Showing posts with label India. Show all posts
Showing posts with label India. Show all posts

Sunday, December 25, 2011

Why India's Growth is Faltering

Why India’s Growth is faltering

India must define its priorities. If  we look at present unexpected bump and lower IIP number, one thing has become very clear this year India's growth is going for rough ride. The growth, development and middle class everything is just gone and vanished to give sleepless night.
If India want to grow and long term sustainable growth can only come from where it is needed most. In my opinion Rural and Agriculture is the core. Governments attitude of neglecting this sector for last one decade is sole reason for today debacle.

  1. Government must give enough weight-age to the rural and agriculture development  where 72% population resides.( This is steadily going in down in last one decade)
  2. Water shade management and conservation must be given priority so that the farmers in the areas of rain-fed farming may have better income and opportunities to go for multiple farming.
  3. India's infrastructure is pathetic, this must improve. Power generation should be priority.( Power generation should not be hold hostage to the governments foreign policy, government should sign gas pipeline agreement with Iran and this will reduce inflation and improve the power availability, the ultimate effect will be in good growth.)
  4. Indian Railway is outdated and should improve and upgrade. It must double its capacity to cater to the needs of growing aspirations of fast growth of India.
  5. Roads and Airports must be priority.
  6. Food industry should take priority.
  7. Mandi act needs to be amendment.

India: Priorities for Agriculture and Rural Development
Although agriculture contributes only 21% of India’s GDP, its importance in the country’s economic, social, and political fabric goes well beyond this indicator. The rural areas are still home to some 72 percent of the India’s 1.1 billion people, a large number of whom are poor. Most of the rural poor depend on rain-fed agriculture and fragile forests for their livelihoods.
The sharp rise in food grain production during India’s Green Revolution of the 1970s enabled the country to achieve self-sufficiency in food grains and stave off the threat of famine. Agricultural intensification in the 1970s to 1980s saw an increased demand for rural labor that raised rural wages and, together with declining food prices, reduced rural poverty.
Inequitable allocation of water: Many states lack the incentives, policy, regulatory, and institutional framework for the efficient, sustainable, and equitable allocation of water.
Deteriorating irrigation infrastructure: Public spending in irrigation is spread over many uncompleted projects. In addition, existing infrastructure has rapidly deteriorated as operations and maintenance is given lower priority.
Rural poor have little access to credit: While India has a wide network of rural finance institutions, many of the rural poor remain excluded, due to inefficiencies in the formal finance institutions, the weak regulatory framework, high transaction costs, and risks associated with lending to agriculture.
Weak Natural Resources Management: One quarter of India’s population depends on forests for at least part of their livelihoods.
India's "green revolution" allowed the country to produce enough food to feed its population - but 40 years on, is this revolution unraveling?
The Green Revolution was a deliberate, all-out attempt to become self-sufficient in basic food crops.
For 40 years. Under India's "Green Revolution" in the 1960s and 70s -- seen as one of the world's most successful agricultural turnarounds -- planting of high-yield varieties of wheat and rice resulted in a sharp output rise.
There has been a dearth of resource support to the farmers in the Union budgets which calls for urgent attention of the policy makers to boost budgetary investment in agriculture in general, and dry land and rain fed agriculture in particular. In 2006- 07, the share of agriculture in total budget was meager 1.4 percent. This has further declined to 1.27 percent in the current Union Budget 2010-11 (BE). A quantum jump of expenditure by the Ministry (to around 2.5 times, in absolute numbers, between 2004-05 and 2010-11) has been noticed. However, public spending in agriculture as a proportion of GDP is hardly perceptible. It has increased from 0.17 percent of GDP in 2004-05 to 0.20 percent of GDP in 2010-11 B.E. The government needs to direct its efforts towards improved rural infrastructure, agricultural research support, investments in water management and new technology/institutional innovations to increase agricultural productivity, and consequently growth of the economy. Long-term sustainability of India’s farming sector, particularly dry land agriculture, is only possible through coordinated efforts from different quarters along with increase in share of budgetary investment in the agriculture and allied sector and share of Central plan expenditure in agriculture.
Need for public investment
The record of agricultural growth in India in the second-half of the 2000s was hardly inspiring. Growth rates of agriculture in 2006-07 and 2007-08 were better on the average, riding on good monsoons and hardening global prices. However, the growth rates in 2008-09 and 2009-10 were, respectively, -0.1 per cent and 0.4 per cent. Advance estimates for 2010-11 have raised hopes again, but it is clear that elevating agriculture to a path of sustained growth requires a major increase in public expenditure. In particular, public investment, which would create fixed capital formation in agriculture, has to increase significantly to arrest decisively the trend of long-term decline. Budget 2011-12 plainly refuses to recognise this task as urgent.
How numbers are manipulated
The sharp rise in the supply of indirect finance was facilitated by a series of definitional changes made under the UPA regime on what constitutes priority sector credit in agriculture (for details, see R. Ramakumar and Pallavi Chavan, “Revival of Agricultural Credit in the 2000s: An Explanation”, Economic and Political Weekly, December 29, 2007). These definitional changes broadly involved (a) recognising new forms of financing commercial, export-oriented and capital-intensive agriculture as “agricultural” credit; and (b) raising the credit limit of many existing forms of indirect financing. For instance, from 2007 onwards, two-thirds of loans given to corporates, partnership firms and institutions for agricultural and allied activities in excess of Rs.1 crore per borrower were considered as indirect finance to agriculture; the remaining one-third were treated as direct finance to agriculture.
In 1990, about 83 per cent of agricultural credit was of a size less than Rs.2 lakh. In 2009, however, only about 44 per cent of agricultural credit was of a size less than Rs.2 lakh.
An area of darkness 
Over recent weeks, reports of frequent and increasingly longer power cuts from across the country have added another layer of serious concern to India’s faltering growth story. What is unusual about these power outages is that they have been occurring during the months of October and November, when demand is traditionally low. The immediate causes of the power crunch are well known. There is a growing and acute shortage of coal, which is the mainstay of power generation in the country, accounting for over 50 per cent of overall capacity. Over the past four years, demand for coal, mainly for thermal power generation, has grown by 7.3 per cent, while domestic output rose by only 5.4 per cent. What is most worrying is the significant drop in investment in the power sector in view of uncertainties on fuel availability and uneconomic pricing of power. The target for additional power generation capacity in the current plan of 62,000 MW (already reduced from the original 78,000 MW) is likely to have a shortfall of as much as 12,000 MW, according to the Planning Commission.
Indian railways lag 20-25 years behind world on technology front: E Sreedharan
Thanks to E Sreedharan , MD, Delhi Metro Rail Corporation, India's capital has a world class metro. A project that was on drawing board for decades and which many thought would be almost impossible to execute is up and running. He took charge in 1997 when he was 65 years old, long after he retired from the Railways in 1990. Today at 79, he is finally hanging his boots on December 31 to retire in his native village in Kerala. He spoke to ET on Delhi Metro, its success and his life. Excerpts:
You retired from the Railways, what's your prescription for Railways future? ( Thanks to E Sreedharan , MD)
Indian Railways has the world's fourth-largest network with 9,000 engineers but it lags 20-25 years behind the world on the technology front, it needs to be upgraded dramatically. 

The present model of development is not sustainable and will increase crime in urban areas and increase disparity among India's population.

There is no need of targeting 9% growth, India should target 7% inclusive growth which will reduce poverty and increase quality of life.

Sunday, December 18, 2011

Tax exemptions for rich costs govt Rs 4.6 lakh cr - The Economic Times

Tax exemptions for rich costs govt Rs 4.6 lakh cr - The Economic Times:

'via Blog this'

NEW DELHI: The subsidy for the poor is dwindling, but this has not deterred the government from lining up corporate houses' pockets.

Last year, the Centre gave away potential revenue of Rs 4.6 lakh crore on account of various tax exemptions and incentives to industrialists, compared to the Rs 1.54 lakh crore on subsidy to poor and farmers.

If you are thinking government is very generous in giving different subsidies to poor, it is a big farce. Government is giving much more to the rich. This is not only in terms of tax exemptions but there are many more things.

This is biggest dilemma of Indian System, even though it looks and government make it look like pro poor but reality is very different.
The real benefit is going to rich middle class, the middle man or business class or Baniya ( in Indian Language). If we look at bank bank balance sheet, NPA is increasing and SBI which has lost almost 40% from pick price from lost year has highest NPA. These NPA are loans to rich which is killing the banks. Poors are not even entertained in these banks, almost 45% of rural population do not have even bank accounts. They are not part of inclusive development.

The whole story about development is for 30% middle and upper class. What ever remains will percolate down to poor. There are no efforts for grow and develop the villages.

Unfortunately poor are getting poor when India is growing, I will be more happy to see India growing at 6%-7% which is inclusive, I don't want 9% for rich excluding poor. Without inclusive growth, there can not be growth. Villages must be developed and there connectivity must be improved.

The only visible thing in development is Roads, roads are getting better and because of private investment phones  has increased but basic necessities remained stagnated. Developing infrastructure is core to the development.

Government must invest more in improving and increasing capacity of railway. Some of gauge conversion projects are going on for last 10 to 15 years. This must end, there must be time bound execution of projects in infrastructure, when minister changes, priorities become different this should go. There should be independent project to project budget and time line for execution. This is only way in successful project management. The quality of services are deteriorating day by day. This is ridiculous. Can not Railway has better management. Project execution and  management should be an independent part of Railways.

The second priority is Airport, India needs 300 airports, everybody is talking. Is there any real movement in the direction of implementing this project. Who will do it? How much years it will take to execute? These are key questions for this project.

There are many more questions, but no answers. One can not expect any answers.

Let us pray for the poor.

Thursday, December 15, 2011

The changing face of Financial Order

Hong Kong named world's top financial hub - Asia-Pacific - Al Jazeera English:

'via Blog this'

It is not surprising for me to see Hong Kong as worlds top financial hub. This indicates two things. The first thing is world order is changing. The old power house are now old horses impaired with many diseases, they can not win a race. Betting on such horses are use less.
USA has its own financial mess to manage. It has lived on others money for long time. China, Japan along with other countries invested in USA debt and finance the luxuries of life. This luxury financing has created two problems. The first is USA asset bubble, USA spent money on which they can not afford, this luxurious spending is hounding USA and others. I do not see any solution to this problem in foreseeable future. The solution is cleaning the toxic from the system, which no one wants. There is no alternative, cleaning the system from crooks, which is impossible. When there is no will to implement solution, the only alternative left is slow and painful death of US economy.

The second problem is the financing of surplus economy to USA has deprived the needy, underdeveloped and least developed and developing economies of this money. Which may have used to grow these economies. This financing has increased poverty in world. When it will be stopped then definitely a new economic order will emerge.

These least developed, under developed and developing economies will get surplus money to grow and reduce poverty. The change in direction of money flow will change everything. More employment is created and will get better healthcare.

The Asia with its population, China and India along with their neighbors and east Asian economies will see a major shift in near future.

Indonesia, Malaysia along with Saudi Arabia will play a major role in global financial markets.Singapore which is already a major financial hub for east asia, Mumbai, Dubai, Qatar are other financial hubs which are in contest to change the landscape of world order.

It may take some time but the process has started and soon it will pick up. With China coming with its own Sovereign Wealth Fund of USD 300 billion, along with SWF of Malaysia, UAE, Qatar, Singapore, Kuwait and other OPEC countries will see a major change.

Let us make this change a positive, to reduce poverty, and improve justice and equality in this world.

Friday, October 7, 2011

Girls are still killed

How much civilised are we

This is horror story of developing India. In this so called developed world we are killing daughters.
Islam has given them right and stopped the practice 1450 years ago. But still today we are living in world of Jahiliya.

I wrote before about India's Missing Girl Child. Where are we really going. What is the future of such society?

These are big questions and there is need to answer this?

The status of women in Islam.

Tuesday, July 5, 2011

Supreme Court to Uttar Pradesh Govt: Sinister campaign to grab land

New Delhi: The Supreme Court today slammed the authorities for taking advantage of the "colonial law" on land acquisition to divest farmers of their prime agricultural land benefitting the rich and paying "pittance" to common men.

The apex court said a "sinister campaign" has been launched by various state governments to take advantage of the law against the poor people for taking away the land and giving it to builders where multiplexes, malls, posh residential complexes are developed which are beyond the reach of common men.

"Do you think judges live in fools' paradise"? snapped a bench of Justices G S Singhvi and A K Ganguly when senior advocate P P Rao responded to a question that the residential complexes were being developed for the "needy".

"You are building hotels, malls, commercial complexes, townships where common men have no access. Does it come under the perception of public purpose for which the land have been acquired?"

The bench questioned the change by Uttar Pradesh government in land use in Greater Noida and said "this is not the plan for which the land is acquired. How different notifications came out for changing the use of land".

The sharp remarks were made by the bench during the hearing on petitions filed by Greater Noida Industrial Development Authority and real estate developers and builders, including Supertech and Amrapali, challenging the Allahabad High Court order which had quashed the notifications for land acquisition in Greater Noida adjoining the national capital.

The bench made it clear that it was not going to stay the High Court verdict and would go ahead with the hearing of the parties.

"We are indicating that we are not inclined to stay the order of the High Court. We are not inclined to entertain the special leave petition. We will ask only for your submissions," the bench said.

While Rao, appearing for Supertech, contended the development of residential complexes were for the "needy", the bench drew his attention to the brochure of the company saying "what is there in it is not for the poor people".

"Look at your own brochure. It is saying about swimming pool, spa, tennis court, badminton court, beauty parlour, ayurvedic massage etc. All these are for poor people?

"I am reading from your own brochure. Is it for a common man? Land is taken and given to the builder. This is a sinister plan," the bench said.

"Land is given for the development which must be inclusive. The state is taking advantage of the law against the poor. A sinister campaign is made by various state governments. The state is doing a totally anti-people thing," it said.

While maintaining that the purpose of the land acquisition was being defeated, the bench said the poorest man in society should benefit in public interest but "you (authorities) are responding in such a way that they (the poor and common men) are driven out".

"In the name of globalisation, you are marginalising the people. Why is there a proliferation of terrorist activities? Because they are pushed to the walls. Why so many people are committing suicide? They are marginalised. You are not taking care of them. Poor men cannot come to this court," the bench said.

The court expressed its anguish over the whole development in recent times where the emergency clause has been applied for acquiring land of farmers on the pretext of public purpose.

"The state is taking advantage of the colonial law. What you are giving to the common men is pittance," the bench said.

The High Court had on May 31 quashed acquisition of 170 hectares of land at Gulistan village in Greater Noida for industrial development.

The High Court had said that acquisition of land in Greater Noida for residential apartments, which was done after invoking Section 17 of Land Acquisition Act depriving the aggrieved persons of the chance to file their objections on the ground that the matter was urgent, was a "colourable exercise of power" and had quashed the notification.

The counsel, appearing for Greater Noida Industrial Development Authority, contended the acquisition was part of its "well-known" 2021 plan called the Industrial Development Plan which is a generic term that includes commercial and residential use.

The High Court order had come on the plea of landowners and farmers who challenged the government notification for land acquisition issued on September 5, 2007.

Sunday, April 10, 2011

India's Development Challenge

India's Development Challenge - Safe Drinking Water

Monday, February 14, 2011

Change.........Change.......India is Waiting.......

Change ………….Change…………Change………India Need a Change

Abaki Baari …………

Give me a Chance! ………..Who else ……….. L. K. Advani (P M in Waiting)

World has seen lot of things changing so fast and so dramatic in last one month that no one has imagined.

Revolution in Tunisia,,,,,,,,,, Egypt ………….and ……..many more are waiting. This will change the world may be for ever and diplomacy of the world.

Even though India is known for non violence movement ( Ahimsa) by Bapu but today even though it is high time India should change, but do we have leaders!

Leaders are born……………with revolution……….if we look at those who are around Baapu or around J P they are all young.

Yes ………Lalu Prasad Yadav
Mulayam singh Yadav
Sharad Yadav
George Fernandece
And Nitish Kumar
Ramkrishna Hegde

All are product of J P movement. They are young………and dedicated to the nation building………… fought and won.

One more J P movement is required to remove corruption from the society. The corrupt system needs a overall. “Change means Change”

A people government means peoples government, accountable to the people.

India needs a change?

But it should not be change of face only.

Our P M in waiting is there L K Advani but he has a hard battle ahead and yes.

“ Clean means Clean” no other hidden meaning.

India needs accountable and responsible government , a Government which really want change.

For all this “A Young Leader” with a dream of future India is required.

There are no place for Dynasties and Prince in this, only the one deserves will get it.

India of 22nd Century…….. Developed and peaceful and ethical co existence where no one is exploited and no one is oppressed.

Where there is no place for color, class, and caste........everyone is eligible unless declared ......clean , ethical, transparent and accountable.

Tuesday, August 11, 2009

India 9 percent Inclusive Growth Issues and Challenges

India Growth Story

In the previous post I have written about farmer’s suicide and status of poverty in India. In this post I am talking about how it can be managed and reduced.

Seasonal Rainfall Scenario (1 June to 29 July)

The cumulative seasonal rainfall for the country as a whole during this year’s monsoon has so far been 19% below the Long Period Average (LPA). Progressive cumulative rainfall departure from LPA during monsoon season 2009 for the country as a whole and over the four broad homogeneous regions of India are given below
Out of 36 meteorological sub-divisions, the cumulative rainfall during 1 June to 29 July 2009 was excess/normal in 17 and deficient in 18 and scanty over 1 (West Uttar Pradesh) meteorological sub-divisions.

Can we Change Monsoon?

No, we can’t do anything to it. It was like this for all the time, it is becoming more and more unpredictable so because of Global Warming.
This reminds of what the former Finance Minister of Pakistan and the author of the UNDP's Human Development Report, the late Mahbub-ul-Haq (who was a personal friend of Dr Manmohan Singh) had once remarked, ''We were wrongly taught that we should take care of GDP and it will automatically take care of poverty. Let us reverse it. We need to take care of poverty and it will automatically take care of GDP". And the World Bank reluctantly acknowledged, though belatedly, ''the gap between some of India's largest and poorest states exhibit slow progress in human development indicators; low growth rates particularly in the agricultural sector. If the present trends continue, the bulk of the poor in these states will be unable to participate in future growth.'' Like Mr. Chidambaram, Mahbub-ul-Haq too refused to accept the stark reality – economic growth will not reduce poverty and deprivation.

India Growth Story

India’s economy has come a long way, especially since the start of this century. It is impossible to ignore India’s rise in every field.
GDP at market prices has increased from US$ 20 billion in 1950-51 to US$ 912 billion in 2006-07 and is expected to cross a trillion dollars in the current year. In terms of purchasing power parity (PPP), India’s GDP at US$ 4 trillion in 2006-07 accounted for 6.3 per cent of global GDP.
Average annual economic growth, which had been constant and tardy at 3.5 per cent during the first thirty years of Independence, increased to 5.7 per cent during the 1990s and, since 2003-04, the average rate has increased further to 8.6 per cent. 2006-07, in particular, was a splendid year with the GDP growing at 9.4 per cent.

This growth has not been jobless growth. During 1999-2000 to 2004-05, India added to its workforce about 12 million people each year. During this period, the rate of growth of employment was 2.9 per cent per year.

Present Status of Poverty and Employment in India

Protectionism, self-reliance and village republics are not enough to lift 1.3 billion of the world’s poor out of absolute poverty. There is sufficient empirical evidence to demonstrate that trade can be a powerful catalyst for poverty reduction, that free trade with fairer policies will benefit the world's poor more than aid or charity. The problem is that World Trade Organization negotiations and global trade are far from free and fair, with the balance skewed in favor of powerful trading blocs like the US and EU and against poorer nations

Employment Generation

The latest Economic Census of India 2005 reports that rural India witnessed a higher rate of employment-generation in recent years compared to urban India
Rural India has outshone its urban counterpart in generating employment, reports the latest Economic Census of India 2005. In the average annual growth in employment since 1999-2000, with employment growth rates of 3.33%, rural areas have outperformed the urban sector, which registered a rate of 1.68%, according to provisional results of the census. Interestingly, the results also show that 42.12 million enterprises are engaged in various economic activities other than crop production and plantation.
If poverty reduction is an explicit over-riding concern, any programmed, project or policy must be evaluated for its effects on this, which means assessment of its impact on poorer populations in terms of:
productive employment opportunities

access to and price of basic food requirements

access to basic housing/shelter requirements

access to and price of basic infrastructure services, including power, water, sanitation

access to and price of health services

access to and price of education services

access to and voice in the institutions of governance and administration

Focusing on all these indicators in turn imply that poverty is viewed as a multi-dimensional phenomenon, rather than simply in terms of nutritional deprivation, and the effects of material poverty on social exclusion are also recognized.

Trust on Agriculture

Studies by the Ministry of Agriculture have clearly demonstrated that farm incomes have fallen in the past five years. Rice farmers in West Bengal for instance earn less by 28 per cent in 2002-03 than what they earned in 1996-97. Incomes of sugarcane farmers decreased in Uttar Pradesh by 32 per cent and in Maharashtra by 40 per cent. Farm incomes of north Indian farmers eroded by 10 per cent on an average. The sharp decline in farm incomes is happening at a time when incomes in the urban areas are on an upswing. Add to it the declining consumption of cereals in real terms, the message is crystal clear. For bulk of the population, the capacity to buy food is eroding fast. This is leading to worsening of poverty and thereby leading to acute malnutrition. The Economic Survey, presented a day before the Budget, clearly stated that cereal consumption within a year had fallen drastically, indicating worsening poverty levels.
The HDI for India is 0.619, which gives the country a rank of 128th out of 177 countries with data

This year’s HDI, which refers to 2005, highlights the very large gaps in well-being and life chances that continue to divide our increasingly interconnected world. By looking at some of the most fundamental aspects of people’s lives and opportunities it provides a much more complete picture of a country's development than other indicators, such as GDP per capita. Figure illustrates those countries on the same level of HDI as India can have very different levels of income.
Of the components of the HDI, only income and gross enrolment are somewhat responsive to short term policy changes. For that reason, it is important to examine changes in the human development index over time

One suicide every 8 hours

Vidarbha remains a grim statistic. One suicide in every eight hours. More than half of those who committed suicide were between 20 and 45, their most productive years. The Maharashtra government says as many as 1920 farmers committed suicide between January 1, 2001 and August 19, 2006. Nearly 2.8 million of the 3.2 million cotton farmers are defaulters, reports Jaideep Hardikar

India's Growth - Luxury for the rich, squalor for the poor

"India is one land, but the rich and poor exist on apparently different planets. Virtually unreported are some awful daily realities: the rate of malnutrition in children under five is a shamefully high 45%. Less than a third of India's homes have a toilet and most women have to wait until the dark of evening to venture out to answer the call of nature. The talk of making poverty history sounds hollow in India, a land which is home to a third of the world's poor and where some 300 million people live on less than $1 a day."
Even in macroeconomic terms India is still poor and small. It holds a sixth of the world's population but accounts for just 1.3% of world exports of goods and services, and 0.8% of foreign direct investment flows.
Even the investment that is trickling in is becoming more and more capital intensive rather than labour intensive. Hence this whole propaganda that investment creates more jobs is being proven to be utterly false in India.
In urban India this whole phenomenon of liberalization is playing havoc with city dwellers. As India's famous novelist and social activist Arundhati Roy put it, "This project of corporate globalization has created a constituency of very rich people who are very thrilled by it. They do not care about the hawkers being cleared from the streets or the slums that are disappearing overnight. India is not coming together but coming apart because liberalization has convulsed the country at an unprecedented unacceptable velocity."
Now half of Delhi's 14 million inhabitants live in slums and 18,000 structures outside of slum clusters have been deemed illegal. But if this capitalist aggression is devastating the lives of the workers and the urban poor, it has had a more devastating effect in the villages where 70% of India's population lives. As Roy says, "Where India does not live, it dies."
There have been reports of the phenomenon of endemic farmer suicides across India. In some states it worse than in others. The arrival of new pesticides, genetically modified seeds and swanky tractors that soak up increasingly expensive fuel have pushed up the cost of production.

First cousins: The ties between rural and urban India

At 27.8% of the total population, India’s level of urbanisation remains quite low. But that’s still 285 million urban citizens, a number that would constitute the fourth-largest nation in the world. To feed these ever-consuming cities electricity, water and natural resources, the habitats of rural India are becoming more and more depleted, forcing further migration into the cities
Thus, as urban studies scholars such as Amitabh Kundu have time and again pointed out, the level of urbanization in India actually remains quite low even though its contribution to the national economy has become extremely high--calculated at 60% in 2001.
But unfortunately, a hard-headed study of urban habitats around the world reveals that their goals may just not be achieved. And this could have everything to do with the situation of the 745 million rural Indians that shadow the horizon of all Indian cities. A shadow that may darken over a period of time when one finds that to feed the ever-consuming cities with electricity, water and natural resources, the habitats of rural India gradually become more and more depleted, forcing larger and larger numbers to migrate to cities, thereby further straining resources, especially since all the existing policies are doing little to absorb the needs of the urban poor.

Commitment to reduce Poverty Is Lacking

The ministry of water resources had demanded Rs 4,500 crore for the completion of major irrigation projects in the coming Budget.
The state governments' failure to complete irrigation projects has led to an escalation of their combined cost by close to a whopping one lakh crore rupees. According to the Planning Commission, 383 irrigation projects in 23 states have spilled over from the Ninth Five-Year Plan to the tenth plan.These projects were to irrigate more than 20 million hectares, reducing the farmers' dependence on the monsoon. By the end of the ninth plan, only 35 per cent of the area was covered. The delay in implementation is attributed to several factors. For one, the allocation to the sector in the Union budget has been coming down, point out sources. Another reason is that the number of irrigation projects has been increasing over time, without the earlier ones getting completed.

Agriculture as Thrust Area

Agriculture plays an important role in the rural economy of India. This sector provides gainful employment as well as raw materials for a large number of industries in the country. Of late, amid economic reforms and trade liberalization, considerable changes have been noticed in this sector. The reform process introduced in the early 1990s failed to recognize the crucial importance of this sector due to which it has faced serious difficulties. These difficulties manifested in a variety of forms like loss of livelihood, consequent decrease in purchasing power of the rural masses, and a steady increase in input prices crippling the agricultural producers. Complete failure of land reform programmes in turn resulting in a distorted land holding pattern, the crisis in this sector during the post-liberalisation has aggravated.
Looking at the core concerns of this sector, the growth of this sector in terms of increased public investment is of immense necessity at this juncture to revive the fate of the rural economy of India.
Looking at the expenditure pattern of the present government towards agriculture and allied activities, the share of agriculture and allied activities from total expenditure and GDP declined drastically to 10.37 percent and 1.64 percent respectively compare to the previous budget (2008-09 RE). The obvious conclusion from this expenditure trend shows how committed is present UPA government at the centre towards reviving the rural economy of India as more than 52 percent of the total population of India depends on agriculture as their means of livelihood.
Graph-1: Percentage Distribution of Plan Allocations in Agriculture and Allied Activities Since the Seventh Five Year Plan
Source: Compiled from the data given in Economic Survey, 2007-08, GoI

Plan expenditure shows the commitment of the government towards the overall development of that sector over the plan period. Share of plan investment (both Center and States/UTs) in agriculture sector has been declining since 1985. Declined share of investment in agriculture shows that less priority has been accorded to this sector. During the Seventh Five Years Plan, the share of plan investment in agriculture and allied activities out of total plan investment was 5.8 % and this got reduced to 3.7 % in the proposed Eleventh Five Year Plan.
The Solution
There can’t one single pill which can solve the Problem, we need step by step approach. And first of this step is Reducing dependence on Rain fed Farming and Monsoon

Step 1

Water Conservation

  • Farm Level

  • Village Level

  • Taluka Level

  • State Level

  • National Level


(TBS) built many check dams in Alwar district, in the 503 sq km watershed of the 45-km-long Arvari river some 238 water harvesting structures had been constructed by the mid-1990s by the 70 villages located within its watershed. The work started in 1986 and, lo and behold, the Arvari, till then a drain that flowed during the monsoon did not dry up but slowly became a perennial river. In 1990, it had a flow till October and, by 1995, it had become perennial. tbs now lays claim to revival of five rivers.
Hydrogeologist R N Athavale who visited the Arvari watershed has made the following estimates based on his experience to explain the revival of rivers. Earlier, only 15 per cent of the rainfall would go into the soil 5 per cent becoming soil moisture and about 10 per cent going deep into the ground, most of it below the bottom of the wells and the level of the Arvari bed because of the depleted groundwater reserve. Therefore, only 5 per cent of the rainfall would slowly seep into the Arvari and villagers could use just about 1 per cent for drinking and irrigation. Now, with check dams, 35 per cent goes into the soil instead of 15 per cent. As a result, the monsoonal runoff to the Arvari has dropped from the earlier 35 per cent of the rainfall to only 10 per cent. But an estimated 22 per cent of the total rainfall now seeps into the Arvari from the recharged groundwater reserve in the post-monsoonal months to give it a perennial flow. The villagers themselves now use about 3 per cent of the total rainfall that falls in the watershed with which they can take two crops a year.