google Hangout will be attended by Dr. Montek
Singh Ahluwalia, Deputy Chairman, Planning
Commission, Sh. Sam Pitroda, Chairman, National
Innovation Council, Members and the Secretary of
the Planning Commission who will answer questions
from the public and from a panel invited to attend the
Hangout. The aim through this interaction is
communicate the 12th Five Year Plan through social
media platforms to enhance public participation and
citizen engagement.
The Google Hangout takes forward the
inclusive process followed by the Commission in
formulating the Plan. In formulating the 12th Five Year
Plan, the Planning Commission consulted much more
widely than ever before, underlining the need for a
more inclusive and interactive approach. During this
process, inputs were provided by over 950 civil
society organisations, multiple business
associations, all State Governments, as well as local
representative institutions and unions. The Plan has
been approved by the National Development Council
and the aim now is to share its vision with the
countrys citizens.
This is a first step in leveraging social media
for engagement on the 12th Five Year Plan and over
the next few months, the Planning Commission will
publicise the content of the Plan on several other
social media channels, including Facebook, Twitter,
Google+ and YouTube on which it already has a
presence. The details of the event are available on
www.innovationcouncil.gov.in and the event will be
streamed live via www.youtube.com/PlanComIndia on
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15th March at 5 PM. More details of the event will be
made available via the Twitter handles of Planning
Commission (@PlanComIndia) and Mr. Sam Pitroda
(@pitrodasam).
IMPLEMENTATION OF BRGF PROGRAMME
This Ministry of Panchayati Raj is tasked with
the implementation of the Backward Regions Grant
Fund (BRGF) Programme as per Governments policy
of ensuring balanced development. The BRGF
Programme is designed to redress regional
imbalances in development of 272 identified
backward districts in the country. The funds there
under provide financial resources for supplementing
and converging existing developmental inflows into
identified districts so as to bridge critical gaps in local
infrastructure and other development requirements.
As per the BRGF Guidelines, the Annual Action
Plans prepared by the Panchayats and Urban Local
Bodies (ULBs) are consolidated into the District Plans
by the respective District Planning Committees which
are then forwarded to the Ministry of Panchayati Raj,
Government of India, by the respective State
Governments for releasing the funds as per eligibility
of the districts. A statement showing funds released
and utilised by the States under the BRGF
Programme during the last three years and current
year is at Annex-1.The complaints received regarding
misuse of Backwards Regions Grant Funds (BRGF)
are forwarded to the concerned State Governments
for taking necessary action. A list of complaints
received during the current year is at Annex-2. The
Ministry of Panchayati Raj insists that auditing of
Panchayats funds/ works under BRGF Programme is
done and Audit Reports are submitted along with
other necessary documents for release of funds. The
audit is to be done either by Local Fund Auditors or
by Chartered Accountants listed in the panel of the
State Government or AGs of the State.
This information was given by the Minister of
Panchayati Raj Shri V. Kishore Chandra Deo in a
written reply in the Rajya Sabha today.
GISAT
Indian Space Research Organisation (ISRO) is
designing a GEO Imaging Satellite (GISAT).
GISAT will carry a GEO Imager with multi-
spectral (visible, near infra-red and thermal), multi-
resolution (50m to 1.5 km) imaging instruments.
GISAT will be placed in geostationary orbit of 36,000
km. The remote sensing satellites launched by ISRO
revisit the same area once in every 2 to 24 days and
acquire images of a geographical strip (swath) at
different spatial resolution (360 meter to better than
1 meter). GISAT will provide near real time pictures of
large areas of the country, under cloud free
conditions, at frequent intervals. That is, selected
Sector-wise image every 5 minutes and entire Indian
landmass image every 30 minutes at 50m spatial
resolution. The total financial outlay for the project is
392 crore excluding the launch cost. The amount
spent up to March 2012 is 9.9 crore and BE provision
of 50 crore is made for the year 2012-2013. GISAT is
planned to be launched during 2016-17.
APPOINTMENTS MADE TO THE 20
TH
LAW COMMISSION OF INDIA
The Government has appointed Shri Justice
S.N. Kapoor, retired Judge of Delhi High Court, as a
full-time Member of the 20th Law Commission of
India with effect from the forenoon of 15th March,
2013 and up to 31st August, 2015 i.e. till the end of its
term. Prof. (Dr.) Mool Chand Sharma, Vice Chancellor,
Central University of Haryana, has also been
appointed as full-time Member. As per the
Notification issued by the Government, Prof. (Dr.)
Yogesh Tyagi, Dean & Professor of Law, South Asian
University, New Delhi; and Shri R. Venkataramani,
Senior Advocate, Supreme Court of India, have been
appointed as Part-time Members of the 20th Law
Commission of India with effect from the date they
assume charge and up to 31st August, 2015. The
Twentieth Law Commission was constituted through
a Government Order with effect from 1st September,
2012. It has a three-year term, ending on 31st August,
2015. Shri Justice D. K. Jain, Former Judge of the
Supreme Court of India, is the Chairman of the
Commission.
5TH BRICS SUMMIT - ETHEKWINI
DECLARATION AND ACTION PLAN
We, the leaders of the Federative Republic of
Brazil, the Russian Federation, the Republic of India,
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the Peoples Republic of China and the Republic of
South Africa, met in Durban, South Africa, on 27
March 2013 at the Fifth BRICS Summit. Our
discussions took place under the overarching theme,
BRICS and Africa: Partnership for Development,
Integration and Industrialisation. The Fifth BRICS
Summit concluded the first cycle of BRICS Summits
and we reaffirmed our commitment to the promotion
of international law, multilateralism and the central
role of the United Nations (UN). Our discussions
reflected our growing intra-BRICS solidarity as well
as our shared goal to contribute positively to global
peace, stability, development and cooperation. We
also considered our role in the international system
as based on an inclusive approach of shared
solidarity and cooperation towards all nations and
peoples.
We met at a time which requires that we
consider issues of mutual interest and systemic
importance in order to share concerns and to develop
lasting solutions. We aim at progressively developing
BRICS into a full-fledged mechanism of current and
long-term coordination on a wide range of key issues
of the world economy and politics. The prevailing
global governance architecture is regulated by
institutions which were conceived in circumstances
when the international landscape in all its aspects
was characterised by very different challenges and
opportunities. As the global economy is being
reshaped, weare committed to exploring new models
and approaches towards more equitable development
and inclusive global growth by emphasising
complementarities and building on our respective
economic strengths.
We are open to increasing our engagement and
cooperation with non-BRICS countries, in particular
Emerging Market and Developing Countries
(EMDCs), and relevant international and regional
organisations, as envisioned in the Sanya
Declaration. We will hold a Retreat together with
African leaders after this Summit, under the
theme,Unlocking Africas potential: BRICS and
Africa Cooperation on Infrastructure.The Retreat is
an opportunity for BRICS and African leaders to
discuss how to strengthen cooperation between the
BRICS countries and the African Continent.
Recognising the importance of regional
integration for Africas sustainable growth,
development and poverty eradication, we reaffirm our
support for the Continents integration processes.
Within the framework of the New Partnership
for Africas Development (NEPAD), we support
African countries in their industrialisation process
through stimulating foreign direct investment,
knowledge exchange, capacity-building and
diversification of imports from Africa. We
acknowledge that infrastructure development in
Africa is important and recognise the strides made by
the African Union to identify and address the
continents infrastructure challenges through the
development of the Programme for Infrastructure
Development in Africa (PIDA), the AU NEPAD Africa
Action Plan (2010-2015), the NEPAD Presidential
Infrastructure Championing Initiative (PICI), as well
as the Regional Infrastructure Development Master
Plans that have identified priority infrastructure
development projects that are critical to promoting
regional integration and industrialisation. We will
seek to stimulate infrastructure investment on the
basis of mutual benefit to support industrial
development, job-creation, skills development, food
and nutrition security and poverty eradication and
sustainable development in Africa. We therefore,
reaffirm our support for sustainable infrastructure
development in Africa.
We note policy actions in Europe, the US and
Japan aimed at reducing tail-risks in the world
economy. Some of these actions produce negative
spillover effects on other economies of the world.
Significant risks remain and the performance of the
global economy still falls behind our expectations. As
a result, uncertainty about strength and durability of
the recovery and the direction of policy in some
major economies remains high. In some key countries
unemployment stays unusually elevated, while high
levels of private and public indebtedness inhibit
growth. In such circumstances, we reaffirm our strong
commitment to support growth and foster financial
stability. We also underscore the need for appropriate
action to be taken by advanced economies in order
to rebuild confidence, foster growth and secure a
strong recovery.
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Central Banks in advanced economies have
responded with unconventional monetary policy
actions which have increased global liquidity. While
this may be consistent with domestic monetary policy
mandates, major Central Banks should avoid the
unintended consequences of these actions in the
form of increased volatility of capital flows, currencies
and commodity prices, which may have negative
growth effects on other economies, in particular
developing countries.
We welcome the core objectives of the Russian
Presidency in the G20 in 2013, in particular the efforts
to increased financing for investment and ensure
public debt sustainability aimed at ensuring strong,
sustainable, inclusive and balanced growth and job
creation around the world. We will also continue to
prioritise the G20 development agenda as a vital
element of global economic stability and long-term
sustainable growth and job creation.
Developing countries face challenges of
infrastructure development due to insufficient long-
term financing and foreign direct investment,
especially investment in capital stock. This constrains
global aggregate demand. BRICS cooperation
towards more productive use of global financial
resources can make a positive contribution to
addressing this problem. In March 2012 we directed
our Finance Ministers to examine the feasibility and
viability of setting up a New Development Bank for
mobilising resources for infrastructure and
sustainable development projects in BRICS and other
emerging economies and developing countries, to
supplement the existing efforts of multilateral and
regional financial institutions for global growth and
development. Following the report from our Finance
Ministers, we are satisfied that the establishment of
a New Development Bank is feasible and viable. We
have agreed to establish the New Development Bank.
The initial contribution to the Bank should be
substantial and sufficient for the Bank to be effective
in financing infrastructure.
In June 2012, in our meeting in Los Cabos, we
tasked our Finance Ministers and Central Bank
Governors to explore the construction of a financial
safety net through the creation of a Contingent
Reserve Arrangement (CRA) amongst BRICS
countries. They have concluded that the
establishment of a self-managed contingent reserve
arrangement would have a positive precautionary
effect, help BRICS countries forestall short-term
liquidity pressures, provide mutual support and
further strengthen financial stability. It would also
contribute to strengthening the global financial safety
net and complement existing international
arrangements as an additional line of defence. We are
of the view that the establishment of the CRA with an
initial size of US$ 100 billion is feasible and desirable
subject to internal legal frameworks and appropriate
safeguards. We direct our Finance Ministers and
Central Bank Governors to continue working towards
its establishment.
We are grateful to our Finance Ministers and
Central Bank Governors for the work undertaken on
the New Development Bank and the Contingent
Reserve Arrangement and direct them to negotiate
and conclude the agreements which will establish
them. We will review progress made in these two
initiatives at our next meeting in September 2013.
We welcome the conclusion between our
Export-Import Banks (EXIM) and Development
Banks, of both the Multilateral Agreement on
Cooperation and Co-financing for Sustainable
Development and, given the steep growth trajectory
of the African continent and the significant
infrastructure funding requirements directly
emanating from this growth path, the Multilateral
Agreement on Infrastructure Co-Financing for
Africa.
We call for the reform of International Financial
Institutions to make them more representative and to
reflect the growing weight of BRICS and other
developing countries. We remain concerned with the
slow pace of the reform of the IMF. We see an urgent
need to implement, as agreed, the 2010 International
Monetary Fund (IMF) Governance and Quota
Reform. We urge all members to take all necessary
steps to achieve an agreement on the quota formula
and complete the next general quota review by
January 2014. The reform of the IMF should
strengthen the voice and representation of the
poorest members of the IMF, including Sub-Saharan
Africa. All options should be explored, with an open
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mind, to achieve this. We support the reform and
improvement of the international monetary system,
with a broad-based international reserve currency
system providing stability and certainty. We welcome
the discussion about the role of the SDR in the
existing international monetary system including the
composition of SDRs basket of currencies. We
support the IMF to make its surveillance framework
more integrated and even-handed. The leadership
selection of IFIs should be through an open,
transparent and merit-based process and truly open
to candidates from the emerging market economies
and developing countries.
We emphasise the importance of ensuring
steady, adequate and predictable access to long term
finance for developing countries from a variety of
sources. We would like to see concerted global effort
towards infrastructure financing and investment
through the instrumentality of adequately resourced
Multilateral Development Banks (MDBs) and
Regional Development Banks (RDBs). We urge all
parties to work towards an ambitious International
Development Association(IDA)17 replenishment.
We reaffirm our support for an open,
transparent and rules-based multilateral trading
system. We will continue in our efforts for the
successful conclusion of the Doha Round, based on
the progress made and in keeping with its mandate,
while upholding the principles of transparency,
inclusiveness and multilateralism. We are committed
to ensure that new proposals and approaches to the
Doha Round negotiations will reinforce the core
principles and the developmental mandate of the
Doha Round. We look forward to significant and
meaningful deliverables that are balanced and
address key development concerns of the poorest
and most vulnerable WTO members, at the ninth
Ministerial Conference of the WTO in Bali.
We note that the process is underway for the
selection of a new WTO Director-General in 2013. We
concur that the WTO requires a new leader who
demonstrates a commitment to multilateralism and to
enhancing the effectiveness of the WTO including
through a commitment to support efforts that will
lead to an expeditious conclusion of the DDA. We
consider that the next Director-General of the WTO
should be a representative of a developing country.
We reaffirm the United Nations Conference on
Trade and Developments (UNCTAD) mandate as
the focal point in the UN system dedicated to
consider the interrelated issues of trade, investment,
finance and technology from a development
perspective. UNCTADs mandate and work are
unique and necessary to deal with the challenges of
development and growth in the increasingly
interdependent global economy. We also reaffirm the
importance of strengthening UNCTADs capacity to
deliver on its programmes of consensus building,
policy dialogue, research, technical cooperation and
capacity building, so that it is better equipped to
deliver on its development mandate.
We acknowledge the important role that State
Owned Companies (SOCs) play in the economy and
encourage our SOCs to explore ways of cooperation,
exchange of information and best practices.
We recognise the fundamental role played by
Small and Medium-Sized Enterprises (SMEs) in the
economies of our countries. SMEs are major creators
of jobs and wealth. In this regard, we will explore
opportunities for cooperating in the field of SMEs
and recognise the need for promoting dialogue
among the respective Ministries and Agencies in
charge of the theme, particularly with a view to
promoting their international exchange and
cooperation and fostering innovation, research and
development.
We reiterate our strong commitment to the
United Nations (UN) as the foremost multilateral
forum entrusted with bringing about hope, peace,
order and sustainable development to the world. The
UN enjoys universal membership and is at the centre
of global governance and multilateralism.In this
regard, we reaffirm the need for a comprehensive
reform of the UN, including its Security Council, with
a view to making it more representative, effective and
efficient, so that it can be more responsive to global
challenges. In this regard, China and Russia reiterate
the importance they attach to the status of Brazil,
India and South Africa in international affairs and
support their aspiration to play a greater role in the
UN.
We underscore our commitment to work
together in the UN to continue our cooperation and
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strengthen multilateral approaches in international
relations based on the rule of law and anchored in the
Charter of the United Nations.
We are committed to building a harmonious
world of lasting peace and common prosperity and
reaffirm that the 21stcentury should be marked by
peace, security, development, and cooperation. It is
the overarching objective and strong shared desire
for peace, security, development and cooperation
that brought together BRICS countries.
We welcome the twentieth Anniversary of the
World Conference on Human Rights and of the
Vienna Declaration and Programme of Action and
agree to explore cooperation in the field of human
rights.
We commend the efforts of the international
community and acknowledge the central role of the
African Union (AU) and its Peace and Security
Council in conflict resolution in Africa. We call upon
the UNSC to enhance cooperation with the African
Union, and its Peace and Security Council, pursuant
to UNSC resolutions in this regard. We express our
deep concern with instability stretching from North
Africa, in particular the Sahel, and the Gulf of Guinea.
We also remain concerned about reports of
deterioration in humanitarian conditions in some
countries.
We welcome the appointment of the new
Chairperson of the AU Commission as an affirmation
of the leadership of women.
We express our deep concern with the
deterioration of the security and humanitarian
situation in Syria and condemn the increasing
violations of human rights and of international
humanitarian law as a result of continued violence.
We believe that the Joint Communiqu of the Geneva
Action Group provides a basis for resolution of the
Syrian crisis and reaffirm our opposition to any further
militarization of the conflict. A Syrian-led political
process leading to a transition can be achieved only
through broad national dialogue that meets the
legitimate aspirations of all sections of Syrian society
and respect for Syrian independence, territorial
integrity and sovereignty as expressed by the
Geneva Joint Communiqu and appropriate UNSC
resolutions. We support the efforts of the UN-League
of Arab States Joint Special Representative. In view
of the deterioration of the humanitarian situation in
Syria, we call upon all parties to allow and facilitate
immediate, safe, full and unimpeded access to
humanitarian organisations to all in need of
assistance. We urge all parties to ensure the safety of
humanitarian workers.
We welcome the admission of Palestine as an
Observer State to the United Nations. We are
concerned at the lack of progress in the Middle East
Peace Process and call on the international
community to assist both Israel and Palestine to work
towards a two-state solution with a contiguous and
economicallyviable Palestinian state, existing side by
side in peace with Israel, within internationally
recognized borders, based on those existing on
4 June 1967, with East Jerusalem as its capital.We are
deeply concerned about the construction of Israeli
settlements in the Occupied Palestinian Territories,
which is a violation of international law and harmful
to the peace process.In recalling the primary
responsibility of the UNSC in maintaining
international peace and security, we note the
importance that the Quartet reports regularly to the
Council about its efforts, which should contribute to
concrete progress.
We believe there is no alternative to a
negotiated solution to the Iranian nuclear issue. We
recognise Irans right to peaceful uses of nuclear
energy consistent with its international obligations,
and support resolution of the issues involved
through political and diplomatic means and dialogue,
including between the International Atomic Energy
Agency (IAEA) and Iran and in accordance with the
provisions of the relevant UN Security Council
Resolutions and consistent with Irans obligations
under the Treaty on the Non-Proliferation of Nuclear
Weapons (NPT). We are concerned about threats of
military action as well as unilateral sanctions. We
note the recent talks held in Almaty and hope that all
outstanding issues relating to Irans nuclear
programme will be resolved through discussions and
diplomatic means.
Afghanistan needs time, development
assistance and cooperation, preferential access to
world markets, foreign investment and a clear end-
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state strategy to attain lasting peace and stability. We
support the global communitys commitment to
Afghanistan, enunciated at the Bonn International
Conference in December 2011, to remain engaged
over the transformation decade from 2015-2024. We
affirm our commitment to support Afghanistans
emergence as a peaceful, stable and democratic state,
free of terrorism and extremism, and underscore the
need for more effective regional and international
cooperation for the stabilisation of Afghanistan,
including by combating terrorism. We extend support
to the efforts aimed at combating illicit traffic in
opiates originating in Afghanistan within the
framework of the Paris Pact.
We are gravely concerned with the
deterioration in the current situation in the Central
African Republic (CAR) and deplore the loss of life.
We strongly condemn the abuses and acts of
violence against the civilian population and urge all
parties to the conflict to immediately cease hostilities
and return to negotiations. We call upon all parties to
allow safe and unhindered humanitarian access. We
are ready to work with the international community to
assist in this endeavour and facilitate progress to a
peaceful resolution of the conflict. Brazil, Russia and
China express their sympathy to the South African
and Indian governments for the casualties that their
citizens suffered in the CAR.
We are gravely concerned by the ongoing
instability in the Democratic Republic of the Congo
(DRC). We welcome the signing in Addis Ababa on
24 February 2013 of the Peace, Security and
Cooperation Framework for the Democratic Republic
of the Congo and the Region. We support its
independence, territorial integrity and sovereignty.
We support the efforts of the UN, AU and sub-
regional organisations to bring about peace, security
and stability in the country.
We reiterate our strong condemnation of
terrorism in all its forms and manifestations and
stress that there can be no justification, whatsoever,
for any acts of terrorism. We believe that the UN has
a central role in coordinating international action
against terrorism within the framework of the UN
Charter and in accordance with principles and norms
of international law. In this context, we support the
implementation of the UN General Assembly Global
Counter-Terrorism Strategy and are determined to
strengthen cooperation in countering this global
threat. We also reiterate our call for concluding
negotiations as soon as possible in the UN General
Assembly on the Comprehensive Convention on
International Terrorism and its adoption by all
Member States and agreed to work together towards
this objective. We recognize the critical positive role
the Internet plays globally in promoting economic,
social and cultural development. We believe its
important to contribute to and participate in a
peaceful, secure, and open cyberspace and we
emphasise that security in the use of Information and
Communication Technologies (ICTs) through
universally accepted norms, standards and practices
is of paramount importance.
We congratulate Brazil on hosting the UN
Conference on Sustainable Development (Rio+20) in
June 2012 and welcome the outcome as reflected in
The Future we Want, in particular, the reaffirmation
of the Rio Principles and political commitment made
towards sustainable development and poverty
eradication while creating opportunities for BRICS
partners to engage and cooperate in the development
of the future Sustainable Development Goals.
We congratulate India on the outcome of the
11th Conference of the Parties to the United Nations
Conference on Biological Diversity (CBD COP11) and
the sixth meeting of the Conference of the Parties
serving as the Meeting of the Parties to the Cartagena
Protocol on Biosafety. While acknowledging that
climate change is one of the greatest challenges and
threats towards achieving sustainable development,
we call on all partiesto build on the decisions adopted
in COP 18/CMP8 in Doha, with a view to reaching a
successful conclusion by 2015, of negotiations on the
development of a protocol, another legal instrument
or an agreed outcome with legal force under the
Convention applicable to all Parties, guided by its
principles and provisions.
We believe that the internationally agreed
development goals including the Millennium
Development Goals (MDGs) address the needs of
developing countries, many of which continue to face
developmental challenges, including widespread
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poverty and inequality. Low Income Countries (LICs)
continue to face challenges that threaten the
impressive growth performance of recent years.
Volatility in food and other commodity prices have
made food security an issue as well as constraining
their sources of revenue. Progress in rebuilding
macro-economic buffers has been relatively slow,
partly due to measures adopted to mitigate the social
impact of exogenous shocks. Many LICs are
currently in a weaker position to deal with exogenous
shocks given the more limited fiscal buffers and the
constrained aid envelopes, which will affect their
ability to sustain progress towards achieving the
MDGs. We reiterate that individual countries,
especially in Africa and other developing countries of
the South, cannot achieve the MDGs on their own
and therefore the centrality of Goal 8 on Global
Partnerships for Development to achieve the MDGs
should remain at the core of the global development
discourse for the UN System. Furthermore, this
requires the honouring of all commitments made in
the outcome documents of previous major
international conferences.
We reiterate our commitment to work together
for accelerated progress in attaining the Millennium
Development Goals (MDGs) by the target date of
2015, and we call upon other members of the
international community to work towards the same
objective. In this regard, we stress that the
development agenda beyond 2015 should build on
the MDG framework, keeping the focus on poverty
eradication and human development, while
addressing emerging challenges of development
taking into consideration individual national
circumstances of developing countries. In this regard
the critical issue of the mobilization of means of
implementation in assisting developing countries
needs to be an overarching goal. It is important to
ensure that any discussion on the UN development
agenda, including the Post 2015 Development
Agenda is an inclusive and transparent inter-
Governmental process under a UN-wide process
which is universal and broad based. We welcome the
establishment of the Open Working Group on the
Sustainable Development Goals (SDGs), in line with
the Rio+20 Outcome Document which reaffirmed the
Rio Principles of Sustainable Development as the
basis for addressing new and emerging challenges.
We are fully committed to a coordinated inter-
governmental process for the elaboration of the UN
development agenda.
We note the following meetings held in the
implementation of the Delhi Action Plan:
Meeting of Ministers of Foreign Affairs on
the margins of UNGA.
Meeting of National Security Advisors in
New Delhi.
Meetings of Finance Ministers, and Central
Bank Governors in Washington DC and
Tokyo.
Meeting of Trade Ministers in Puerto
Vallarta.
Meetings of Health Ministers in New Delhi
and Geneva.
We welcome the establishment of the BRICS
Think Tanks Council and the BRICS Business
Council and take note ofthe following meetings which
were held in preparation for this Summit: Fifth
Academic ForumFourth Business ForumThird
Financial Forum
We welcome the outcomes of the meeting of
the BRICS Finance Ministers and Central Bank
Governors and endorse the Joint Communique of the
Third Meeting of the BRICS Trade Ministers held in
preparation for the Summit.
We are committed to forging a stronger
partnership for common development. To this end,
we adopt the eThekwini Action Plan. We agree that
the next summit cycles will, in principle, follow the
sequence of Brazil, Russia, India, China and South
Africa. Brazil, Russia, India and China extend their
warm appreciation to the Government and people of
South Africa for hosting the Fifth BRICS Summit in
Durban. Russia, India, China and South Africa
convey their appreciation to Brazil for its offer to host
the first Summit of the second cycle of BRICS
Summits, i.e. the Sixth BRICS Summit in 2014 and
convey their full support thereto. eThekwini Action
Plan:
1. Meeting of BRICS Ministers of Foreign
Affairs on the margins of UNGA.
2. Meeting of BRICS National Security
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Advisors.
3. Mid-term meeting of Sherpas and Sous-
Sherpas.
4. Meetings of Finance Ministers and Central
Bank Governors in the margins of G20
meetings, WB/IMF meetings, as well as
stand-alone meetings, as required.
5. Meetings of BRICS Trade Ministers on the
margins of multilateral events, or stand-alone
meetings, as required.
6. Meeting of BRICS Ministers of Agriculture
and Agrarian Development, preceded by a
preparatory meeting of experts on agro-
products and food security issues and the
Meeting of Agriculture Expert Working
Group.
7. Meeting of BRICS Health Ministers and
preparatory meetings.
8. Meeting of BRICS Officials responsible for
population on the margins of relevant
multilateral events.
9. Meeting of BRICS Ministers of Science and
Technology and meeting of BRICS Senior
Officials on Science and Technology.
10. Meeting of BRICS Cooperatives.
11. Meetings of financial and fiscal authorities
in the margins of WB/IMF meetings as well
as stand-alone meetings, as required.
12. Meetings of the BRICS Contact Group on
Economic and Trade Issues (CGETI).
13. Meeting of the BRICS Friendship Cities and
Local Governments Cooperation Forum.
14. Meeting of the BRICS Urbanisation Forum.
15 .Meeting of BRICS Competition Authorities
in 2013 in New Delhi.
16. 5th Meeting of BRICS Heads of National
Statistical Institutions.
17. Consultations amongst BRICS Permanent
Missions and/or Embassies, as appropriate,
in New York, Vienna, Rome, Paris,
Washington, Nairobi and Geneva, where
appropriate.
18. Consultative meeting of BRICS Senior
Officials in the margins of relevant
sustainable development, environment and
climate related international fora, where
appropriate.
New areas of cooperation to be explored-
BRICS Public Diplomacy Forum. -BRICS Anti-
Corruption Cooperation.
- BRICS State Owned Companies / State
Owned Enterprises.
- National Agencies Responsible for Drug
Control.
- BRICS virtual secretariat.
- BRICS Youth Policy Dialogue.
- Tourism.
- Energy.
- Sports and Mega Sporting Events.
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100TH
INDIAN SCIENCE CONGRESS AT KOLKATA
O
n 3 January 2013, the Prime Minister
announced the new Science,
technology and Innovations (STI)
policy to a packed audience at the 100
th
session of
the Indian Science Congress held in Kolkata.
The policy seeks to increase applications of
research and development through new methods of
public private participation, increase participation of
youth in scientific development of the country and
promote the spread of scientific temper among
various sections of the society.
The fourth science policy of the country that
is expected to change the way science education,
research and innovation is done in the country
received its fair share of limelight given that it was
announced at the centenary celebrations of
the oldest science event in the country, The limelight
gives the public an opportunity of scrutinizing the
policy,
Focal Theme Panel Discussion
Announcing the aspirations of the policy to
position India among the top five global scientific
powers by the year 2020, the Prime Minister threw
open the panel discussion on what should be done
to ensure that science plays a crucial role in shaping
the future of India.
John Beddington, the Chief Scientific advisor
of the Government of UK emphasized that India
needs to take steps to deal with climate change that
is likely to affect India severely in the long run, He
said that for doing so, energy security and disaster
management were two of the most crucial Issues that
need to be addressed. Elaborating on the steps that
need to be taken to tackle problems like food security
in the climate change era, Prof, M.S, Swaminathan,
Emeritus Chairman of MS Swaminathan Research
Foundation, pointed out that new technology is
necessary to cope up with the change and robust
and transparent regulatory mechanisms should be set
up to evaluate such technologies and monitor their
evolution.
Dr R, Chidambaram, chief scientific advisor to
the government of India, elaborated on the relevance
of developing alternative energy sources to tackle
these changes while Dr K, Kasturirangan, member of
the planning commission, highlighted the ambitious
nature of the 12th five year plan in this context, Prof,
Samir Brahmachari, Director-General, Council of
Scientific and Industrial Research, stressed that
encouraging young leaders in science would help in
generating new ideas that are necessary to solve the
complex nature of problems science Is expected to
solve today. While summing up the session MS
Jaipal Reddy, the minister for science and technology,
however, pointed out that given Indias track record
in teh 11th plan, it was not very difficult for India to
try and reach the target. He stressed on focusing on
development of innovative ecosystems.
It is with the objective of attracting ryoung
talents to develop innovative ecosystems that the
congress deliberated on ways of reforming
universities to shape such talents.
RECOMMENDATIONS OF THE CONGRESS
The five-day deliberations each year lead to a
set of recommendations on that should be done to
improve the role of science in shaping the future of
the country. The list released this year included:
Gist of
SCIENCE REPORTER
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(1) Special efforts to attract talent and develop
human resource, encourage youthful
leadership in the science sector,
(2) Readjust governance system of universities
to rejuvenate research in the academic sector,
(3) Link discovery processes to problem solving
responsibilities,
(4) New models for international collaborations,
(5) Suitable strategy and roadmap for meeting
the challenging needs of food nutrition,
energy, environment, water and sanitation.
The recommendations also included enhancing
the public outreach of science through effective
communication with a focus on political and public
understanding of science and the ramifications of
new and emerging technologies of relevance to
social problems. The recommendations were
discussed in detail in a session on networking and
governance. It emerged that human resource
development and encouraging young leadership in
science were the key areas of concern.
The panel consisting of Dr. T. Ramasami,
Secretary, Department of Science and Technology,
Prof. Samir Brahmachari, Director General of CSIR, Dr.
M. Rajeevan, head of Indias monsoon mission, Dr.
R.R. Navalgund, Honourary Vikram Sarabhai
Professor at the Indian Space Research Centre at
Bangalore and directors of some of the laboratories
of CSIR, discussed steps like stepping up the
national geospatial governance, and more
involvement of interested youth in research at an
early stage.
Dr. R.R. Navalgund emphasized that we should
not stop only at recommendations but also prioritize
them and design a roadmap of how to materialize such
recommendations.
In 1980, the Department of Science and
Technology set up a task force to take the
recommendations of each years science congress
forward. It was to involve representatives of the
Indian Science Congress Association (ISCA) and
chiefs of different agencies and voluntary
organizations chaired by Secretary, DST, for following
up the recommendations on the Focal Theme
introduced by the congress in 1976. However,
according to sources the task force was discontinued
later. This year, however, the recommendations
indicated an attempt to resurrect the task force. A
small committee of five may be constituted to capture
the major recommendations emanating from the 100th
session of the Indian science congress in a time
bound manner, it said.
Despite the fact that several eminent scientists
have time and again pointed at certain lacunae in the
conduct of the annual sessions of the Indian Science
Congress, yet it still remains the science conference
that the media takes interest in, reflecting that the
interest of the common people in the conference
remains undiminished even after 100 years. The
congress can take advantage of this and reorient itself
to improve the quality of deliberations and make it
interesting and relevant to the practicing scientist
also. Only then will the initial objective of promoting
science with which it was set up be served.
PLANTS BEHAVE A LOT LIKE HUMANS!
Does the title sound storage to you? Well, let
us be clear, it humans carry their intelligence on their
sleeves, plant carry them on the plants has unfolded
a wider spectrum of possibilities.
Rescinding the myth of a passive plant world,
the secret world of plants reveals a landscape
pulsing with sex, movement. Communication and
social interaction. This is a world where plants talk.
Forage, wage war and protect their kin; a world where
plants behave a lot like us.
Recently, scientists observed how Dandelions
reacted to the passing of a lawn mower. The closer it
gets, the more the blossom heads seem to hunker
down closer to the ground. Yet an hour or so later. the
stems are again at full height. Two researchers at the
University of Alberta found plants with similar
foraging strategies. These plants get their nutrients
from their root tips and roots produce more tips when
they hit a patch of nutrient-rich soil!
Plants engage in activities such as
eavesdropping on each other and can detect
chemical compounds released by their neighbours
when under attack from hungry caterpillars so they
can marshal their own defences.
While humans are enthralled into amassing
money and smothering the fire of their bellies. plants
are dynamic and highly sensitive organisms that
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actively and competitively forage for limited resources
both above and below the ground. They accurately
compute inputs from the environment, use
sophisticated cost-benefit analysis, and take action to
mitigate diverse environmental insults, which involves
the acquisition and processing of information.
Informational terminology assists in the concepts of
learning, memory and intelligence in plants,
capabilities that they are rarely credited with.
Plants are also capable of refined recognition of
self and non-self, and are territorial in behaviour. This
view portrays plants as information processing
organisms with complex, long-distance
communication systems within their body, which
extends into the surrounding ecosystem. Plants
display all the necessary components of intelligent
behaviour (assuming that their plastic, flexible
development is behaviour). In particular, they surely
do exhibit individual variability and adaptations.
Moreover, they continuously record and evaluate a
complex field of external stimuli, forming thereby
something which could be described as an inner
representation or a cognitive map of the
environment, including information about qualitative
and quantitative aspects of light conditions,
humidity, temperature and other biotic and abiotic
environmental inputs.
Plants store a wealth of data about their history
in the structure of their bodies. Given the permanent
character of cell walls, every branch and twig holds
information about the past. The memory of winter
involved in seasonally dependent acquisition of
flowering competence (vernalization) has been traced
down to complex epigenetic regulation of the gene
encoding a specific transcription factor (FLC) in
Arabidopsis.
REGISTRATION FOR NEW INDIAN CATTLE BREEDS
The National Bureau of Animal Genetic Resources, Karnal (NBAGR) is the nodal agency for the
registration of newly identified germplasm of the livestock and poultry of the country. For the first time,
indigenous pig and donkey breeds have been registered by NBAGR. The Breed Registration Committee
has approved registration of nine new breeds of livestock species.
Newly identified breeds are custom-made for the local climate and thrive better in adverse
environmental conditions and food shortage. Indigenous breeds also have exclusive characters like
disease resistance, better quality of milk and meat etc. The newly registered breeds are:
Malnad Gidda: Malnad Gidda cattle breed is native of Western Ghats in Karnataka.
The word gidda denotes dwarf and Malnad denotes a place receiving high rainfall. This breed is
distributed predominantly in Malnad areas of Shimoga, Hassan, Chikmangalur and adjacent coastal
districts of Mangalore, Udupi, North Kanara and parts of Kodagu district of Karnataka. The animals
are small in size with a compact body frame weighing 80-120 kg. The animals are active and resistant
to major diseases such as foot and mouth disease. This breed yields 0.5 to 4 litres of milk per day with
a fat content of 5.5 to 8 percent. The animals remain in milking for about 250 days in a year. The
average lifespan of an adult animal is 9-12 years.
Kalahandi buffaloes: Medium sized, very hardy, dual type breed, well known for longevity, these buffaloes
are seen in the Gajapati district and parts
of Ganjam and Rayagada district in Orissa, and also the adjoining hilly regions of Andhra Pradesh.
Besides the use of this buffalo for milk and draft purpose, the horns are used in making handicrafts and
household items. These buffaloes are known for their working ability and disease resistance in the
native tract. Male buffaloes weigh up to 380 kg and females 350 kg.
Puliculam cattle: The Pulikulam breed or Jallikkattu breed of cattle is found in Madurai, Sivaganga,
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Virudhunagar, Theni and also the Cum bum valley and the Periyar River. Compact with stout legs and
hard feet, the animals have powerful loins, shoulders and neck, useful for doing hard work. This breed
is more resistant to communicable and parasitic diseases as compared to
crossbreds under hot and wet conditions. Famous for their high endurance levels, they are commonly
used in the hugely popular Jallikattu (bull taming) sport in South Madurai during Pongal. About
45,000 of the animals exist now and are maintained as migrating herds. Kosali cattle: Kosali is small
sized, draft purpose cattle breed of Chhattisgarh. Farmers prefer bullocks of this breed for cleaning of
weeds from paddy field. Animals are known for their efficient working ability and high resistance to
disease.
Konkan Kanyal goat: Konkal Kanyal goat is meat type breed adapted to high rainfall and the hot and
humid climate of Konkan region in Maharashtra. Animals have typical white bands on black face and
black ear with white margin. Adult males weigh 40-45 kg and adult females weigh 32-35 kg.
Konkan Kanyal goat
Berari goat: Found in Nagpur and Wardha district of Maharashtra and Ninar district of Madhya
Pradesh. Berari goat is also reared mainly for meat purpose in Vidarbh region of Maharashtra. These
are tall and dark coloured breeds. A unique feature is that animals have light to dark strips on lateral
sides from horn base to nostrils of face. Doe yields about 0.6 litres of milk per day.
Ghungroo pig: Ghungroo an indigenous strain of pig first reported from North Bengal. It is popular
among the local people because of its ability to sustain in low input system. Faster growth rate,
consumers preference and adaptability to low management are some of the excellent characteristics
exhibited by this breed. This breed produces high quality pork utilizing agricultural by-products and
kitchen wastes. Ghungroo pigs are mostly black coloured with typical bulldog face appearance, with
a litter size of six to twelve. Both sexes are very much docile and easy to handle.
Niang megha: Niang Megha is a pig breed from Garo, Khasi and Jaintia hills of Meghalaya, reared
for its pork and hair. The animals have typical wild look with erect hairs on dorsal midline and small
erect ears extended vertically.
Spiti donkey: Spiti donkey is found in Lahaul and Spiti region of Himachal Pradesh. The breed is
utilized for transportation at high altitude area with low levels of environmental oxygen. These animals
can survive well in scarcity of feed and fodder during harsh winter months when the area is completely
snow-bound.
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1. English Language Comprehension Skills `195
2. Data Interpretation and Data Sufficiency `225
3. Basic Numeracy `240
4. Logical Reasoning & Analytical Ability `230
5. CSAT PaperI General Studies Question Bank `170
6. General Knowledge Manual 2013 `180
7. English Grammar and Usage `220
8. |=|+n =|+ = = )-=|= = === (|r-:|) =|: `390
9. CSAT Comprehensive Manual `650
10. India2011 `230
11. General Studies Preliminary Examination Topic Wise Solved Question Paper (1995-2011) `250
12. =| n|= = +| |=| = =|=|-= === (+||-|= +|-||) |+|=+| rn +.=-+| (z++:-z+::) `190
13. General Studies Mains Examination Topic Wise Question Analysis (1989-2011) `150
14. =|=|-= === =c= +|-|| +.=-+| (:+s+-z+::) `220
15. SSC Graduate Level Examination Solved & Practice Paper `275
16. A Comprehensive Guide for SSC Graduate Level Examination `360
17. Bank PO Planner `245
18. Bank PO Practice Set `280
19. S.B.I. Probationary Officer (Recruitment Examination 2011) `210
20. Geography IAS (Mains) Optional Topic Wise Question Analysis `155
21. Sociology IAS (Mains) Optional Topic Wise Question Analysis `150
22. Hindi/English/Essay (Mains) Compulsory Topic Wise Question Analysis `150
23. Law (Mains) Optional Topic Wise Question Analysis `150
Indias Leading Publisher for
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24. Public Administration Optional (Mains) Topic Wise Question Analysis `150
25. General Studies (IAS) Solved Paper 2001-2011 `270
26. History (Mains) Optional Topic Wise Question Analysis `150
27. 2 Markers for IAS (Mains)/PCS General Study `185
28. CDS Solved Papers `295
29. Guide for Clerk Grade (IBPS) `280
30. Current Affairs2011 `250
31. NDA/NA (Solved & Practice Papers) `325
32. SCRA (Practice & Solved Papers) `325
33. General Science for Civil Services Preliminary Examination `250
34. Indian History for Civil Services Preliminary Examination `395
35. Environment for Civil Services Preliminary Examination `250
36. Indian Polity for Civil Services Preliminary Examination `350
37. Geography for Civil Services Preliminary Examination `315
38. Indian History MCQ's Series `95
39. Indian Polity MCQ's Series `95
40. Geography & Environment MCQ's Series `160
41. Indian Economy MCQ's Series `120
42. Basic Numeracy MCQ's Series `130
43. Data Interpretation and Data Sufficiency MCQ's Series `130
44. General Science MCQ's `120
45. Logical Reasoning & Analytical Reasoning MCQ's `120
46. CSAT General Studies Manual IAS Preliminary Examination Paper I `1025
47. |r-:| =||r= +|+== ++ =c= +|-|| `140
48. Indian Economy for Civil Services Preliminary Examination `260
49. Special Current Affairs for Civil Services Examination 2013 `410
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61. A Complete Guide for SBI & Associate Banks `295
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63. History (Main) IAS Solved Paper 2002-2011 `250
64. SSC (10+2) Level Examination Guide `340
65. The Vault of 1,2,3 & 5 Markers (Part1) `295
66. The Vault of 1,2,3 & 5 Markers (Part1I) `225
67. CAPF `310
68. Current Affairs 2012-2013 `225
69. IBPS Work Book for Clerk Examination ` 90
70. GS Pre Questions (2006-2012) ` 130
71. Logical & Analytical Ability MCQ ` 130
72. NDA Practice Papers ` 200
73. SCRA Practice Papers ` 220
74. CDS Practice Papers ` 200
75. SSC Practice Papers ` 175
76. SSC Success Series History ` 80
77. SSC Success Series Geography ` 80
78. SSC Success Series General Science ` 80
79. SSC Success Series Indian Economy ` 80
80. SSC Success Series Indian Polity ` 75
81. SSC Success Series General Knowledge ` 75
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82. SSC Solved Paper `175
83. )=.)=.=|. =+== =||= -||-|= :|-r|= `85
84. )=.)=.=|. =+== =||= -||-|= |==+=|| `85
85. )=.)=.=|. =+== =||= -|=|n `80
86. IBPS PO Guide (Hindi) `340
87. IBPS Practice Papers Paper (Hindi) `140
88. IBPS Solved Papers `170
89. CTET Practice Papers Class (15) `125
90. CTET Practice Papers Class (68) `125

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Contents

GIST OF THE HINDU ......................................................................................................... 2

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