30 August 2014

Measure taken by govt to revive the economy,now showing the result

Steps Taken by the Government Starts Showing Results: GDP Shows A Growth Rate Of 5.7 Per Cent in Q1 Of 2014-15 Over the Corresponding Quarter of the Previous Year; Headline WPI Inflation Comes Down to 5.1 Per Cent in July 2014 Among Others
When the new Government came to power around three months ago, it faced various challenges on economic front. The economic growth was showing a downward trend, the inflation was alarmingly high, unemployment rate was worrisome and corruption was touching new heights.
The new government took various steps for boosting growth, controlling inflation and curbing corruption among other measures. The Union Budget 2014 was its first path breaking effort to tackle all these issues upfront. Now all these efforts have started showing results:
GDP growth is showing early signs of recovery. In FY14 India’s economy grew at 4.7 per cent. As per the Central Statistics Office (CSO) data released yesterday Quarterly GDP at factor cost at constant (2004-2005) prices for Q1 of 2014-15 is estimated at Rs14.38 lakh crore, as against Rs13.61 lakh crore in Q1 of 2013-14, showing a growth rate of 5.7 per cent over the corresponding quarter of previous year.
The economic activities which registered significant growth in Q1 of 2014-15 over Q1 of 2013-14 are ‘electricity, gas & water supply’ at 10.2 per cent, ‘financing, insurance, real estate and business services’ at 10.4 per cent and ‘community, social and personal services’ at 9.1 per cent. The estimated growth rates in other economic activities are: 4.8 per cent in ‘construction’, 3.5 per cent in ‘manufacturing’, 2.8 per cent in ‘trade, hotels, transport and communication’, 3.8 per cent in ‘agriculture, forestry & fishing’, and 2.1 per cent in ‘mining & quarrying’ during this period.
·         GDP growth is one of early signs of economic recovery. In FY 14, India’s economy grew at 4.7 per cent. We expect the economy to grow at 5.7-5.9% during the current FY and in 2-3 years time reclaim the high growth rate of 7%.
·          Headline WPI Inflation after remaining persistent  around 7-9 per cent during 2011-13 is showing signs of moderation and has come down to 5.19% in July, 2014.
·         Consumer Price Index has fallen from the levels of 8.6% in April, 2014 to 7.96% in July, 2014.
·         On account of restored business confidence and improved order book, manufacturing is showing signs of rebound and HSBC PMI has risen to 53 in July, 2014 from 51.5 in June, 2014.
·         Due to concessions in Excise duty, Passenger Vehicles sales have grown for the third month in a row, growing by 7.1% Year to Year in July, 2014.
·         Growth of 23% in the Capital goods production IS. a healthy indicator of recovery.
·         India`s annual infrastructure sector growth ( eight core sector) hit a nine-month high of 7.3 per cent in June, led by a surge in cement and electricity output.Due to increased foreign flows India’s Foreign Exchange Reserves have seen a surge and as in July end were USD 320.6 billion. This is USD 43.4 billion higher than a year ago.
·         Despite less than satisfactory Monsoon, food stock in Central pool is comfortable at nearly 62 million tones.
·         For ensuring macroeconomic stability Current Account Deficit will be contained within 2% and Fiscal deficit within 4.1% of GDP during CFY.
In the first Budget of this Government certain steps which are only the beginning of a journey towards a sustained growth of 7-8 per cent within the next 2-3 years were outlined.
The Government is committed to the principle of “Minimum Government Maximum Governance”. In the budget it was committed to constitute an Expenditure Management Commission, which will look into various aspects of expenditure reforms including rationalisation of subsidies, to be undertaken by the Government.Since then the Commission has been constituted with the noted economist and Ex-Governor of RBI, Dr. Bimal Jalan heading it.
Besides above, the Government has already expressed through the Budget 2014-15 its intent to fulfil the promises made to the electorate.
The Annexure covers:
·         Some of the key promises made to the electorate and achievements made in that regard.
·         Pro Poor and Pro Business measures in the Budget 2014-15.
·         Structural Reforms Announced in the General Budget 2014-15.

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DSM/RW



Annexure
Some of the key promises made to the electorate and achievements made in that regard:
1.      Tackling price rise and corruption:
·         Price Stabilization fund set up with an initial amount of Rs. 500 crore.
·         Special Investigation team set up on Black money. Measure appreciated by SC.
·         Dehoarding measures taken by the Government in consultation with States.
·         Inflation has been contained within reasonable limits despite vagaries of weather.
·         Measure taken to improve the supply side deficiencies through improving productivity such as soil health card, adaptation fund to mitigate risks of climate change and enhanced agricultural credit. Initial allocations of Rs 100 crores have been made for the Mission for Soil health card and for National Adaptation Fund.
·         Additional allocation of 50 lakh tonnes of Rice to BPL and APL families in the States and UTs for period upto March, 2015.
·         Allocation of Wheat under Open market for stabilizing cereal prices.
·         Committee set up to review the economic cost of the food grains payable to FCI.

2.      Widening the platform through empowerment, creation of opportunities through job creation,
bridging infrastructure deficits and skill upgradation.
·         Allocation for rural roads (Rs14,389 crore) , national highways (Rs 37,880 crore) and Railways(Rs 30,100 crore) enhanced in the Budget.
·         Expansion of telecom network in NE and LWE areas.
·         Digital India for improved access. An initial allocation of Rs 500 crore.
·         Initial allocations done for skill development and rural entrepreneurship programme(Rs 100 crore);
·         Amendments’ to Apprenticeship Act proposed.

3.      Improving decision making.
·         Abolition of system of GOMs and EGoM.
·         Convergence of objectives within Ministries/Departments for greater focus.
·          Multiple layers in decision making to be pruned.
·         Revision in the delegation of powers for appraisal and approval of projects/schemes to the administrative Ministries in final stages of approval.

4.      Improved programme delivery.
·         Convergence in the programme objectives for improved delivery.
·         Targeting of benefits to be improved through use of DBT or AADHAR card.
·         Expenditure management commission set up for making recommendation for improvement in programme delivery.

5.      Strengthening federal polity.
·         Royalty on natural resources enhanced.
·         Waiver of interest due to FCI on outstanding dues of State of J&K.
·         NER power system improvement project appraised and approved.
6.      E-Governance as a vehicle for improving governance.
·         Digital India programme approved for improved governance.
·         IT based single window platform “e-BIZ” for providing single window clearance for business.
·         IT based education tools to be widely used in Government programmes.
·         Initial steps of creation of manpower infrastructure for e-VISA done.
·         Updating of National register of citizens under NPR in Assam approved by FM.

7.      Institutional reform.
·         For bringing in reforms in judicial selection process Constitutional amendment passed by Parliament;
·         Planning Commission to be replaced by a new body.
·         Expenditure management Commission set up.

8.      Increase in farmers income;
·         Enhanced agricultural credit to Rs 8 lakh crore.
·         Steps to reduce variability on farm produce such as PMKSY. An initial allocation of Rs 1000 crore made, Programme has been devised and necessary appraisal is being done.
·         Institutional finance to 5 lakh joint farming groups of “BhoomiHeenKisan”.

9.      Making India a global manufacturing hub on the principle of “Make in India.
·         Tax incentives on both direct and indirect side extended to business.
·         Tax regime made more predictable and investor friendly through improved system of advanced ruling and dispute settlement.
·         Expanding the scope of definition of MSME.

10.  Equal opportunities for disadvantaged;
·         Van bandhukalyanyojana for tribals. Initial sum of Rs 100 crore.
·         Scheme for Madarasa modernization. Initial sum of Rs 100 crore.
·         Specific measures for women empowerment such as BetiBachaoBetiPadhao, small savings scheme for girl child and protection of women in distress.
·         One stop centre for women affected by violence- Nirbhaya Centre appraised for final approval.

11.  Meet aspirations of the neo-middle class.
·         Increase in Income Tax Act 80C benefit from Rs 1 lakh to Rs 1.5 lakh.
·         Exemption limit raised by Rs 50000 from Rs 2 lakh to Rs 2.5 lakh.
·         Exemption limit raised for Senior Citizens from Rs 2.5 lakh to 3 lakh.
·         Plan to set up 100 smart cities and improvement in facilities in the existing urban areas.
·         FDI conditions relaxed for development of housing. Requirement of built up area reduced from 50000 sq meter to 20000 sq meter.
·         For improved housing Incentives for Real Estate Investment Trusts (REITS). Complete pass through for the purpose of taxation.
·         For passenger facilitation, free baggage allowance increased from Rs 35,000 to Rs 45,000.

12.  Extending urban facilities in Rural areas.
·         Shyama Prasad Mukherjee RURBAN Mission announced.

13.  Improving Urban centres.
·         New Metro’s in Ahmadabad,  Lucknow and Nagpur.
·         100 smart cities programme.
·         Through ‘Swacch Bharat’ sanitation to be improved.
·         500 urban habitations to be provided support for infrastructure and services renewal through PPP in next 10 years.

14.  Revitalizing education in India.
·         Improvement in teachers quality through a teachers training programme. An initial allocation of Rs 500 crore for “Madan Mohan Malviya New Teachers Training programme”.
·         Simplification of norms for higher education loans.
·         School Assessment Programme launched with an initial amount of Rs 30 crore.

15.  Improving sanitation.
·         Action points decided under Swacch Bharat Abhiyaan .
·         These include provision of integrated toilet component in relevant programmes, convergence of all existing related programme, CSR and other sources of funding to supplement efforts and intensive awareness programme.

16.  River and Water conservation.
·         NamamiGange programme launched with an initial allocation of Rs 2037 crore to clean Ganga.
·         Administrative restructuring for expeditious results in the area of water resources conservation;
·         DPR for linking of Rivers and Ghat works

17.  Ensuring diversity in energy mix for hedging risks arising out of over dependence on one source.
·         Encouragement to renewable sources of energy such as Wind and Solar.
·         Green energy corridor to be developed.
Budget contains and outlines intent to carry out many of the reforms indicated above. Apart from Budget Government has undertaken other reforms as well. It may be recalled that decision to set up a Special Investigation Team on Black money was set up in the 1st Cabinet meeting. Similarly, amendment to judicial selection process as part of institutional reforms or streamlining of administrative structures is not a part of the Budget.
Pro Poor and Pro Business measures in the Budget
General Budget 2014-15 fully respects the promises made by the new the Government especially to the poor people. The Government sees relation between pro business and pro poor measures as one of complementarity and not of conflict. Necessary financing required for welfare measures for the poor can only be obtained through a wider resource base derived from a vibrant business environment. Promises made by the Government and steps taken in the Budget have to be seen in this light. For the welfare of poor various measures have been taken by the Government in the Budget, major among which are.

Pro poor measures

·         The subsidy regime to be made more targeted for full protection to the marginalized, poor and SC/ST. Expenditure Management Commission constituted by the Government  to look into these issues and make its interim recommendation before end of the FY.
·         Time bound programme as Financial Inclusion Mission to be launched on 15 August this year with focus on the weaker sections of the society.
·         Income Tax exemption ceiling enhanced to Rs 2.5 lakh from Rs 2 lakh.
·         Limit under 80 C of Income Tax Act enhanced to Rs 1.5 lakh from 1 lakh. 
·         Investment limit in PPF enhanced to 1.5 lakh and other Small savings instruments such as KVP to be reintroduced.
·         More productive, asset creating and with linkages to agriculture and allied activities wage employment would to be provided under MGNREGA.
·         For improving road connectivity in rural areas allocation of Rs 14389 crore made under PMGSY.
·         Allocation for National Housing Bank increased to Rs 8000 crore to support Rural housing.
·         Employment exchanges to be transformed into career centers. A sum of Rs 100 crore provided.
·         “Start Up Village Entrepreneurship Programme” for encouraging rural youth to take up local entrepreneurship programs.
·         Under Ajeevika, the provision of bank loan for women SHGs at 4% extended to another 100 districts.
·          For the welfare of the tribals “Van BandhuKalyanYojna” launched.
·         Varishtha Pension BimaYojana (VPBY) revived for a limited period from 15 August, 2014 to 14 August, 2015 for the benefit of citizens aged 60 years and above. This was there under previous NDA Government.
·         Provisions made for enhanced benefits to the EPF scheme and a Universal account number for contributing members.
·         For visually challenged currency notes with Braille design and scheme for assistance to disabled persons for purchase of aids and appliances.
·         Measures for safety of women on Public transport system and ‘Crisis management centers’ for women in distress.
·         Programme for improving access of the poor to clean drinking water and sanitation.
·         Improved irrigation facilities through ‘Pradhan Mantri Krishi Sinchaee Yojana’.
·         Betibachao, BetiPadhao campaign and special small savings instrument for the girl child.
·         Free drug and diagnosis services for all.
·         Improvement in access to medical facilities and super specialty treatment by enhancing medical infrastructure through opening of new AIIMS like institutions.
·         National programme in Mission Mode to halt the deteriorating malnutrition situation in India.
·         Enhanced allocation under SSA programme for universal education.
·         A new programme for improving the quality of teachers for bridging the teaching gaps.
·         Toilets in all the schools for girl child.
·         To bridge the gap between digital haves and have not’s a programme on Digital India.
·         Kisan TV for bridging the Information gaps of farmers.
·         Mission on Low Cost Affordable Housing anchored in the National Housing Bank to be set up. 
·         A sum of Rs 4000 crores for NHB from the priority sector lending shortfall with a view to increase the flow of cheaper credit for affordable housing to the urban poor/EWS/LIG segment is provided
·         Slum development to be included in the list of Corporate Social Responsibility (CSR) activities to encourage the private sector to contribute more.
·         Poor are most vulnerable to effects of Climate change. A National adaptation fund set up.
·         Price Stabilization Fund to cushion the poor from the impact of inflation.
·         To provide institutional finance to landless farmers, it is proposed to provide finance to 5 lakh joint farming groups of “BhoomiHeenKisan” through NABARD.
·         Sum of Rs 200 crore for NABARD’s Producers Development and Upliftment Corpus (PRODUCE) for building 2,000 producers organizations over the next two years.
·         Skill India to be launched to skill the youth with an emphasis on employability and entrepreneur skills.

Pro-Business Measures

·         Sovereign right of the Government to undertake retrospective legislation to be exercised with extreme caution and judiciousness keeping in mind the impact of each suchmeasure on the economy and the overall investment climate.
·         A stable and predictable taxation regime which will be investor friendly and spur growth.
·         Legislative and administrative changes to sort out pending tax demands of more than Rs 4 lakh crore under dispute and litigation.
·         Resident tax payers enabled to obtain on advance ruling in respect of their income-tax liability above a defined threshold.
·         Measures for strengthening the Authority for Advance Rulings.
·         Convergence with International Financial Reporting Standard (IFRS) by Adoption of the new Indian Accounting Standards (2nd AS) by Indian Companies.
·         Government to promote FDI selectively in sectors.
·         The composite cap of foreign investment to be raised to 49 per cent with full Indian management and control through the FIPB route.
·         The composite cap in the insurance sector to be increased up to 49 per cent from 26 per cent with full Indian management and control through the FIPB route.
·         Requirement of the built up area and capital conditions for FDI reduced from 50,000 square meters to 20,000 square meters and from USD 10 million to USD 5 million respectively for development of smart cities.
·         The manufacturing units to be allowed to sell its products through retail including E-commerce platforms.
·         Incentives for Real Estate Investment Trusts (REITS). Complete pass through for the purpose of taxation.
·         A modified REITS type structure for infrastructure projects as the Infrastructure Investment Trusts (INVITS).
·         Central Government Departments and Ministries to integrate their services with the e-Biz -a single window IT platform- for services on priority by 31 December this year.
·         Rs 100 crore provided for setting up a National Industrial Corridor Authority.
·         Amritsar Kolkata Industrial master planning to be completed expeditiously.
·         Master planning of 3 new smart cities in the Chennai-Bengaluru Industrial Corridor region, viz., Ponneri in Tamil Nadu, Krishnapatnam in Andhra Pradesh and Tumkur in Karnataka to be completed.
·         Perspective plan for the Bengaluru Mumbai Economic corridor (BMEC) and Vizag-Chennai corridor to be completed with the provision for 20 new industrial clusters.
·         Development of industrial corridors with emphasis on Smart Cities linked to transport connectivity to spur growth in manufacturing and urbanization will be accelerated.
·         Apprenticeship Act to be suitably amended to make it more responsive to industry and youth.
·         Definition of MSME to be reviewed to provide for a higher capital ceiling.
·         Committee to examine the financial architecture for MSME Sector, remove bottlenecks and create new rules and structures to be set up and give concrete suggestions in three months.     
·         Entrepreneur friendly legal bankruptcy framework will be developed for SMEs to enable easy exit.
·         An institution to provide support to mainstreaming PPPPs called 4PIndia to be set up with a corpus of Rs 500 crores.
·         Comprehensive measures for enhancing domestic coal production are being put in place.
·         Adequate quantity of coal will be provided to power plants which are already commissioned or would be commissioned by March 2015.
·         An exercise to rationalize coal linkages to optimize transport of coal and reduce cost of power is underway.
·         Introduction of uniform KYC norms and inter-usability of the KYC records across the entire financial sector.
·         Introduce one single operating demat account.
·         Uniform tax treatment for pension fund and mutual fund linked retirement plan.
·         Investment allowance at the rate of 15 percent to a manufacturing company that invests more than Rs25 crore in any year in new plant and machinery. The benefit to be available for three years i.e. for investments up to 31.03.2017.
·         Investment linked deduction extended to two new sectors, namely, slurry pipelines for the transportation of iron ore, and semi-conductor wafer fabrication manufacturing units.
·         10 year tax holiday extended to the undertakings which begin generation, distribution and transmission of power by 31.03.2017.
·         Income arising to foreign portfolio investors from transaction in securities to be treated as capital gains.
·         Concessional rate of 15 percent on foreign dividends without any sunset date to be continued.
·         Banks to be encouraged to extend long term loans to infrastructure sector with flexible structuring.
·          Banks to  be permitted  to  raise  long  term  funds  for  lending  to infrastructure  sector with minimum regulatory pre-emption such as CRR, SLR and Priority Sector Lending (PSL).
·         Bill to increase the FDI limit in insurance sector introduced in Parliament.
·         Introduction of a “Roll Back” provision in the Advanced Pricing Agreement (APA) scheme so that an APA entered into for future transactions is also applicable to international transactions undertaken in previous four years in specified circumstances.
·         Introduction of range concept for determination of arm’s length price in transfer pricing regulations.
·         To allow use of multiple year data for comparability analysis under transfer pricing regulations.
·         60 more AyakarSevaKendras to be opened during the current financial year to promote excellence in service delivery.
·         To encourage new investment and capacity addition in the chemicals and petrochemicals sector, basic customs duty reduced on certain items.
·         To boost domestic manufacture and to address the issue of inverted duties, basic customs duty (BCD) reduced on certain items.
·         Colour picture tubes exempted from basic customs duty to make cathode ray TVs cheaper and more affordable to weaker sections.
·         To encourage production of LCD and LED TVs below 19 inches in India, basic customs duty on LCD and LED TV panels of below 19 inches reduced from 10 percent to Nil.
·         To give an impetus to the stainless steel industry, increase in basic customs duty on imported flat-rolled products of stainless steel from 5 percent to 7.5 percent.
·         Concessional basic customs duty of 5 percent extended to machinery and equipment required for setting up of a project for solar energy production. 
·         Specified inputs for use in the manufacture of EVA sheets and back sheets and flat copper wire for the manufacture of PV ribbons exempted from basic customs duty.
·         Reduction in basic customs duty from 10 percent to 5 percent on forged steel rings used in the manufacture of bearings of wind operated electricity generators. Exemption from  SAD of 4 percent on parts and raw materials required for the manufacture of wind operated generators.
·         Concessional basic customs duty of 5 percent on machinery and equipment required for setting up of compressed biogas plants (Bio-CNG).
·         Anthracite coal, bituminous coal, coking coal, steam coal and other coal to attract 2.5 per cent basic customs duty and 2 per cent CVD to eliminate all assessment disputes and transaction costs associated with testing of various parameters of coal.
·         Basic customs duty on metallurgical coke increased from Nil to 2.5 percent in line with the duty on coking coal.
·         Duty on ship breaking scrap and melting scrap of iron or steel rationalized by reducing the basic customs duty on ships imported for breaking up from 5 percent to 2.5 percent.
·         To prevent misuse and avoid assessment disputes, basic customs duty on semi-processed, half cut or broken diamonds, cut and polished diamonds and coloured gemstones rationalized at 2.5 percent.
·         To encourage exports, pre-forms of precious and semi-precious stones exempted from basic customs duty.
·         Duty free entitlement for import of trimmings, embellishments and other specified items increased from 3 percent to 5 percent of the value of their export, for readymade garments.
·         To incentivize expansion of processing capacity, reduction in excise duty on specified food processing and packaging machinery from 10 percent to 6 percent.
·         Reduction in the excise duty from 12 percent to 6 percent on footwear of retail price exceeding Rs 500 per pair but not exceeding Rs 1,000 per pair.
·         To develop renewable energy, various items exempted from excise duty.
·         Exemption to PSF and PFY manufactured from plastic waste and scrap including PET bottles from excise duty with effect from 29th June, 2010 to 7th May, 2012.
·         Prospective levy of a nominal duty of 2 percent without Cenvat benefit and 6 percent with Cenvat benefit on such PSF and PFY.
·         Concessional excise duty of 2 percent without Cenvat benefit and 6 percent with Cenvat benefit on sports gloves.
·         Steps taken to boost domestic production of electronic items and reduce our dependence on imports.  These include imposition of basic customs duty on certain items falling outside the purview of IT Agreement, exemption from SAD on inputs/components for PC manufacturing, imposition of education cess on imported electronic products for parity etc.
·         Provision of services rules to be amended and tax incidence to be reduced on transport of goods through coastal vessels to promote Indian Shipping Industry.
·         Service tax exempted on loading, unloading, storage, warehousing and transportation of cotton, whether ginned or baled.
·         24X7 customs clearance facility extended to 13 more airports in respect of all export goods and to 14 more sea ports in respect of specified import and export goods to facilitate cargo clearance.
·         ‘Indian Customs Single Window Project’ to facilitate trade, to be implemented.



Structural Reforms Announced in the General Budget 2014-15

4.1 per cent fiscal deficit a daunting task in the backdrop of two years of low GDP growth, static industrial growth, and moderate increase in indirect taxes, subsidy burden and not so encouraging tax buoyancy. The government is committed to achieve this target.  Road map for fiscal consolidation outlines fiscal deficit of 3.6 % for 2015-16 and 3 % for 2016-17.Bold steps required to enhance economic activities and spur growth in the economy.  To achieve this various structural reform initiatives were announced in the General Budget 2014-15, summarized as below:
·         The subsidy regime to be made more targeted for full protection to the marginalized, poor and SC/ST.
·         Introduction of GST to be given thrust.
·         Setting up of Expenditure Management Commission to look into expenditure reforms.
·         Government to promote FDI selectively in sectors.
·         Requirement of the built up area and capital conditions for FDI to be reduced from 50,000 square meters to 20,000 square meters and from USD 10 million to USD 5 million respectively for development of smart cities.
·         Incentives for Real Estate Investment Trusts (REITS). Complete pass through for the purpose of taxation. A modified REITS type structure for infrastructure projects as the Infrastructure Investment Trusts (INVITS).These two instruments to attract long term finance from foreign and domestic sources including the NRIs.
·         More productive, asset creating and with linkages to agriculture and allied activities wage employment would to be provided under MGNREGA.
·         Initial sum of Rs 100 crore for “Start-up Village Entrepreneurship Programme” for encouraging rural youth to take up local entrepreneurship programs.
·         “Swachh Bharat Abhiyan” to cover every household with sanitation facility by the year 2019.
·         15 Model Rural Health Research Centres to be set up for research on local health issues concerning rural population.
·         Pan India programme “Digital India” to with an outlay of Rs500 crore to be launched.
·         Restructuring FCI, reducing transportation and distribution losses and efficacy of PDS to be taken up on priority.
·         Rs 100 crore provided for setting up a National Industrial Corridor Authority.
·         Central Government Departments and Ministries to integrate their services with the e-Biz -a single window IT platform- for services on priority by 31 December this year.
·         A sum of Rs 7060 crore is provided in the current fiscal for the project of developing “one hundred Smart Cities’.  Development of industrial corridors with emphasis on Smart Cities linked to transport connectivity to spur growth in manufacturing and urbanization will be accelerated.
·         Definition of MSME to be reviewed to provide for a higher capital ceiling.
·         Fund of Funds with a corpus of Rs 10,000 crore for providing equity through venture capital funds, quasi equity, soft loans and other risk capital specially to encourage new startups by youth to be set up.
·         Entrepreneur friendly legal bankruptcy framework will be developed for SMEs to enable easy exit.
·         A nationwide “District level Incubation and Accelerator Programme” to be taken up for incubation of new ideas and necessary support for accelerating entrepreneurship.
·         An institution to provide support to mainstreaming PPPPs called 4PIndia to be set up with a corpus of Rs500 crores.
·         A Green Energy Corridor Project is being implemented to facilitate evacuation of renewable energy across the country.
·         Changes, if necessary, in the MMDR Act, 1957 to be introduced to encourage investment in mining sector and promote sustainable mining practices.
·         Government in close consultation with the RBI to put in place a modern monetary policy framework.
·         Uniform tax treatment for pension fund and mutual fund linked retirement plan.
·         Banks to  be permitted  to  raise  long  term  funds  for  lending  to infrastructure  sector with minimum regulatory pre-emption such as CRR, SLR and Priority Sector Lending (PSL).
·         RBI to create a framework for licensing small banks and other differentiated banks. Differentiated banks serving niche interests, local area banks, payment banks etc. are contemplated to meet credit and remittance needs of small businesses, unorganized sector, low income households, farmers and migrant work force.
·         For venture capital in the MSME sector,  a Rs10,000 crore fund to act as  a catalyst to attract private Capital by way of providing equity , quasi equity, soft loans and other risk capital for start-up companies with suitable tax incentives to participating private funds to be established.
·         Rs 990 crore allocated for the socio economic development of the villages along the borders.
·         Rs2037 crores provided for Integrated Ganga Conservation Mission “NAMAMI GANGE”.NRI Fund for Ganga will be set up.
·         A “Young Leaders Programme” with an initial allocation of` 100 crore to be set up.
·         Legislative and administrative changes to sort out pending tax demands of more than Rs4 lakh crore under dispute and litigation.
·         Resident tax payers enabled to obtain on advance ruling in respect of their income-tax liability above a defined threshold.
·         Measures for strengthening the Authority for Advance Rulings.
·         Income-tax Settlement Commission scope to be enlarged.
·         Introduction of a “Roll Back” provision in the Advanced Pricing Agreement (APA) scheme so that an APA entered into for future transactions is also applicable to international transactions undertaken in previous four years in specified circumstances.
·         The scheme of Advance Ruling in indirect taxes to be expanded to cover resident private limited companies.  The scope of Settlement Commission to be enlarged to facilitate quick dispute resolution.

29 August 2014

Keep out will, whim and fancy

Since the commencement of the Constitution in 1950, it is for the third time that governors — this time, as many as nine — have had to go following a change of guard at the Centre. Congress and non-Congress governments have done the same thing every time the occasion has arisen. The situation is still developing, and the numbers may go beyond nine. Also, the issue of the removal of governors has been taken to court for the third time.
The office of governor has been mired in controversies — regarding appointment, functioning and removal — from Day One. From time to time, certain state governors have been accused of partisan behaviour and of acting as agents of the party or parties in power at the Centre. Some commentators have gone so far as to suggest doing away with the institution of the governor all together.
A dispassionate analysis of the need and role of the office would show that it is one of great dignity, responsibility and continuing relevance. On the one hand, a governor was envisaged as the constitutional head of the state, and on the other, as the representative of the Union in the state. She was expected to be a vital link between the Union and the state, to act as the eyes and ears of the Centre, and to generally ensure that the government of the state is carried out in accordance with the Constitution and, particularly, to see that the interests of the Union are safeguarded. In context of the many fissiparous tendencies that come to the fore now and then, the office of governor becomes even more relevant and important. Misuse of the high office by unscrupulous holders constitutes no argument for its abolition. If constitutional offices begin to be scrapped because some of their occupants indulge in unbecoming conduct, very soon hardly anything would be left.
Under Article 155 and 156 of the Constitution, a governor is appointed by the president and holds office during her pleasure. Thus, both appointment and continuance in office are dependent on the pleasure of the Union government. The Sarkaria Commission and the National Commission to Review the Working of the Constitution both suggested salutary reforms — including that governors should be selected only from among eminent persons not too intimately connected with active party politics. So long as this advice is not heeded, controversies because of their removal at the time of a change of government would continue.
In Surya Narain Choudhary vs Union of India, the Rajasthan High Court held that the pleasure of the president was not justiciable, the governor had no security of tenure and she could be removed by the president at any time by withdrawing her pleasure. In B.P. Singhal vs Union of India, the Supreme Court looked into the pleasuredoctrine in great depth. It upheld the earlier position — “no limitations or restrictions are placed on the ‘at pleasure’ doctrine, it means that the holder of the office can be removed by the authority at whose pleasure he holds office, at any time, without notice and without assigning any cause.” But the court said that it “does not dispense with the need for a cause for withdrawal of the pleasure”.
In other words, the occupant of office at pleasure can be removed “summarily, without any obligation to give any notice or hearing to the person removed, and without any obligation to assign any reasons or disclose any cause for the removal, or withdrawal of pleasure. [But] the withdrawal of pleasure cannot be at the sweet will, whim and fancy of the authority.” It should not be “mala fide”, “unreasonable” or done “arbitrarily, whimsically or capriciously”. “While the president need not disclose or inform the cause for his removal to the governor, it is imperative that a cause must exist.” As for judicial review, only where the aggrieved person is able to make a prima facie case of arbitrariness or mala fides, can the court require the Union government to produce records/ materials to show that the withdrawal of pleasure was for good and compelling reasons. The Supreme Court added that “there will be no interference unless a very strong case is made out” as the scope of “judicial review…is very limited”.
After this judgment of the Supreme Court, there should be no scope for any controversy or confusion. But controversy and confusion are often created to score political brownie points and to embarrass one’s opponent in power. Looked at from another angle, given that appointments are made only at the pleasure of the government, when an appointee has any indication of that pleasure having ended, she should consult her own dignity and self respect and put in her papers forthwith, without waiting to be asked to quit or to get removed. It is also clear that it is not for the president or prime minister to personally inform a governor of a government decision in the matter. After all, it is institutional.

Not in a fit state

India’s challenge over the next five years can be summed up somewhat melodramatically in one sentence: a medieval state is trying to run a post-modern economy. Almost every interesting story in recent days involved serious regulatory failure. These stories have belied any hope that cleaning up India’s regulatory mess is going to be easy. The right combination of technical skills, oversight mechanisms, public reason and mediation of knowledge systems is not going to be easy to institutionalise across a range of sectors.
If this diagnosis is correct, what India needs is not a new Planning Commission, not a new think tank, but a state-building commission. This is different from an administrative reforms commission, which looks at conventional issues of administration and process. A state-building commission has a different starting point. It would ask: how do we build a state fit for purpose?
Behind the recent economic logjam is not just a story of paralysis and corruption. It is also the story of a state that has not come to terms with new functions. The debilitating imbroglio over coal is not just about corruption; it also reflects an inability to understand what modern mining might look like. Disputes over electricity tariffs abound, with the recent Supreme Court stay on the compensatory tariff order for Tata-Adani being just the latest instance. Environment regulation is a general mess all around. There is no framework for thinking about the tradeoff between security and convenience even in as simple a thing as Uber. Apart from the knowledge issues, behind our inability to have a sane conversation on GM foods lies a well-founded suspicion of our regulatory capabilities. The list could go on: the police does not even have basic forensic capabilities to handle its case load; our newly commissioned warships are apparently taking to sea without submarine detection equipment. Corruption is part of the story in many of these cases. But the context in which the state operates has changed in several ways.
First, the knowledge mediation functions of the modern state are immeasurably more complex. It cannot avoid taking a call on scientific and technical knowledge, on every issue from regulating GM crops to assessing the environment, from health to the choice of energy technologies. How credible are its processes and capacities to take such calls, particularly in a context where the asymmetries in knowledge between what is produced in the state and what is produced outside it are growing immeasurably? What data does it require to have a minimum of social self-knowledge to intervene intelligently? Does it have the capacity to assess cross-cutting risks at the level of detail that matters? Our options are reduced because we do not trust the state to perform this role.will continue with many traditional functions, it is now more deeply implicated in markets, civil society, professional associations and so forth. Even internally, the state is a lot more heterogeneous and differentiated: it has to have capacity for command and control, regulation, contracting and so forth. The nature of laws that have to be drafted, the kinds of contracts that have to be overseen, the kinds of entities that have to be held accountable, the principal-agent problems that need to be surmounted, the networks that need to be managed, are vastly different. There is constantly sand in the wheels because few processes are attuned to these realities: the government is losing on poor drafting, poor contracting and poor project design. Traditional bureaucracy cannot do these functions.
Third, the human resource requirements of the new state are going to be very different. But nowhere in the Indian state is there a credible human resource strategy. What kind of people will the state need? Even when the state subcontracts out, it needs capacity to understand good subcontracting. With the possible exception of the Indian Economic Service, most of the knowledge-producing services of the state are in disarray. India’s pioneering statistical service is a pale shadow of itself. How does one select them, and what will it take to get them under altered market conditions? The department of personnel and training should be doing this. But it has no credible staffing roadmap for the state. No wonder the state is often out-lawyered, out-hacked and generally outwitted.
Fourth, a modern state ostensibly needs to supplement process with performance. There has been a lot of talk of performance accountability frameworks. But most of these are window-dressing. At the moment, the state does not do even one little routine exercise that should be mandatory. Many laws or significant policies usually have a financial assessment attached. But there is no administrative assessment attached to most laws or policies. Who will carry out the required functions? How much time and manpower will it take to carry them out? Policies cannot be drafted on the assumption that state capacity exists.
Fifth, a modern state, like all states, is located in an international context. But globalisation requires the state to have a thicket of interactions across a range of domains. Sometimes your strategic advantage is simply a function of the number of lawyers you can deploy in a negotiation. Unless you want to just say no, building up arsenals of negotiation is probably half the source of your power. Our arsenals of negotiation are much weaker than they should be.
Finally, the nature of rationality embodied in the culture of the state has changed. It could never be reduced to a purely technical exercise of economic maximisation or bureaucratic domination. This rationality has to take on board the undeniable importance of democratic experimentation and justification. It cannot be a top-down rationality constantly out of touch with organic processes and a changing society. It has to have cultures of communication that can engage with those
Second, while the statethat are going to be affected by policies. To borrow Jurgen Habermas’s phrase, it will have to engage in a form of communicative rationality if it is not to be constantly subverted.
Contrary to polemical readings, the Indian state is not hopeless. The first avatar of the Planning Commission coincided with a phase of state-building that was thought appropriate for the times. For all the rot in the bureaucracy and public sector, the fact remains that during the 1950s, India built some remarkable institutions that helped nation-building and democratic mediation. Getting rid of some old laws and deregulating more areas is easy. But the risk of being stuck with an ineffective state is still real. The big challenge is: How do we build a 21st century state?

Pradhan Mantri Jan Dhan Yojana: A step towards ‘Sab Ka Sath Sab Ka Vikas’

In his first Independence Day speech on 15th August’2014, Prime Minister of India had announced the National Mission on Financial Inclusion titled, ‘Pradhan Mantri Jan Dhan Yojana’(PMJDY). Now in less than a fortnight the country is geared up to launch this mega event all across the country with the Prime Minister himself launching it from the national capital.Simultaneous launch functions of the Yojana are held in the state Capitals and at all district Headquarters.  Besides, camps would also be organized in the area allotted to branches of the banks.  

Now what is this Yojana and how it’s going to be different from the earlier schemes…………
The PMJDY has been conceived as a national mission on financial inclusion with the objective of covering all households in the country with banking facilities and having a bank account for each household. Financial inclusion or inclusive financing is the delivery of financial services at affordable costs to sections of disadvantaged and low-income segments of societyin contrast to financial exclusion where those services are not available or affordable. It is said that since banking services are in the nature of public product, the availability of banking and payment services to the entire population without discrimination is the prime objective of financial inclusion in public policy. With a bank account, every household gains access to banking and credit facilities. This will enable them to come out of the grip of moneylenders, manage to keep away from financial crises caused by emergent needs, and most importantly, benefit from a range of financial products/benefits. Describing the task as “gigantic,” the Prime Minister in an email to all bank officers has stressed the need to enroll over 7 crore households and open their accounts on urgent basis as all their development activities are hindered by this single disability.

Current status of financial inclusion in the country:
Various initiatives were taken up by RBI / GoI in order to ensure financial inclusion. These include like Nationalization of Banks , Expansion of Banks branch network , Establishment & expansion of Cooperative and RRBs ,Introduction of PS lending , Lead Bank Scheme, Formation of SHGs and State specific approach for Govt sponsored schemes to be evolved by SLBC .During 2005-2006, RBI advised Banks to align their  polices with the objective of financial Inclusion.  Further, in order to ensure greater financial inclusion and increasing the outreach of the banking sector, it was decided to use the services of NGOs/SHGs, MFIs and other Civil Society Organizations as intermediaries in providing financial and banking services through use of “Business Facilitator and Business Correspondent Model”.

However, as per Census, 2011, out of 24.67 crore households in the country, 14.48 crore (58.7%) households had access to banking services. Of the 16.78 crore rural households, 9.14 crore (54.46%) were availing banking services. Of the 7.89 crore urban households, 5.34 crore (67.68%) households were availing banking services. In the year 2011, Banks covered 74,351 villages, with population more than 2,000 (as per 2001 census), with banking facilities under the “Swabhimaan” campaign through Business Correspondents .However the program had a very limited reach and impact.
 The present banking network of the country (as on 31.03.2014) comprises of a bank branch network of 1,15, 082 and an ATM network of 1,60,055. Of these, 43,962 branches (38.2%) and 23,334 ATMs (14.58%) are in rural areas. Moreover, there are more than 1.4 lakh Business Correspondents (BCs) of Public Sector Banks and Regional Rural Banks in the rural areas. BCs are representatives of bank to provide basic banking services i.e. opening of basic Bank accounts, Cash deposits , Cash withdrawals, transfer of funds, balance enquiries, mini statements etc. However actual field level experience suggests that many of these BCs are not actually functional.Public Sector Banks (PSBs) including RRBs have estimated that by 31.05.2014, out of the 13.14 crore rural households which were allocated to them  for coverage about 7.22 crore households have been covered (5.94 crore uncovered). It is estimated that 6 Crore households in rural and 1.5 Crore in urban area needs to be covered.

PMJDY
The mission mode objective of the PMJDY consists of 6 pillars. During the 1st year of implementation under Phase I (15th August, 2014-14th August,2015), three Pillars namely(1)Universal access to banking facilities (2) Financial Literacy Programme and (3) Providing Basic Banking Accounts with overdraft facility of Rs.5000 after six months and RuPay Debit card with inbuilt accident insurance cover of Rs 1 lakh and RuPay Kisan card, will be implemented.
Phase II, beginning from 15th August 2015 upto15th August,2018 will address (1) Creation of Credit  Guarantee Fund   for coverage of defaults in overdraft  A/Cs (2)  Micro Insurance and (3)  Unorganized sector Pension schemes like  Swavlamban. In addition, in this phase coverage of households in hilly, tribal and difficult areas would be carried out. Moreover, this phase would focus on coverage of remaining adults in the households and students.

  The implementation strategy of the plan is to utilize the existing banking infrastructure as well as expand the same to cover all households. While the existing banking network would be fully geared up to open bank accounts of the uncovered households in both rural and urban areas, the banking sector would also be expanding itself to set up an additional 50,000 Business correspondents (BCs), more than 7000 branches and more than 20000 new ATMs in the first phase .A comprehensive plan is necessary considering the past experience where a large number of accounts opened remained dormant, resulting in costs incurred for banks and no benefits to the beneficiaries. The plan, therefore, proposes to channel all Government benefits (from Centre/State/Local body) to the beneficiaries to such accounts and pushing the Direct Benefits Transfer (DBT) scheme of the Union Government including restarting the DBT in LPG scheme. MGNREGS sponsored by Ministry of Rural Development (MoRD, GoI) is also likely to be included in Direct Benefit Transfer scheme.
Keeping the stiff targets in mind, in the first phase, the plan would focus on first three pillars in the first year starting from 15th August, 2014.The target for setting up additional 50,000 BCs is quite challenging given the constraints of telecom connectivity.   In order to achieve this plan, phase wise and State wise targets for Banks have been set up for Banks for the period 15th August, 2014 to 14th August, 2015.    Roles of various stakeholders like other Departments of the Central Government, State Governments, RBI, NABARD, NPCI and others have been indicated. Gram Dak Sewaks in rural areas are proposed as Business Correspondent of Banks.  Department of Telecom has been requested to ensure that problems of poor and no connectivity are resolved. It is understood that of the 5.93 lakh inhabited villages in the country (2011 census) only about 50,000 villages are not covered with Telecom connectivity.

The major shift this time in this Financial Inclusion effort of the Government is that households are being targeted instead of villages as targeted earlier. Moreover both rural and urban areas are being covered this time as against only rural areas targeted earlier. The present plan pursues digital financial inclusion with special emphasis on monitoring by a Mission headed by the Finance Minister.

While the film on ‘Financial Inclusion’ and the Mission Document on Financial Inclusion scheduled for release at launch, are expected to help in creating awareness, the ‘account opening kit’ and the mobile banking facility on the basic mobile phone (USSD) envisaged on the occasion indicates the concerns of the government to end financial exclusion and usher in a new chapter in country’s governance for the people. In Prime Minister’s own words this Pradhan Mantri Jan Dhan Yojana lies at the core of this government’s development philosophy of Sab Ka Sath Sab Ka Vikas.

Radiation treatment of eye cancers using iodine-125


Generally, public believe that scientific and technological developments in the field of nuclear energy in India are mostly confined to the strategic area and to nuclear power generation. Medical, industrial and research uses of ionising radiation, which rose manifold over the past few decades have not got due recognition.

At any moment, hospitals in many parts of the country are carrying out radiation treatment in one form or other on many thousands of cancer patients.

BARC-made ‘BARC I-125 Ocu-Prosta seed’ is an ideal choice to treat retinoblastoma and uveal tract melanoma, two forms of rare eye cancers.

Unlike conventional treatment which involves removal of eyes with the tumour to save the patient, successful radiation treatment saves the eye and retains vision.

Since iodine -125 ( I-125) has a half life of about 60 days, scientists have enough time to transport the sources from its production site at BARC laboratories to the treatment centres at different parts of the country.

Half life is the period in which radioactivity of a source reduces to half its original value.

Modelling the eye

Specialists model the affected eye of each patient by using computerised tomography (CT) or magnetic resonance imaging (MRI) procedures. They identify the orientation of tumour borders relative to the surrounding healthy structures such as the optic nerve, centre of the eye etc by using ultrasound.

Using the imaging data in a dedicated software programme, they arrive at the number of radioactive seeds, their activity and their placement on the plaque to produce the ideal dose distribution.

Physicians use this information to fix appropriate number of I-125 seeds on a plaque of suitable size using a tissue compatible auto-polymerising glue.

By accurately positioning the plaque, they restrict irradiation to the tissue where it is needed.

I-125 which emits low energy gamma rays helps to spare healthy tissues; it reduces side effects and related morbidity. Generally, physicians carry out the treatment in 5 to 10 consecutive days.

BARC scientists have independently measured the dose distribution around I-125 seeds.

It was truly a multidisciplinary programme. Radiopharmaceuticals Division, Laser Processing and Advanced Welding Section, Centre for Design and Manufacture, Radio metallurgy Division, Radiological Physics and Advisory Division and external agencies such as Hindustan Machine Tools Limited, Bangalore and Titan Industries Limited, Hosur, collaborated in many areas to prepare the seeds.

Batch process

BARC scientists produce Iodine 125 in a batch process by irradiating 4 gramme of xenon-124 gas in the Dhruva reactor for a period of 15 days. Xenon -125 produced by the neutron interaction decays into I-125.

After removing from the reactor, they keep each sample for 50 days to ensure that I-126, an unwanted radioisotope which is also produced during neutron irradiation decays to negligible values.

“The need for technically intense operations in the handling of gaseous targets in hostile radiation environments, the transformation of I-125 into a chemical form within acceptable radionuclide impurities, and adherence to radioactive concentrations of the final I-125 solution are some of the key technical challenges during the production of I-125,” BARC scientists wrote in Industrial & Engineering Chemistry Research (2012, 51, 8575-8582), a journal of the American Chemical Society. This paper vividly describes the marvellous engineering and design procedures and production processes.

BARC-produced I-125 seeds are available in 50 micrometre thick titanium (titanium is bio-compatible) capsules of diameter 0.8mm and length 4.75 mm. Scientists subject these tiny seeds to a variety of tests mandated by the Atomic Energy Regulatory Board to ensure safety.

In September 2003, BARC supplied the first batch of I-125 seeds to Sankara Nethralaya to treat a four-year-old child suffering from retinoblastoma.

As on May 31, 2014, BARC supplied 1124 seeds to treat 95 patients from India and neighbouring countries. Sankara Nethralaya, Chennai, PD Hinduja National Hospital, Shri Ramakrishna Institute of Oncology Research/Arvind Eye Hospital, Coimbatore are collaborating in the programme

The patients treated so far are too few to estimate cure rates, eye salvation rates etc, though some preliminary results amply demonstrate the potential value of this treatment modality.

I-125 seeds are also useful in treating prostate cancer. BARC supplied so far 370 I-125 seeds to PD Hinduja Hospital, Mumbai to treat five patients. For treating prostate cancer, physicians implant I-125 seeds permanently in patients.

BARC's achievement

In spite of extensive demand for I-125 seeds worldwide, only a few companies produce I-125 seeds, as the manufacturing processes are too complicated. BARC has developed the technology from scratch. The Board of Radiation and Isotope Technology (BRIT) has plans to produce I-125 seeds commercially. It has great potential for internal use and hopefully for export.

PM launches Pradhan Mantri Jan Dhan Yojana

• End financial untouchability for freedom from poverty
• "Vish-chakra se gareebon ki aazadi ka parv" – celebration of liberation of the poor from a poisonous cycle

• A record unprecedented in economic history – 1.5 crore bank accounts opened in one day

The Prime Minister, Shri Narendra Modi, today declared the beginning of the end of financial untouchability in India, with the opening of an estimated 1.5 crore bank accounts across the country, in an exercise unprecedented in scale in economic history.

Formally launching the Pradhan Mantri Jan Dhan Yojana (PMJDY) at a function broadcast across the nation from Vigyan Bhawan in New Delhi, the Prime Minister described the occasion as a festival to celebrate the liberation of the poor from a poisonous cycle. (Vish-chakra se gareebon ki aazaadi ka parv)

Expressing satisfaction at a number of records being broken today, the Prime Minister said the nationwide success of the enrolment drive today would give confidence not just to the officials of the Department of Financial Services and banking sectors, but also to officers across the Union Government, that they can successfully achieve the goals that they set for themselves. "Never before would insurance companies have issued 1.5 crore accident insurance policies in a single day. Never before in economic history would 1.5 crore bank accounts have been opened in a single day. Never before has the Government of India organized a programme of such scale – over 77,000 locations – with the participation of so many Chief Ministers, Union Ministers, Government and bank officials." He said the success is an inspiration for achieving new heights.

The Prime Minister said that though the initial target of PMJDY was to open bank accounts for 7.5 crore families in one year, he had exhorted the concerned officials to complete the task before the next Republic Day.

Elaborating the benefits under PMJDY, the Prime Minister said this was not a mere bank account, but had other benefits including an RuPay debit card, Rs 1 lakh accident insurance cover, and an additional Rs. 30,000/- life insurance cover for those opening bank accounts before January 26th, 2015. He said the account performance would be monitored and overdraft facility would be given. The Prime Minister said he had sent 7.25 lakh bank employees, exhorting them to help reach the target of 7.5 crore bank accounts, and bring freedom from financial untouchability.

The Prime Minister referred to the five beneficiary couples who had received account opening kits in today`s event at Vigyan Bhawan, and said the ladies appeared to have dressed for a festival. He said they knew that there could be no bigger festival than the opening of a bank account for empowering women.

The Prime Minister said when banks were nationalized in 1969, it was done with the objective of bringing people into the economic mainstream. But that objective had not been achieved till date. After 68 years of independence, not even 68% of India`s population had access to banking, he added. He said it is easy for the rich to get a loan at low interest rates. But the poor are forced to seek loans from money-lenders at five times the rate charged to the rich. Is it not the responsibility of the banking industry to provide banking access to the poor, the Prime Minister asked.

The Prime Minister illustrated his point through the example of a mother saving money and being forced to hide it somewhere within the house. He said the bank officials who had opened an account for such a mother, had been blessed today.

He said a breakthrough was required to overcome the vicious cycle of poverty and debt, and that breakthrough had been achieved today. He said there were similarities between the poor getting access to mobile telephones, and getting access to debit cards. They both had the effect of instilling confidence and pride among the poor, he added.

The Prime Minister referred to the ancient Sanskrit verse: Sukhasya Moolam Dharma, Dharmasya Moolam Artha, Arthasya Moolam Rajyam – which puts the onus on the state to involve people in economic activity. "This Government has accepted this responsibility," the Prime Minister said.

The Prime Minister said Indians had a habit of saving, and thinking about the future of their children.

The Prime Minister also distributed awards to winners of the Name and Logo contest for this scheme. He observed that those who won prizes were predominantly from non-Hindi speaking states, but had won prizes for coining a name and slogan in Hindi. This is an example of national integration, he said.

Speaking on the occasion, the Finance Minister said PMJDY would be taken forward in Mission Mode, and the first target of reaching 7.5 crore unbanked families would be achieved by January 26th, 2015.

The Minister of State for Finance, Smt. Nirmala Sitharaman, said the lady of the house had been given priority in the PMJDY. She said this scheme would touch the lives of everyone in a positive and constructive way.




The Yojana will be implemented in two phases:- 

Phase-I from 15th August 2014:

·         Universal access to banking facilities for all households across the country through a bank branch or a fixed point Business Correspondent (BC) called Bank Mitra within a reasonable distance except areas with infrastructure & connectivity constraints.
·         To cover all households with atleast one Basic Banking Account with RuPay Debit card having inbuilt accident insurance cover of Rs.1 lakh. Further an overdraft facility upto Rs.5000 will also be permitted to Adhaar enabled accounts after satisfactory operation in the account for 6 months.
·         Financial literacy programme which aims to take financial literacy upto village level.
·         The Mission also envisages expansion of Direct Benefit Transfer under various Government Schemes through bank accounts of the beneficiaries of.
·         The issuance of Kisan Credit Card (KCC) as RuPay Kisan Card is also proposed to be covered under the plan.

Phase-II :

·         Providing micro –insurance to the people.
·         Unorganised sector Pension schemes like Swavalamban through the Business Correspondents.

The Yojana is being monitored in a Mission Mode with the Finance Minister being the Head of the Mission.

It is estimated to cover 7.50 crore households with at least one account under the Yojana and also a large number of dormant accounts would be activated

Electronic Transfer of subsidies under various schemes of Government would be enabled.

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