Accounting for three good year

Accounting for three good years

India now has a positive image and the NDA is delivering on its promise of clean, responsive governance

By glossing over the positives in the three-year rule of the National Democratic Alliance (NDA) government led by Prime Minister Narendra Modi, our political adversaries, especially the Congress party, are trying to project a false narrative.

When the NDA took over the reins from the Congress-led United Progressive Alliance in 2014, it had to overcome all-round despondency after scam-ridden UPA rule. Now, there is an all-round, positive image for India and the NDA leadership has delivered on its promise of clean, responsive and transparent governance.

A global ‘bright spot’

The economy which was almost in a shambles, is now estimated to grow at 7.5% this fiscal. India is being hailed as the “bright spot” by the International Monetary Fund and other international bodies amid global gloom.

The Prime Minister believes that development would be incomplete without the poor benefiting from economic growth. With his stress on “reform, perform and transform”, people feel that he is the biggest transformer.

The 7.5% growth projections for this fiscal clearly indicate that economic resilience is due to efficient management. Fiscal prudence has been the watchword of this government. The golden indicators of the economy show that fiscal deficit is under control; the current account deficit is down to 0.7% from 4% in 2014; inflation is at a low of 4% as against a high of 11% in 2014; foreign direct investment inflows have touched $62.3 billion, and India’s foreign exchange reserves have touched a new high of $379 billion for the week ended May 19.

The introduction of the landmark GST regime from July 1 is set to improve the economy further. Another important reform is the abolition of the Foreign Investment Promotion Board.

The Bankruptcy and Insolvency Code, which helps in the quick resolution of insolvency cases, is one of the government’s biggest reforms. As part of governance reforms, the share of States from the divisible pool of taxes has been increased to 42%.

The other big reform has been the enactment of Real Estate (Regulation and Development) Act, 2016.

On the foreign policy front, the Prime Minister’s pro-active engagement with world leaders has ensured widespread backing for India’s claim for UN Security Council membership.

The Prime Minister has made it clear that “Gaon, Garib, Kisan, Mazdoor, Mahila, Yuva” form the core of the NDA’s people-centric policies and schemes have been formulated for their uplift. Agriculture has been accorded highest priority and the goal is to eventually double the income of farmers.

Credit facility to agriculture has been increased to a whopping ₹10 lakh crore — this will go a long way in preventing farmers from falling prey to usurious money lenders.

Another major pro-farmer scheme has been the Pradhan Mantri Fasal Bima Yojana, which covers all food grains and all risks in the crop cycle. With an outlay of ₹50,000 crore, the Pradhan Mantri Krishi Sinchayee Yojana seeks to provide water to every field (Har Khet ko Pani) in five years. The highest ever expenditure of ₹51,902 crore was made in 2016-17 under the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA).

There is also the Blue Revolution to ensure economic prosperity for fishermen and nutritional security where integrated development and management of fisheries, with an outlay of ₹3,000 crore, has been envisaged for five years.

The NDA government had to rework tax agreements with some countries. The series of measures to unearth black money include constituting a Special Investigation Team to announcing the successful Income Declaration Scheme (IDS). With the Benami Transactions (Prohibition) Act, the government has blocked a key route to generate and hold black money.

Finally, the game-changing invalidation of ₹500 and ₹1,000 notes has dealt a major blow to the twin menaces of black money and corruption, which became all too pervasive during the UPA regime.

The entire amount of black money has come into the banking system through demonetisation and every rupee is being verified whether it is black or white. Post-demonetisation, 91 lakh people have been added to the income tax net. There has also been unprecedented growth in digital payments.

This government has ushered in an infectious sense of honesty, accountability and transparency in the bureaucracy. The biggest example of this is the transparent auctioning of coal blocks and spectrum. Auctioning of 82 blocks over the life of the lease period would net ₹3.94 lakh crore. Compare this with the astronomical loss of ₹1,86,000 crore in the coal blocks allocations, as the Comptroller and Auditor General computed it, under the UPA dispensation.

There has also been decisiveness in resolving the four-decade old One Rank One Pension for ex-servicemen and the long-pending Land Boundary Agreement with Bangladesh.

I move back to welfare for the needy. Under Jan Dhan Yojana, a record 28.52 crore bank accounts were opened. Another 13 crore people have availed social security cover at nominal rates under Jan Suraksha. Capital of ₹3.17 lakh crore as collateral-free loans has been provided to 7.45 crore small entrepreneurs under the Micro Units Development & Refinance Agency Ltd (MUDRA) scheme.

Other pro-poor initiatives include Atal Pension Yojana, Pradhan Mantri Suraksha Bima Yojana and Jan Suraksha Yojana benefiting 16 crore people.

After the Prime Minister’s appeal, about 1.2 people have surrendered their LPG subsidy, which is being given to the poor under Ujjwala Yojana.

As many as 224 schemes have been brought under the Direct Benefit Transfer platform and over ₹1.92 lakh crore transferred to 32 crore beneficiaries, resulting in a saving of ₹49,560 crore. Rural development, infrastructure and housing have been given a huge thrust through ‘Housing for All’; rural electrification (about 13,432 of 18,456 un-electrified villages have been electrified) and rural connectivity (1.20 lakh km of rural roads constructed in last three years) are others.

Several schemes to empower women have been successfully implemented which include Beti Bachao, Beti Padhao (BBBP), Sukanya Samriddhi Yojana (over one crore accounts opened), Maternity Benefit (Amendment) Act ( increasing maternity leave to 26 weeks) and Pradhan Mantri Surakshit Matritva Abhiyan (safe pregnancy). After BBBP, there has been a remarkable improvement in the child sex ratio in Haryana — 950 girls to 1,000 boys.

Another important reform-driven outcome has been the cancellation of 23 million fake ration cards following Aadhar-linked public distribution in the States. With the mass movement of Swachh Bharat, 40 million toilets have been built and 1,94,000 villages have become open defecation free.

The NDA Government can definitely look back with satisfaction on its three-year rule.

Why trade is integral to human advancement

The work of this year’s John Bates Clark Medal winner Dave Donaldson highlights the impact of economic integration on modern societies

With the introduction of a goods and services tax in July, India will be one step closer to a common market. Most economists agree on the benefits of economic integration but to understand the profound impact of such integration on modern societies, one can do no better than to turn to the work of a young Stanford University economist, Dave Donaldson.

Donaldson, who has been in the news for winning the prestigious John Bates Clark Medal this year, recently authored a fascinating research paper (bit.ly/2swMaYE) with his frequent collaborator Arnaud Costinot of the Massachusetts Institute of Technology on agricultural trade within the US which showed that gains from intra-country trade were roughly equal to gains from productivity growth.

Donaldson and Costinot collected data on crop markets for more than 2,000 US counties spanning more than 100 years between 1880 and 1997. The duo consider the price gaps between different places for the same crop as an implicit measure of transaction cost. If market integration did indeed work, these price gaps should decline. Costinot and Donaldson documented that this fall in price-wedges resulting from greater market integration has the same effect on total output as that arising from greater farm productivity.

It is because of such careful empirical work based on data running across many years that Donaldson has won the Clark medal this year. The Clark medal is the second most prestigious award in economics after the Nobel Prize, and is conferred every year on an outstanding American economist under 40. Twelve of the 39 economists who have won the medal have gone on to win the Nobel Prize in economics.

Donaldson’s most famous work, which was cited in the statement announcing the award, is on India, and it shows how creating the right infrastructure at the right time can remove barriers to trade by lowering transport costs, and thereby lead to greater prosperity (bit.ly/2o2pYrr). Mining archival data, Donaldson looked at the economic impact of the Indian rail network, built during the British Raj.

After spending a decade collecting and analysing the data for this project, Donaldson concluded that the railway network’s expansion led to a fall in trading costs, increased goods traffic, and that the economic benefits greatly exceeded the cost of construction.

For his work on the Indian railways alone, Donaldson is a worthy winner of the Clark medal. But there is a broader scholarship to Donaldson that deserves our attention. The central element of this scholarship appears to be an inquiry into the historical patterns of intra-country and inter-country trade ties. Pick any Donaldson paper and you will find a very important question answered using data collected from archival material, and careful use of econometric techniques.

The theory of trade rests on the foundations laid exactly 200 years ago by a 19th century British economist, David Ricardo. The theory of comparative advantage postulates that a country which is more productive in the output of all goods and services compared to others may still gain in trade because of “comparative advantage”. Consider a brilliant lawyer who also happens to be a very efficient typist and organizer. The lawyer has a choice: either she can do all her work on her own, or she can hire a secretary to allocate the secretarial part of her work to that person. The theory of comparative advantage says that both the lawyer and the secretary will be better off by this trade: the secretary will have a job, and the lawyer can focus on the more lawyerly aspects of her work in which she has a comparative advantage, and end up earning more.

This is the basic takeaway from the Ricardian model: everyone gains from trade. Although the theory seems pretty straightforward and intuitive, testing Ricardian theory has been a difficult task in a world with many countries and varieties of goods. Given the predictions of the theory, many countries will already have specialized completely in certain goods and stopped producing others altogether, therefore making it difficult to find out the differences in “relative productivity” of workers, the variable that lies at the heart of the Ricardian model.

Donaldson and Costinot tackle this problem in an innovative manner in a 2012 research paper (bit.ly/2rjbnrJ). They turn again to agriculture, a sector in which scientific advances have allowed scientists to compute how productive different regions can be given differences in water availability, soil conditions and so on. If the Ricardian model indeed explains patterns of specialization, we should expect to find actual production patterns following patterns of productivity predicted by agronomists. Using Food and Agricultural Organization data for 17 major farm crops and 55 major agricultural countries, the duo show that the Ricardian prediction indeed holds true.

In a more detailed study (bit.ly/2rj8Fmg) published in The Review of Economic Studies, Donaldson, Costinot, and Ivana Komunjer of the University of California, San Diego, show how it is possible to calculate relative productivity levels even in case of manufactured goods by developing an alternative measure of “revealed comparative advantage”. They then use this gauge to empirically establish that countries export those goods in which they have greater relative productivity levels. According to the study, “The removal of Ricardian comparative advantage at the industry level would only lead, on average, to a 5.3% decrease in the total gains from trade.”

In a 1961 paper, Swedish economist Staffan Linder propounded the idea that local demand for a product spurs international trade. Countries with greater domestic demand for certain goods are also the ones that ship these products to other countries. If two countries demand different kind of goods, each will specialize in the industry for which it has the larger home market. Further, each will be a net exporter of goods in which it specializes.

Testing the theory that local demand affects exports, just like testing the theory of comparative advantage, is difficult. Donaldson and his co-authors compiled information on countries’ demographic composition and used that as a predictor of diseases. Using this information, they determine the demand for drugs within countries. They find (bit.ly/2smdKJ0) those countries that had greater local demand for certain kind of drugs also exported more of those drugs, providing a neat empirical validation of Linder’s insights.

In many ways, Donaldson’s work harks back to an earlier era of economic historians led by Nobel Prize-winning economist Robert Fogel, who pioneered the use of quantitative methods in economic history.

Historians were of the opinion that railroads were the engine of economic growth in 19th century US until Fogel showed in his 1962 Journal of Economic History paper (bit.ly/2swNrPn) that rail expansion had limited impact on economic development in the US.

Donaldson of course arrives at the opposite conclusion for India but given that unlike in the US, alternative modes of transport such as roads or inland waterways were barely developed during the British Raj, his analysis sounds plausible. However, like Fogel, Donaldson’s work also challenges the mainstream historical narrative of the British Raj and its impact on the Indian economy.

Most nationalists were opposed to the British investments in railways in India as they felt it was a drain on national resources. This was in line with the dominant view among nationalists that British rule was a drain on the Indian economy, and had led to deindustrialization of the economy.

The birth of “economic nationalism”—or the idea that India needed to be free because foreigners had ruined its economy—gave a boost to India’s freedom struggle, but it proved detrimental to a dispassionate assessment of economic history, argued economic historian Tirthankar Roy in a 2015 Economic and Political Weekly article (bit.ly/2s19RLW).

The contributions of Marxist scholars such as Paul Baran and Samir Amin bolstered this view and led many influential leaders of the developing world to view openness with suspicion. The rich world became so by exploiting poor countries such as India, the Marxist scholars argued, and the narrative of drain and deindustrialization in India acquired even greater legitimacy.

Roy argued that deindustrialization was a myth, simply because factory production and employment had taken firm roots in British India by the early 20th century and grew at a rapid pace in the first half of the 20th century.

But with rare exceptions such as Mahadev Govind Ranade, most nationalist thinkers viewed both trade and railroads with great suspicion. Donaldson’s careful work shows that whatever be its political and military imperatives, investment in railways was a boon rather than a bane for India.

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In a 1975 research paper, economist John Hurd was the first one to explain how the railways helped integrate the food market in India. Hurd utilized data for average wheat and rice prices from 1861 to 1921 and showed that the coefficient of variation in prices was lower for districts that had railways vis-à-vis those that didn’t.

Donaldson, who collected archival data from 1861 to 1930 on agricultural prices, trade data for eight types of salt and information on the spread of the rail network, confirmed Hurd’s findings that the railways helped in integrating markets, lowering price fluctuations and raising income levels. He estimates that real incomes shot up by 16% on average, a staggering figure given that total increase in income during that period was only about 22%.

In another paper co-authored with Robin Burgess of the London School of Economics, Donaldson showed that “the arrival of railroads in Indian districts dramatically constrained the ability of rainfall shocks to cause famines in colonial India”. Donaldson and Burgess track districts from 1875 to 1919 and find that on an average, a district was more vulnerable to famine before the railways arrived.

Donaldson’s work warns us against relying on simple nationalistic narratives to look at the past. It also warns against relying too much on the currently fashionable discourse of economic nationalism, which portrays trade as an enemy of the people. At a time when trade and economic integration seem to be under increasing attack, Donaldson’s scholarship reminds us that despite its drawbacks, trade has played a vital role in the march of human civilization.

Sumit Mishra teaches economics at the Institute for Financial Management and Research, Sri City.

Economics Express looks at the world through the lens of economics.

Key readings

How Large Are the Gains from Economic Integration? Theory and Evidence from U.S. Agriculture, 1880-1997,Arnuad Costinot and Dave Donaldson, NBER 2016; Railroads of the Raj: Estimating the Impact of Transportation Infrastructure,Dave Donaldson, NBER 2010; Ricardo’s Theory of Comparative Advantage: Old Idea, New Evidence, Arnuad Costinot, and Dave Donaldson, American Economic Review: Papers and Proceedings 2012

ISRO’s GSAT-19, 11 satellites set to be game changers in communications

ISRO’s upcoming endeavours — the GSAT-19 and the GSAT-11 satellites — can revolutionise communications by empowering a digital India

 ISRO’s upcoming endeavours — the GSAT-19 and the GSAT-11 satellites — are potential game changers and can revolutionise communications by empowering a digital India and providing Internet services and streaming like never before.

ISRO is undertaking a mega experiment at India’s rocket port at Sriharikota where a spanking new monster rocket is all set to launch an altogether new class of communications satellite. Tapan Misra, director of the Space Applications Centre, Ahmedabad, where the GSAT-19 satellite has been designed, calls it “a game changer communications satellite for India”. If it succeeds, the single GSAT-19 satellite will be equivalent to having a constellation of 6-7 of the older variety of communication satellites in space. Today, out of a constellation of 41 in-orbit Indian satellites, 13 are communication satellites.

“A truly ‘made in India’ satellite that will empower a digital India that is in the making,” says Misra of GSAT-19. India’s heaviest rocket till date, the Geosynchronous Satellite Launch Vehicle Mark-III (GSLV Mk-III) that weighs equivalent to the weight of five fully-loaded Boeing Jumbo Jets or as much as 200 fully grown elephants is attracting all the attention!

This is India’s rocket of the future as it will undoubtedly be human rated to carry Indian astronauts likely to be named ‘gaganauts or vyomanauts’. Former ISRO chairman K. Kasturirangan, the man who conceived the GSLV Mk-III, confirms it will be India’s vehicle to ferry Indians into space. On this maiden mission, the GSAT-19 satellite this monster rocket will ferry is in a technological class that has no parallels in the country.

The satellite weighing 3,136kg is equal to the weight of a single elephant being lofted into space, but this novel satellite promises not to be a ‘white elephant in space’. As space experts say rockets are like taxis, it is the passenger who is more important and hence in this forthcoming launch even though all eyes are on the GSLV Mk-III, the real focus should be on the unique passenger which is as Misra emphasises “the country’s first satellite capable of providing Internet services using a space based platform”.

Internet services may not be unleashed immediately but what the country is putting together is a capability in place which is very important especially to connect places that are literally off the fibre optic Internet backbone. At over 3 tons, the GSAT-19 satellite will the heaviest satellite made and to be launched from India and is a voluminous animal. Misra says “by volume it is the most enormous satellite made by India”. The satellite is indeed a test bed for many new technologies. GSAT-19 is going to be powered for the first time with indigenously-made Lithium-ion batteries. These batteries have been made so that India’s self-reliance quotient can increase.

In addition, similar batteries can then be used to power electric vehicles like cars and buses. According to ISRO, the GSAT-19 “carries a Geostationary Radiation Spectrometer (GRASP) payload to monitor and study the nature of charged particles and the influence of space radiation on satellites and their electronic components”. An important experiment to understand how to make space- based components more radiation resistant.

ISRO says GSAT-19 also features certain advanced spacecraft technologies including “miniaturised heat pipe, fibre optic gyro, Micro Electro-Mechanical Systems (MEMS) accelerometer”. These are all important developments being tested so that they become mainstay systems on future missions. The most innovative development on GSAT-19 is that for the first time there will be no transponders on the satellite. In fact, the word ‘transponder’ will not be associated with this new bird in the sky, says Misra. Instead for the first time, ISRO is using a whole new way of beaming data down using multiple frequency beams and hence it is dubbed “a high through put satellite”.

Misra explains that earlier the entire country was lighted with a single beam that meant all users had to share the same band width, with the new suite of technologies on- board GSAT-19 it has eight beams so that data can be pumped down in much higher capacities. Almost 6-7 times more data can be beamed down. GSAT-19 is a fore-runner for the technologies that ISRO seeks to unleash on the country. In fact scientists at ISRO suggest that GSAT-19 is just a trailer, the real movie which is the GSAT-11 satellite will go up in a few months and that is a mighty communications platform.

The GSAT-11 weighs a whopping 5.8 tons and since India still does not possess a space truck big enough to send it in orbit hence it will be launched using the Ariane-5 rocket from Kourou in South America. Don’t get confused by the numbering, in ISRO’s space-time warp sometimes the younger brother can get married before the older brother hence GSAT-19 is lifting off before GSAT-11.

The GSAT-11 is a mega satellite whose panels are the biggest India has ever made at over 4 metre in height, in addition this giant bird will have effectively 32 beams streaming data like never before. “It is not a single satellite but like a constellation of many satellites all working from a single platform and in unison from the sky,” Misra says.Once this satellite hits the orbit satellite-based Internet streaming will become a total reality for India, he says.

In the ever-changing cyber security environment, India urgently needs an all new Internet backbone since New Delhi just can’t rely on optical fibres, copper based telephony and mobile cellular services as an alternative. Today satellite-based Internet services are a robust and secure form of communication. “For a vast country like India, satellite-based communication where voice, data and streaming video all combine on a single platform holds immense potential,” Misra says.

India is today muscling its way into the big boys club of space fairing. ISRO Chairman A.S. Kiran Kumar says it is a huge experiment with an all new vehicle and an all new satellite.

Highlights of initiatives under NITI Aayog

Highlights of initiatives under NITI Aayog

NITI Ayog, The National Institution for Transforming India, was formed via a resolution of the Union Cabinet on January 1, 2015. NITI Ayog has emerged as the premier policy ‘Think Tank’ of the Government of India fostering the spirit of cooperative federalism under the dynamic leadership of  Prime Minister Shri Narendra Modi. Ever since its inception the institution has taken a series of initiatives aimed at giving a push to the economy and transforming the lives of millions across the country.

Following are the highlights of the initiatives taken by NITI Ayog:

       I.            Vision Document, Strategy & Action Agenda beyond 12^th Five Year Plan: Replacing the Five Year Plans beyond 31^st March, 2017, NITI Aayog is in the process of preparing the 15-year vision document keeping in view the social goals set and/ or proposed for a period of 15 years; A 7-year strategy document spanning 2017-18 to 2023-24 to convert the longer-term vision into implementable policy and action as a part of a “National Development Agenda” is also being worked upon. The 3-year Action Agenda for 2017-18 to 2019-20, aligned to the predictability of financial resources during the 14^th Finance Commission Award period, has been completed and will be submitted before the Hon’ble PM on April 23^rd at the 3^rd Governing Council Meeting

    II.            Reforms in Agriculture:

a. Model Land Leasing Law

Taking note of increasing incidents of leasing in and out of land and suboptimal use of land with lesser number of cultivators, NITI Aayog has formulated a Model Agricultural Land Leasing Act, 2016 to both recognize the rights of the tenant and safeguard interest of landowners. A dedicated cell for land reforms was also set up in NITI. Based on the model act, Madhya Pradesh has enacted separate land leasing law and Uttar Pradesh and Uttarakhand have modified their land leasing laws. Some States, including Odisha, Andhra Pradesh and Telangana, are already at an advance stage of formulating legislations to enact their land leasing laws for agriculture.

b. Reforms of the Agricultural Produce Marketing Committee Act

NITI Aayog consulted with the States on 21 October 2016 on three critical reforms –

(i)                 Agricultural marketing reforms

(ii)               Felling and transit laws for tree produce grown at private land

(iii)             Agricultural land leasing

Subsequently, Model APMC Act version 2 prepared. States are being consulted to adopt APMC Act version 2.

c. Agricultural Marketing and Farmer Friendly Reforms Index

NITI Aayog has developed the first ever ‘Agriculture Marketing and Farmer Friendly Reforms Index’ to sensitise states about the need to undertake reforms in the three key areas of Agriculture Market Reforms, Land Lease Reforms and Forestry on Private Land (Felling and Transit of Trees). The index carries a score with a minimum value “0” implying no reforms and maximum value “100” implying complete reforms in the selected areas.

As per NITI Aayog’s index, Maharashtra ranks highest in implementation of various agricultural reforms. The State has implemented most of the marketing reforms and offers the best environment for undertaking agri-business among all the States and UTs.  Gujarat ranks second with a score of 71.50 out of 100, closely followed by Rajasthan and Madhya Pradesh. Almost two third States have not been able to reach even the halfway mark of reforms score, in the year 2016-17. The index aims to induce a healthy competition between States and percolate best practices in implementing farmer-friendly reforms.

 III.            Reforming Medical Education

A committee chaired by Vice Chairman, NITI Aayog recommended scrapping of the Medical Council of Indi and suggested a new body for regulating medical education. The draft legislation for the proposed National Medical Commission has been submitted to the Government for further necessary action.

 IV.            Digital Payments Movement:

a.       An action plan on advocacy, awareness and co-ordination of handholding efforts among general public, micro enterprises and other stakeholders was prepared. Appropriate literature in print and multimedia was prepared on the subject for widespread dissemination. Presentations/ interactions were organized by NITI Aayog for training and capacity building of various Ministries/Departments of Government of India, representatives of State/UTs, Trade and Industry Bodies as well as all other stakeholders.    

b.      NITI Aayog also constituted a Committee of Chief Ministers on Digital Payments on 30th November 2016 with Hon’ble Chief Minister of Andhra Pradesh, Chandrababu Naidu, as the Convener to promote transparency, financial inclusion and a healthy financial ecosystem nationwide.  The Committee submitted its interim report to Hon’ble Prime Minister in January 2017.

c.       To incentivize the States/UTs for promotion of digital transactions, Central assistance of Rs. 50 crore would be provided to the districts for undertaking Information, Education and Communication activities to bring 5 crore Jan Dhan accounts to digital platform.

d.      Cashback and referral bonus schemes were launched by Hon'ble Prime Minister on 14.4.2017 to promote the use of digital payments through the BHIM App. 

e.       Niti Aayog also launched two incentive schemes to to promote digital payments across all sections of society - the Lucky Grahak Yojana and the Digi Dhan Vyapar Yojana  –Over 16 lakh consumers and merchants have won Rs. 256 crore under these two schemes .

f.       Digi Dhan Melas were also held for 100 days in 100 cities, from December 25th to April 14th.  

    V.            Atal Innovation Mission: The Government has set up Atal Innovation Mission (AIM) in NITI Aayog with a view to strengthen the country’s innovation and entrepreneurship ecosystem by creating institutions and programs that spur innovation in schools, colleges, and entrepreneurs in general. In 2016-17, the following major schemes were rolled out:

a.       Atal Tinkering Labs (ATLs): To foster creativity and scientific temper in students, AIM is helping to establish 500 ATLs in schools across India, where students can design and make small prototypes to solve challenges they see around them, using rapid prototyping technologies that have emerged in recent years.

b.      Atal Incubation Centres (AICs): AIM will provide financial support of  Rs.10 crore and capacity buidling for setting AICs across India, which will help startups expand quicker and enable innovation-entrepreneurship, in core sectors such as manufacturing, transport, energy, education, agriculture, water and sanitation, etc.

 VI.            Indices Measuring States’ Performance in Health, Education and Water Management: As part of the Prime Minister’s Focus on outcomes, NITI has come out with indices to measure incremental annual outcomes in critical social sectors like health, education and water with a view to nudge the states into competing with each other for better outcomes, while at the same time sharing best practices & innovations to help each other - an example of competitive and cooperative federalism..

VII.            Sub-Group of Chief Ministers on Rationalization of Centrally Sponsored Schemes: Based on the recommendations of this Sub-Group, a Cabinet note was prepared by NITI Aayog which was approved by the Cabinet on 3^rd August, 2016. Among several key decision, the sub-group led to the rationalization of the existing CSSs into 28 umbrella schemes.

VIII.            Sub-Group of Chief Ministers on Swachh Bharat Abhiyan: Constituted by NITI Aayog on 9^th March, 2015, the Sub-Group has submitted its report to the Hon’ble Prime Minister in October, 2015 and most of its recommendations have been accepted.

 IX.            Sub-Group of Chief Ministers on Skill Development: Constituted on 9^th March, 2015, the report of the Sub-Group of Chief Ministers on Skill Development was presented before the Hon’ble Prime Minister on 31/12/2015. The recommendation and actionable points emerging from the Report were approved by the Hon’ble Prime Minister and are in implementation by the Ministry of Skill Development

    X.            Task Force on Elimination of Poverty in India: Constituted on 16^th March, 2015 under the Chairmanship of Dr. Arvind Panagariya, Vice Chairman, NITI Aayog, the report of the Task Force was finalized and submitted to Hon’ble Prime Minister on 11^th July, 2016. The report of the Task Force primarily focusses on issues of measurement of poverty and strategies to combat poverty. Regarding estimation of poverty, the report of the Task Force states that “a consensus in favour of either the Tendulkar or a higher poverty line did not emerge. Therefore, the Task Force has concluded that the matter be considered in greater depth by the country’s top experts on poverty before a final decision is made. Accordingly, it is recommended that an expert committee be set up to arrive at an informed decision on the level at which the poverty line should be set.” With respect to strategies to combat poverty, the Task Force has made recommendations on faster poverty reduction through employment intensive sustained rapid growth and effective implementation of anti-poverty programs.

 XI.            Task Force on Agriculture Development: The Task Force on Agricultural development was constituted on 16th March, 2015 under the Chairmanship of Dr. Arvind Panagariya, Vice Chairman, NITI Aayog. The Task Force based on its works prepared an occasional paper entitled “Raising Agricultural Productivity and Making Farming Remunerative for Farmers” focusing on 5 critical areas of Indian Agriculture. These are (i) Raising Productivity, (ii) Remunerative  Prices to Farmers, (iii) Land Leasing, Land Records  & Land Titles; (iv) Second Green Revolution-Focus on Eastern States; and (v) Responding to Farmers’ Distress. After taking inputs of all the States on occasional paper and through their reports, the Task Force submitted the final report to Prime Minister on 31st May, 2016. It has suggested  important policy measures to bring in reforms in agriculture for the welfare of the farmers as well as enhancing their income.

XII.            Transforming India Lecture Series:  As the government’s premier think-tank, NITI Aayog views knowledge building & transfer as the enabler of real transformation in States. To build knowledge systems for States and the Centre, NITI Aayog launched the ‘NITI Lectures: Transforming India’ series, with full support of the Prime Minister on 26^th August 2016. The lecture series is aimed at addressing the top policy making team of the Government of India, including members of the cabinet and several top layers of the bureaucracy. It aims is to bring cutting edge ideas in development policy to Indian policy makers and public, so as to promote the cause of transformation of India into a prosperous modern economy. The Hon’ble Deputy Prime Minister of Singapore, Shri Tharman Shanmugaratnam, delivered the first lecture on the topic: India and the Global Economy. On November 16^th, 2016, Bill Gates, Co-Founder, Bill and Melinda Gates Foundation, delivered the second lecture in the series under the theme: 'Technology and Transformation'.

Great achievement,congratulations for great career.Your politeness,sincerity,and hard work had resulted in such high rank (52)

Great achievement,congratulations for great career.Your politeness,sincerity,and hard work had resulted in such high rank (52)

Shame of debt, steep costs driving farmers to suicide: RBI-commissioned study

The RBI-commissioned study listed faulty crop choices and aspirational consumption patterns as other major factors leading farmers to commit suicide

The study observed that close to 270,000 farmers have committed suicide in the past 15 years.

Shame arising out of inability to repay loans taken from relatives and acquaintances is a key reason for farmers resorting to suicide, a study commissioned by the Reserve Bank of India (RBI) found.

The study titled “Lives in debt: narratives of agrarian distress and farmer suicides”, conducted by researchers at Shiv Nadar University and published in the latest issue of Economic and Political Weekly, listed faulty crop choices, rising input costs, and aspirational consumption patterns as other major factors driving suicides, following field investigations in two of the most suicide-prone districts in India—Yavatmal in Maharashtra and Sangrur in Punjab.

The findings come at a time when a farm debt waiver in Uttar Pradesh has sparked demand for similar relief in these two states. In Punjab, despite a record harvest, farmer suicides have continued.

Despite formal credit to farmers growing tenfold between 2001 and 2012, commercial banks have “deepened” credit instead of “widening” it, making loans more accessible to farmers with large landholdings, the study said, adding that “it (the surge in formal credit) was insufficient to rule out the predominance of non-institutional sources”.

Citing data from the National Crime Records Bureau, the study observed that close to 270,000 farmers have committed suicide in the past 15 years, and despite wide differences in cropping patterns and access to irrigation, the crisis in farming is strikingly similar in districts like Yavatmal (rain-fed cotton belt) and Sangrur (irrigated region growing three crops in a year).

In Yavatmal, the survey showed that small and marginal farmers (owning less than 2 hectares) who lacked non-farm sources of income were most likely to commit suicide.

“The shame associated with one’s inability to repay is immense in a village society and it is all the more acute if money is borrowed from relatives,” the study observed.

In Sangrur, the study found that most families where a farmer suicide took place had outstanding debts over Rs200,000. Many families were indebted to traders and commission agents and had exhausted all formal credit channels, the study found.

It further said that crop choices in these districts were not in tune with the agro-climatic features of the region. Cultivation of Bt cotton in Yavatmal where rainfall is unpredictable and growing rice in Sangrur where water tables are depleting has put farmers under considerable stress, according to the study.

The researchers observed that a Bt cotton farmer is barely able to meet the rising costs of cultivation, let alone generate a profit sufficient to sustain the household. In Punjab, a highly input-intensive farming and low support prices that did not keep pace with production costs have meant little surplus left with farmers to repay loans.

While consumption expenditure of small farmers usually exceeds their income from farming, the mismatch is higher in Punjab, the study said, adding the state tops in purchase of consumer durables often financed by loans form non-institutional sources.

Due to massive defaults caused by repeated crop failures, “the most frightening point emerging from the field study is the exhausting of informal sources of credit” leading to a situation where moneylenders prefer buying out assets of farmers than mortgaging them, the study said.

It suggested several interventions, including discouraging loans to crops not suited to the ecology of a region, restructuring of loans into smaller instalments, and introduction of cashless loan components to avoid diversion of loans towards consumption expenditure, as possible measures to curb suicides.

Criticising the pitifully low public expenditure on agriculture (less than 1% of the GDP), the study said “an economy driven by jobless growth, compulsive migration” (from rural India) creates new “serfs” in informal services and construction, “while existing rural and agrarian problems remain unresolved”.

Environment ministry panel defers clearance to 600 MW Tawang power project

Environment ministry’s forest panel defers clearance to the 600 MW Tawang hydroelectric project, noting that it could severely hit the biodiversity in the region

Representational image. The Arunachal Pradesh government had sought a diversion of 187.20 hectare of forest land for construction of the Tawang hydroelectric project stage-I (600 MW) on Tawang Chu River in Tawang district by the NHP

The expert forest panel of the environment ministry has deferred clearance to the 600 megawatt (MW) Tawang hydroelectric project in Arunachal Pradesh until a study is conducted on it, noting that the location is a vital wintering ground of the black necked crane, an endangered species, and other birds.

The decision came at a 16 May meeting of the Forest Advisory Committee (FAC) of the ministry of environment, forest and climate change (MoEFCC). 

The Arunachal Pradesh government had sought a diversion of 187.20 hectare of forest land for construction of the Tawang hydroelectric project stage-I (600 MW) on Tawang Chu River in Tawang district by the NHPC Ltd.

The project, whose estimated cost is about Rs4,824 crore, would also result in about 200,000 trees being felled. The trees include threatened plant species.

“FAC after thorough deliberation observed that BNHS (Bombay Natural History Society) had represented to the members of FAC that Tawang valley in Arunachal Pradesh is very high in biodiversity having several critically endangered species as well as several endemics. The particular location of the project is also vital wintering ground of Black Necked Crane,” noted the minutes of FAC’s meeting, which were reviewed by Mint.

Black Necked Crane, an endangered bird, is a protected bird under India’s the Wildlife Protection Act 1972. It is also counted as a ‘vulnerable’ species by the International Union for Conservation of Nature (IUCN), an international NGO working on environment and conservation issues. 

“These birds require quality wetlands. The proposed project (even if it is river run off project) has an ability to significantly alter the wetland characteristics thereby significantly affecting habitat of Black Necked Crane and in worst case scenario losing one of the finest wintering habitat of the species,” FAC held.

The expert committee also noted that the proposed area has been identified as an important birding area by BNHS.

“The view point of BNHS was taken into consideration and same was discussed with user agency. After detailed deliberation and discussion with user agency it is recommended that a study in this regards shall be conducted through Wildlife Institute Dehradun at the cost of user agency. The case shall be deferred till the study is conducted,” said FAC.

Not just birds, the area is also home to important animals like barking deer, sambar, wild yak, serow, goral, wild boar, red panda, clouded leopard, snow leopard and musk deer.

The project is among the 11 proposed hydropower projects totalling 2802.20 MW capacity in the ecologically sensitive Tawang River Basin (TRB) in Arunachal Pradesh. This particular project had first come to FAC in 2011 but has been pending since then for varied reasons.

Harnessing of hydro power potential has been on top of the central government’s agenda for nearly a decade now. The government wants to establish prior user rights on rivers that originate in China and fast-track overall development of north-east India.

As per official estimates, north-east India has a hydropower potential of about 65,000 MW and of that nearly 50,000 MW is in Arunachal Pradesh, which is claimed by China in almost its entirety.

But environmentalists have repeatedly opposed such large-scale projects, saying that they could severely hit the biodiversity-rich north-eastern region, resulting in irreversible environmental damage.

“Arunachal Pradesh is the richest biodiversity area in whole of India. But the destruction has already started and is getting faster now. Whatever little dissent people have expressed has been squashed,” said ornithologist Bikram Grewal. “They (government) are pushing everything in name of national security, defence and progress...Sadly it is anything but progress. If conservationists can stand their ground it will be a major achievement. But this seems difficult at the moment.