Indian Economy, 5th edition (16 page)

The issue of
Price Stability
remained resonating for more than half of the Plan Period. To ward off the crisis of rising prices, the Government needed to announce several tax concessions at one hand, while it could not pass the burden of the costlier imported oil prices on the masses. That would have resulted in ultimately putting the exchequer in a fund-crunch mode, at the end, creating a short-supply of investible funds in the government’s hand, hence, causing the 11th Plan to perform at the levels below its target.

Twelfth Plan:

The Draft Approach Paper to the Twelfth Five Year Plan (2012-17) has been approved by the Cabinet. The theme of the approach Paper to the Twelfth Five year Plan is
“faster, sustainable and more inclusive growth”.
The National Development Council (NDC) was supposed to give its final nod to the plan in its meeting scheduled on October 22, 2011 but as many working groups have not submitted their final reports to their respective divisions the process is getting delayed, it is expected to come to the NDC meeting by late 2012. As far as progress of the 12th Plan documentation is concerned, the NDC had approved the ‘Approach Paper’ on August 20, 2011 itself. The documents for 10th and 11th Plans too were finalised much later after the beginning of the respective Plan periods.

The Draft Approach Paper lays down the major targets of the Plan, the key challenges in meeting them, and the broad approach that must be followed to achieve the stated objectives which are summed-up as follows:

(i)
Growth rate of 9 per cent is targeted for the Plan. However, in view of the uncertainties in the global economy and the challenges in the domestic economy, the Approach Paper indicates that it could be achieved only if some
difficult decisions
are taken.

(ii)
It emphasizes the need to intensify efforts to have 4 per cent average growth in
agriculture
sector during the Plan period; with foodgrains growing at about 2 per cent per year and non-food grains (notably, horticulture, livestock, dairying, poultry and fisheries) growing at 5 to 6 per cent.

(iii)
The higher growth in agriculture would not only provide broad based income benefits to the rural population but also help restrain
inflationary pressure
, which could arise if high levels of growth are attempted without corresponding growth in domestic food production capabilities.

(iv)
It proposes that the major
flagship programmes
which were instrumental for promoting inclusiveness in the Eleventh Plan should continue in the Twelfth Plan – there is a need to focus on issues of implementation and governance to improve their effectiveness.

(v)
The Plan indicates that the
energy
needs of rapid growth will pose a major challenge since these requirements have to be met in an environment where domestic energy prices are constrained and world energy prices are high and likely to rise further.

(vi)
For the GDP to grow at 9 per cent, commercial energy supplies will have to grow at a rate between 6.5 and 7 per cent per year. Since India’s domestic energy supplies are limited, dependence upon imports will increase. Import dependence in the case of petroleum has always been high and is projected to be
80
per cent in the Twelfth Plan.

(vii)
Even in the case of
coal
, import dependence is projected to increase as the growth of thermal generation will require coal supplies which cannot be fully met from domestic mines.

(viii)
It suggests the need to take steps to reduce energy intensity of production processes, increase domestic energy supply as quickly as possible and ensure rational energy pricing that will help achieve both objectives viz. reduced energy intensity of production process and enhance domestic energy supply, even though it may seem difficult to attempt.

(ix)
It draws attention to evolving a holistic
water
management policy aiming at more efficient conservation of water and also in water use efficiency particularly in the field of agriculture.

(x)
It argues that a new legislation for
land acquisition
is necessary, which strikes an appropriate balance between the need for fair compensation to those whose land is acquired and whose livelihood is disrupted, and the need to ensure that land acquisition does not become an impossible impediment to meeting our needs for infrastructure development, industrial expansion and urbanisation.

(xi)
It maintains that
health, education
and
skill development
will continue to be focus areas in the Twelfth Plan and that there is a need to ensure adequate resources to these sectors –
‘universal healthcare’
proposed by it, emphatically. Simultaneously, it also points to the need to ensure maximum efficiency in terms of outcomes for the resources allocated to these sectors. The need to harness
private investment
in these sectors has also been emphasised by the approach.

(xii)
It takes cognizance of the fact that achieving 9 percent growth will require large
investments
in infrastructure sector development – notes greater momentum to public investment and Public Private Partnerships (PPPs) in infrastructure sector needs to be imparted so that present infrastructure shortages can be addressed early.

(xiii)
It has emphasised the importance of the process of
fiscal correction
. However, the paper cautions that fiscal consolidation would imply that total resources available for the Plan in the short run will be limited. Resource limitations imply the need to prioritise carefully and that some
priority areas
, e.g., health, education and infrastructure will have to be funded more than others.

(xiv)
It also emphasizes the need for focusing more on
efficient use
of available resources in view of the resource constraints. The Paper makes several suggestions in this regard, including giving implementing agencies greater amount of freedom, flexibility, promoting convergence between resources from different Plan schemes and the need for much greater attention to capacity building, monitoring and accountability.

B. Twenty-Point Programme

The Twenty Point Programme (TPP) is the second Central Plan which was launched in July 1975. The programme was conceived for coordinated and intensive monitoring of a number of schemes implemented by the Central and the State Governments. The basic
objective
was of improving the quality of life of the people, especially of those living below the poverty line. Under this, a thrust was given to schemes relating to poverty alleviation, employment generation in rural areas, housing, education, family welfare and health, protection of environment and many other schemes having a bearing on the quality of life in the rural areas.

The programme was restructured in 1982 and 1986. The programme, known as the
‘TPP-86’
has 119 items grouped into 20 Points which are related to the improvement in the quality of life in the rural areas. Among the total items, 54 are monitored on the basis of evaluatory criteria, 65 against pre-set physical targets and rest of the 20 important items on the monthly basis. The targets are fixed by the Ministries at the Centre in consultation with the states and the UTs. The allocation for the programme is done under the various Five-Year Plans.

The ‘TPP-86’ has been restructured and named ‘TPP-2006’ keeping in view the challenges of the 21st Century with particular reference to the process of the Economic Reforms. This is in harmony with the National Common Minimum Programme (NCMP) of the UPA Government.

Basically, the programme was targetted to the cause of poverty alleviation with the ‘direct attack’ approach. This experiment encouraged the Government to go for a whole Five-Year Plan with the slogan ‘Garibi Hatao’ (i.e the Sixth Plan, 1980–85). Over the years, the political changes at the Centre did not affect the programme and it has been continuously implented, more so due to its being of a high populist nature and known to the masses, as the experts believe.

C.
MpladS

The Member of Parliament Local Area Development Scheme (MPLADS) is the last of the Central Plans and latest to have been launched, too. The scheme was launched on December 23, 1993 with only Rs. 5 lakh given to each MPs which was increased to Rs. 1 crore in the year 1994–95.
w
hen the MPs did put a demand to increase the sum to Rs. 5 crore in 1997–98, finally the Government enhanced it to Rs. 2 crore since 1998–99. In April 2011 the corpus was enhanced to Rs. 5 crore while announcing the new guidelines for the scheme.

Basically, in the early 1990s there came a demand from the MPs cutting across the party line for such a scheme so that the fruits of development could directly reach the masses via their representatives. The Government of the time decided to go in for such a scheme and the MPLADS came.

Under this scheme the Members of Parliament
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recommend some works (i.e. creation of fixed community assets, based on locally felt developmental needs) to the concerned District Magistrate. The scheme is governed by a set of guidelines, which have been comprehensively revised and issued in November 2005. Its performance has improved due to pro-active policy initiatives, focus monitoring and review.
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In recent years, many criticisms of the scheme came to the public notice which concerned either misappropriation of the funds or non-use of the funds, especially from the backward states. The people’s representative at the PRI level have been demanding scrapping of the scheme as it infringes the idea of decentralised planning. In it’s place, they want the funds to be given to the local bodies directly for the same kind of works specified by the MPLADS.
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The MOSPI (Ministry of Statistics and Programme Implementation) issued
revised guidelines
for the Scheme in
August, 2012
with following salient features – .

i.
Assistance to physically challenged persons upto maximum of Rs.10 lakh per year for purchase of
tri-cycles
and
artificial limbs
have been allowed,

ii.
Ambulances/hearse vans under the District Authority/CMO/Civil Surgeon of the district can now also be operated through private organizations,

iii.
MPs allowed to recommend eligible works upto Rs.10 lakh per year outside the constituency for Lok Sabha MPs and outside States for Rajya Sabha MPs.

iv.
Advances to Government implementing agencies increased to the ratio of 75:25 (from 50:50).

v.
Contingency Funds of 0.5% have been increased to 2% of the annual entitlement as administrative expenses.

vi.
Works can also be implemented in areas affected by
man-made calamities
like chemical, biological and radiological hazards.

vii.
Mobile Library for Government Educational Institutions/Public Libraries now permissible.

viii.
Works from out of the shelf of MGNREG. A project approved by the Zilla Panchayat for the year may also be recommended under the MPLAD Scheme. Similarly,
convergence
of MPLADS funds with Panchayat Yuva Krida aur Khel Abhiyan (PYKKA) and Urban Sports Infrastructure Scheme (USIS) for creation of durable sports assets from out of the shelf of PYKKA Projects has been allowed.

ix.
Funds can be used now for construction of Railway Halt Stations to facilitate the local community for boarding/deboarding the train.

x.
An MP has been entitled for setting up of MPLADS Facilitation Centre in the Nodal District for which MPLADS funds not exceeding Rs. 5 lakh being the cost of equipments, furniture, etc. can be used. The space/room would be provided by DC/DM in the premises of Collectorate/DRDA and the recurring running expenses will be booked under 2 per cent of the administrative charges, of which the Nodal District gets 0.8 per cent.

xi.
MPs may recommend purchase of
books
up to Rs. 22 lakh annually for schools/colleges/public.

Besides, an annual competition
‘One MP – One Idea’
was also introduced for selecting three best innovations in solving local problems to be held in each Lok Sabha Constituency.

MULTI-LEVEL PLANNING

It was by the late 1950s and the early 1960s that the states demanded the right to plan at the state level. By the mid-1960s, the states were given the power to plan by the Centre advising them that they should promote planning at the lower levels of the administrative set strata, too i.e. the district level planning–via the Municipalities and Corporations in the urban areas and via Block level through Panchayats and the Tribal Boards. By the early 1980s, India was a country of the multi-level planning (MLP) with the structure and strata of planning as follows:

First Strata: The Centre Level Planning

At this level three types of Central Plans had evolved over the years—the Five Year Plans, the Twenty Point Programme and the MPLADS.

Second Strata: The State Level Planning

By 1960s, the states were planning at the state level with their respective planning bodies, the state Planning Boards with the respective CMs being their de-facto Chairman. The States Plans were for a term of five years and parallel to the concerned Five–Year Plans of the Centre.

Third Strata: The District Level Planning

By the late 1960s all the districts of the states were having their own plans with their respective District Planning Boards
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with the respective District Magistrates being their de-facto chairmen. The district level plans are implemented now via Municipalities or Corporations in the urban areas and the Panchayats via the Blocks in the rural areas.