Indian economy and issues relating to planning, mobilization of resources

Indian economy and issues relating to planning, mobilization of resources for GS3
The state of Indian economy at the time of independence:
Though we got some economical advancement through the British rule, we were exploited soundly by them all the periods.
Some negative impacts:
1. decline of handicraft industry
2. importance to production of cash crops than food crops
3. famines and food shortage
4. rise of intermediaries in the agriculture
some positive impacts:
1. railways
2. jute mills, cotton mills
3. coal mine
4. telecommunication, post offices.
With the impact of the two hundred year British rule at the time of independence Indian economy was almost completely stagnant.

* 85% of people were living in villages

* 75% of the working population engaged in agriculture

* Even this large population engaged in agriculture the country was not self sufficient in food

* Illiteracy was as high as 84%

* Majority of the children age group(6-11) did not attend the schools

* Mass communicable diseases was rampant

* In the absence of good public health system mortality rate was high.
Thus, the economy was faced with the problem of mass poverty, ignorance and diseases, which were aggravated by the unequal distribution of resources between groups and regions.
Planning before independence:
1.National Planning Committee (NPC):
Chairman: Jawaharlal Nehru
Year:1938
Recommendations of the committee:

* The state should own or control all key industries and services, mineral resources, railways, waterways, shipping and other public utilities and all those large scale industries, which were likely to become monopolistic in character.

* Agriculture is crucial to draw up a scheme of national planning.

* The planning should aim at doubling the standard of living of the people in 10 years.
2. Gandhian plan:
Gandhian plan is concerned with the development of agricultural and small scale industries. A gandhian paln incorporating these policies were prepared by shriman narayan and acharya s.n. agarwal in 1944.
3.bombay plan:
In 1944 eight industrialists of Bombay prepared a plan of economic development of India which was popularly called as Bombay plan.
JRD tata, GD birla, purshothamdas thakurdas, lala shriram, kasthuribhai lalabhai, ad shroff, ardeshir dalal and john mathai were the 8 industrialists.
4.peoples plan:
This plan was formulated by m.n.roy. this plan gave great priority to agriculture.
All these plans were of historical importance as there was no opportunity to implement them. Therefore they remained on paper only. However, all these plans do indicate broad consensus about the importance of the role of state in the development process of the Indian economy.
Planning in post independent india:
0. sarvodaya plan:
This plan was formulated by jaiprakash narayan in 1950. This plan was inspired by gandhian plan as well as sarvodaya plan idea of vinoba bhave.
Along with agriculture it also emphasized small and cottage industries. It also stressed upon land reforms and decentralised participatory planning.

1.first five year plan:


* Plan period april 1 1951 to march 31 1956.

* Priority given to agriculture because of more import of food grains happend in that time.

* Target growth rate was 2.1 and achieved 3.6

* Success because of excellent increase in food production.

2.second five year plan:


* Plan period april 11956 to march 31 1961

* Priority given to industrialisation especially of heavy industries.

* Socialist pattern of Indian economy imitating USSR.

* Durgapur(UK), bhilai(USSR), and Rourkela (W.Germany) steel plants were setup.

* Chitaranjan locomotive factory, coal India limited, ONGC, shipping corporation of india, uranium corporation of inida limited setup.

* Because of large import there was a acute shortage of foreign exchange reserve.

* Targeted growth rate was 4.5 but achieved 4.1

* Moderately success.

3.third five year plan:


* Plan period april 1 1961 to march 31 1966.

* Self reliant and self generating economy was the goal.

* Priority to agriculture and development of basic industries.

* Targeted growth rate 5.6 but achieved 2.8

* Failure, because
i)india china war of 1962.
ii)indo pak war of 1965.
iii)famine in 1965-66.
iv)more borrowings from IMF.
Because of this failure various sectors demanded plan holiday. So three annual plans were arrange from 1966 onwards.
Three annual plans:

* Plan period 1966 to 1969.

* Government declared the devaluation on rupee.

* Government also opted for liberalisation to get some foreign aid, since there was no much increase in foreign aid government backed out from the liberalisation.

* in 1969, 14 banks were nationalised.

4.fourth five year plan:


* plan period april 1 1969 to march 31 1974.

* Objective was growth with stability and progressive achievement of self reliance. This also given importance to the weaker sections.

* First tow years of the plan was successful because of green revolution.

* Targeted growth rate 5.7% but achieved only 3.3%

* Failure.
i)indo-pak war, liberation of Bangladesh.
ii)more refugee movement from Bangladesh.
iii)1972 oil crisis
iv)successive failures of monsoon.


5.fifth five year plan:

* Plan period april 1 1974 to march 31 1979.

* Removal of poverty and self reliance.

* It terminated before one year because of the change in govt.
Rolling plan:

* Plan period 1978 to 1980.

* Rolling plan means every year the performance of the plan will be assessed and a new plan will be made next year based on the assessment of the previous year.

* The focus of the plan was enlargement of the employment potential in agriculture and allied activities to raise the income of the lowest classes through minimum needs programme.
6. sixty five year plan:

* Plan period april 1 1980 to march 31 1985.

* Employment, food grains production direct attack on poverty.

* Development schemes such as integrated rural development programme(IRDP), national rural employment programme(NREP), rural landless employment guarantee programme(RLEGP)etc.

* Targeted growth 5.2% and achieved growth 5.7%
7.seventh five year plan:

* Plan period april 1 1985 to march 31 1990.

* Energy, employment, food grain production and raising productivity.

* It also envisaged the continuance and expansion of the national rural employment programme(NREP), rural landless employment guarantee programme(RLEGP) which were started in the 6th five year plan.

Hindu rate of growth:
The hindu rate of growth is a derogatory term referring to the low annual growth rate of the socialist economy of india before 1991, which stagnated around 3.5% from 1950s to 1980s.
Annual plans 1990-1992:
In 1991 india in the at most financial crisis. This is because of the widening of current account deficit, more external borrowings finally at 1991 foreign exchange reserve in india reduced a historical low. So the government in that time under financial minister Dr. manmohan singh made so many reforms under the name of liberalization. Through this india escaped from a great financial crisis.
Rupee was once again devaluated in 1991.
Because of this politico-economic turmoil eighth plan delayed, in between 2 annual plans were launched. In that annual plans infrastructure was give importance.
8.eighth five year plan:

* Plan period april 1992 to march 31 1997.

* Modernization of industry, alleviation of poverty and unemployment.

* Many flagship programmes were started.

* The value of rupee was further devaluated.

* Industries were delicensed.

* Import tariffs were lowered and import restrictions were dismantled.

* Indian economy was opened for foreign investment.

* Highest economic growth rate of 6.8% achieved as against the targeted 5.6%
9.nineth five year plan:

* Plan period april 1 1997 to march 31 2002.

* Objective was growth with social justice and equality.

* It emphasized on basic amenities such as safe drinking water, universalisation of primary education, streamlining the PDS etc...

* Ensure food and nutritional security

* Empowerment of women, SC,ST,OBCs.

* Global economic slowdown and other factors led to the revision of targeted growth rate from 7% to 6.5% that is also not achieved.
10.tenth five year plan:

* Plan period april1 2002 to march 31 2007.

* Aimed to achieve 8% GDP growth.

* Also aimed to increase domestic saving.

* GDP was increased to 7.6%

* Domestic saving was also increased.

* But agriculture affected worstly.
11. eleventh five year plan:

* Plan period 2007 to 2012.

* Faster and more inclusive growth.

* Rapid growth with poverty reduction and creation of employment.

* Access to essential services in health and education especially for poors.

* Empowerment through education and skill development.

* Environmental sustainability.

* Reduction in gender equality.etc...
12. twelfth five year plan:

* 2012 to 2017.

* Faster, sustainable and more inclusive growth.
Achievements and failures of the planning in india:
While reviewing the performance of planning in india from 1950. A stagnant and dependent economy has been modernised and became self reliant.
Achievements:
1.indicators of economic progress:

* GDP increased.

* The process of industrialisation is massive. The country is self sufficient in consumer goods and basic commodities like steel, cement, etc. the other industries like fertilizers, telecommunication also expanding rapidly.

* Index of industrial production also increased. Production of finished steel, cement, coal, electricity generation, etc. increased.

* The availability of food grains have increased. so per capita cereal consumption increased.

* The development of economic infrastructure, energy, transport, and irrigation made industrialisation, urbanisation everything feasible.
2.indicators of social progress:

* Life expectancy of the people increased.

* India is having the largest pool of trained man power with high educational qualification.
Failures:

* Failure to provide a basic minimum level of living to the whole population.

* Failure to reduce inequalities of income and wealth.

* Failure to provide productive employment to all able bodied persons.

* Inadequate infrastructure availability.

* Neglect of small and marginal farmers and redistribution of land.

* The relative neglect of regionally balanced agriculture sector has been another major failure of the planning process in india. The average land productivity in china for example, is four times that of india. This is due to the policy of encouraging agriculture in selected regions of the country only and leaving rest of the country side dependent on rains for irrigation.
Changing perspective of planning in india:
What is centralised planning or planning by direction:
This type of planning is practised in socialist countries like china, former USSR, cuba, north korea, etc. under this kind of planning, there is one central authority which plans, directs and orders the execution of the plan in accordance with the pre determined targets and priorities. It determines the production figures, delivery schedules, quotas regarding the production of the goods, price controls, use of foreign exchanges and allocation of resources like labour, etc. amongst different competing users.
Disadvantages:

1. This kind of planning is undemocratic since the people are ignored all along.

2. It is bureaucratic and totalitarian. Corruption, red tapism, VIP system, tyranny are by product of bureaucracy.

3. There is shortage of some goods and as well as surplus of other goods. That is there is an imbalance in production output.

4. This is inflexible because once the plan is prepared, it is highly complex to alter in the later phase of planning. A part of plan cannot be changed without simultaneous changes in many interconnected activities.


1. It also leads to excessive standardisation. In other words under planning by direction the goods produced are standardised and lacking variety. As in the case of USSR, the produced TV, fridge or automobiles are identical having no differentiation.


1. It also involves huge administrative cost, as the planning by direction involves in elaborate census.

Advantages:

1. Public welfare given importance than profit.

2. There is no dispute between the entrepreneurs and the government regarding tax rates, investment policies, interest rates etc. as in the case of decentralised planning.

3. Here the problems of industrial disputes are very less, because disharmony between the labour and producer is less.

What is decentralised planning or indicative planning or planning by inducement:
Decentralised planning is connected with the capitalistic economies. The decentralised planning is implemented through market mechanism. In this type the market is manipulated through incentives and inducements. Here the producers are free to produce whatsoever they wish and consumers are free to consume whatsoever they wish. But such freedom of production and consumption are subject to certain controls and regulations. The consumers, producers, and other factors of production are induced with the help of various fiscal and monetary devices. Fro example if the planning authority wishes to boost the production of sugar in india it will provide subsides, tax holidays and loans to the firms involved in production of sugar.
The advantage and disadvantage of decentralised or indicative planning is more or less inverse of the advantage and disadvantages of the centralised or planning by direction.
Now i think we are clear about the above said planning types.
The central discussion of planning in india has been not whether there shall be planning but what form of planning it shall take, and in particular the state operate through the centralised planning(planning by direction) OR decentralised planning(indicative planning)(market mechanism). Suppose for example, the government decides that, to promote industrial growth in a sustained manner, the production decision need to be regulated. Now state could do this in various ways.
For example,

1. It could decide to set up government corporations, call public sector enterprises to directly control the production decisions.(centralised planning)

2. It could regulate production by making laws which ensure that anyone wanting to produce any industrial products has to take a license from government.(license raj, centralised planning)

3. It could also use the fiscal, monetary and tax policies to encourage or discourage the production of various industry groups by adopting appropriate policies.(decentralised planning)
In the Indian context the state used first two options more often than the last one. The system of industrial licensing and large scale investment in publicly owned industries created a strong industrial base for the Indian economy. But around mid sixties there is a problem in industrial growth and in the 1965-80 period there is a industrial slow down mainly because of the disadvantages no. 2 and 4 mentioned in the centralised planning.
So in the eighties and nineties planners started loosening the grip of direct approach and started stressing more on the fiscal and the monetary planning to achieve plan targets.
Agriculture sector , on the other hand is an example of indicative planning. The state used pricing policy, credit policy and institutional mechanisms to promote agricultural growth and achieved the plan targets quiet successfully.
Since the late seventies the planning process has been undergoing drastic changes world over due mainly to the above mentioned conditions. This is further reinforced by thecollapsing centrally planned economies of former USSR and the east European economies on the one hand and the spectacular performance of the east and south east asian economies on the other which stressed on planning by manipulating the market.
India also , since 1991 july there is a move in the same direction. The role of state in the economy is being reformulated and the private sector is being given more and more freedom to operate in almost all areas of economic activity. The industrial licensing is also almost given up. The list of sectors reserved exclusively for the public sector has been substantially purned. The state is withdrawing from many sectors of the economy where it had no business to be there in the first place. The only problem seems to be that it is also withdrawing from those activities like primary education, basic health etc. which require strong state intervention. This is a disturbing trend being observed of late in india.
Planning commission: (chapter 44 laxmikanth)
Planning commission was established in march 1950 by an executive resolution of the government of india, on the recommendation of the advisory planning board constituted in 1946, under the chairmanship of K C Neogi. Thus, the planning commission is neither a constitutional body nor a statutory body. In other words it is a non-constitutional or extra-constitutional body. In india, it is the supreme organ of planning for social and economic development.
Functions:

1. To make an assessment of material, capital, human resources of the country and investigate the possibilities of augmenting them.

2. To formulate a plan for the most effective and balanced utilisation of the countrys resources.

3. To determine priorities and to define stages in which the plan should be carried out.

4. To indicate the factors that retard economic development.

5. To determine the nature of the machinery required for successful implementation of the plan in each stage.

6. To appraise (assess the value or quality), from time to time, the progress achieved in execution of the plan and to recommend necessary adjustments.

7. To make appropriate recommendations for facilitating the discharge of its duties, or on a matter referred to it for advice by central or state government.
It should be noted that the planning commission is only a staff agency- an advisory body and has no executive responsibility. It is not responsible for taking and implementing decisions. This responsibility rests with the central and state governments.
Composition:

1. The prime minister of india has been the chairman of the commission. He presides over the meetings of the commission.

2. The commission has a deputy chairman. He is the de-facto executive head(i.e. full time functional head) of the commission. He is responsible for the formulation and submission of the draft five-year plan to the central cabinet. He is appointed by the central cabinet for a fixed tenure and enjoys the rank of a cabinet minister. Though he is not a member of cabinet, he is invited to attend all its meeting(without a right to vote).

3. Some central ministers are appointed as a part-time members of the commission. In any case, the finance minister and planning minister are the ex-officio(by virtue of) the member of the commission.

4. The commission has four to seven full time expert members. They enjoy the rank of a minister of state.

5. The commission has member-secretary. He is usually a senior member of IAS.
The state governments are not represented in the commission in any way. Thus, the planning commission is wholly a centre-constituted body.
Programme Evaluation Organisation: (PEO)
It was established in October 1952, as an independent organisation, under the general guidance and direction of the planning commission.
Objectives and functions of PEO:

1. It undertakes evaluation of selected programmes or schemes under implementation, as per the requirement of various divisions of planning commission and ministries or departments of government of india.

2. The PEO assess the performance, process of implementation, effectiveness of the delivery system, and impact of the programmes.

3. It also evaluates success and failures of the programmes in all the stages. And deriving lessons form that for the future improvement in the formulation and the implementation of the new programmes.

4. PEO is conducting external evaluation, independent of the administrative channels, through direct observations sample surveys and using social science research methods.
Organisational structure of PEO:
PEO is primarily a field level organisation under the overall charge of deputy chairman, planning commission.
It has a three tier structure.

1. At the apex level its head quarters at delhi.

2. The middle link of the PEO represents 7 regional evaluation officers. They are located at Chandigarh, Jaipur, lucknow, Kolkata, Mumbai, Hyderabad, Chennai.

3. The field units, known as project evaluation offices constitute the third tier. These are located in the capital cities of eight major states of the country.
National development council: (laxmikanth chapter 45)
The national development council was established in august 1952 by an executive resolution of the government of india on the recommendation of the first five year plan(draft outline). Like the planning commission, it is neither a constitutional body nor a statutory body.
Composition:
The NDC is composed of

1. Prime minister of india(as its chairman).

2. All union cabinet ministers.

3. Chief ministers of all states

4. Chief ministers/administrators of all union territories.

5. Members of the planning commission.
The secretary of planning commission acts as the secretary of the NDC. It is also provide with administrative and other assistance for its work by the planning commission.
Objectives:

1. To secure cooperation of states in the execution of the plan.

2. To strengthen and mobilise the efforts and resources of the nation in support of the plan.

3. To promote common economic policies in all vital spheres.

4. To ensure balanced and rapid development of all parts of the country.
Functions:

1. To prescribe guidelines for preparation of the national plan.

2. To consider the national plan as prepared by the planning commission.

3. To make an assessment of the resources that are, required for implementing the plan and to suggest measures for augmenting them.

4. To consider important questions of social and economic policy affecting national development.

5. To review the working of the national plan from time to time.

6. To recommend measures for achievement of the aims and targets set out in the national plan.
The draft five-year plan prepared by the planning commission is first submitted to the union cabinet. After its approval, it is placed before the NDC, for its acceptance. Then, the plan is presented to the parliament. With its approval, it emerges as the official plan and published in the official gazette.
Therefore, the NDC is the highest body, below the parliament, responsible for policy matters with regard to planning for social and economic development. However, it is listed as an advisory body to the planning commission and its recommendations are not binding. It makes its recommendations to the central and state governments and should meet at least twice every year.
Union-state relations on planning:
The constitution of India makes provision for a division of powers between the centre and the states. The seventh schedule of the Indian constitution contains three lists union, state, concurrent lists.
Among this three the concurrent list includes social and economic planning which means that it is a concern of both the state and union government.
Though state lists are reserved for the state governments, why the union government making plans on them:
The subjects like public health, education, roads, agriculture, animal husbandry, irrigation, land policy, forests, fisheries, etc. are found in the state list, these all are very important for making plan for the overall development of the country.
For example defence is in union list, for recruiting personnel in defence, health and education is important, but these are in state list. If the basic health and education is not given properly to the people, they cannot work properly in the defence sector. Like this so many examples are available, so a comprehensive national plan is necessary for the overall development of the country.
So, national planning widens the role of central government and tends to reduce the distinction between central and state responsibilities. The reason is,

* Planning determines the directions in which the central as well as state resources are to be used.

* In joining the states to prepare national plan the centre accepts some obligation for its implementation.

* The centre inspires the states with new ideas and impulses for national development programmes such as grow more food campaign, the national malaria control programme, welfare of backward classes, etc.
Dual administrative machinery:
This national planning led to the dual administrative machinery in the country.
For instance,
The centre has established a centre tractor organisation for land reclamation and development, while the states have such organisations of their own. Similarly for the execution of the community development programme, is not found in any list but subjects covered by it are found in the state list. This programme is administered by the community projects administration under the ministry of community development of the government of india. This policy decisions are taken by the central government and the same are implemented by the states through their own machinery.
Thus in an exclusively state sphere of activity, the union government has effectively stepped in as a partner and that too a senior partner not by invoking any extraordinary clause of the constitution but through the normal process of administration.
The same is true of implementation of the plan policies with regard to land reforms, development of forests, programmes relating to village industries and development of irrigation and power.
The idea behind this is that, although the primary responsibility in such matters may lie with the states, the centre has also an over-all responsibility for helping, co-ordinating and giving the states so that national polices can be evolved and satisfactorily worked out.

Mobilisation of resources:
India has been provided with a lot of natural and human resources.
Let us see one by one.
Land resources:

* Land resources have a definite limit.

* Demand for land resources has been increasing.

* Shifting of land use pattern happening. Mainly agricultural to non agricultural land use
Land utilisation in India (area wise descending order):

1. Net sown area.

2. Forest land under good tree cover.

3. Forest land under poor tree cover.

4. Area under non-agricultural uses.

5. Barren and uncultivable land.

6. Cultivable waste land.

7. Current fallows.

8. Permanent pastures and grazing ground.

9. Old fallow.

10. Miscellaneous tree crops and groves.
Agricultural land:
It includes net sown area, current fallows and land under miscellaneous tree crops and groves. Total agricultural land in india is more than 50% of the total geographical area. Though we provided with enormous land resources, because of the large population per capita availability is not high.
Non-agricultural land:
This includes land under forest, permanent pastures, other non-agricultural uses(towns, villages, roads, railways, etc.) and land classified as cultivable waste as well as barren and uncultivable land of mountain and desert areas.
Mobilisation of agricultural land:
Demand for land in non-agricultural uses is constantly increasing. So, further increase in the net sown area may not be an easy task.
So, we could do

1. Reclamation of waste and fallow land. This means making the waste and fallow land as cultivable land.

2. A significant increase in the area sown more than once. This means raising crops more than one time in the same land in the same year.
So, it is imperative that to give attention towards the improvement in agricultural technology. So that it should be possible to raise three to four crops a year.
Mobilisation of non-agricultural land:

* In locating sites for the development of urban centres, the need for housing, water supply, disposal of wastage and garbage, etc. should be taken into consideration.

* Hill areas as far as possible should be put under forest cover. Because forest is also a good resource as we know. It also controls flood, erosion etc.

* Extreme care should be taken in selecting sites for development of industries.
Soil resources:
Cropping pattern of the country is greatly influenced by the soils. The Indian council of agricultural research(ICAR) divides soil found in india into 8 major groups.

1. Alluvial soil including coastal and deltaic alluvial.

2. Black soil of varying type.

3. Red soil including red loam.

4. Laterite & latering soil.

5. Forest soil.

6. Arid and desert soil.

7. Saline and alkaline soil.

8. Peaty and organic soil.
Keeping in view their extent and agricultural use, first four soils form the most important soil groups in the country.
To mobilise the soil resources properly, two things need to be taken care of.

1. Minimising soil erosion.

2. Restore productivity of the soil.
For following this some ways of maintenance should be taken.

1. Rotation of crops helps to remove the deficiency of nutrients.

2. The roots and off shoots of the crops and their remaining are left in the field for a certain period of time to protect the soil from erosion.

3. Excessive irrigation causes salinity. This can he controlled by, first of all, sealing off all points of leaking from canals, reservoirs, tanks, and ponds and use of only the required amount of water. Salinity can also be removed by application of gypsum, phospogypsum, pyrites in addition to organic manures and fertilizers.
Water resources:
Water is also one of the most important sources of energy in the Indian economy. About 25% of the electricity generated in the economy is from the hydro resources. The other important use of water is in irrigation.
India possesses large reservoirs of water, but these are inadequate as compared to their requirements. So it becomes a matter of great national importance that the available resources are should be conserved and utilised judiciously economically.
For that,

* Water of the right quantity is available for all kind of uses.

* There is no misuse or wastage of this precious resource.
Water resources can be mobilised sustainably by following the following methods:

1. Recharging the reserves of groundwater.(rain water harvesting)

2. Diverting supply from an area of surplus to the region of scarcity.(inter linking of rivers)

3. Desalination of sea water.
The method of desalination using solar energy is being used in our country at places like bhavanagar in gujarath and churu in rajasthan.
Why National water policy water policy came:

1. Large parts of india have already become water stressed.

2. Issues related to water governance have not been addressed adequately

3. Low consciousness about the overall scarcity and economic value of water results in its wastage and inefficient use.

4. Pollution of water resources.

5. Inter-regional, inter-state, intra-state disputes in sharing of water, etc.
Recommendations of the draft national water policy 2012:

1. Adaptation to climate change.

2. Enhancing water available for use.

3. Demand management and water use efficiency.

4. Water pricing.

5. Conservation of river corridors, water bodies and infrastructure.

6. Water supply and sanitation.

7. Management of flood and droughts.

8. Research and training needs, etc.
Forest resources:
We all are aware of the demands for the forest resources and also about the importance of conserving our forest resources.
The area under forests in india is low not only as compared to the forest area in countries like japan(67%), Sweden(68%), Canada(49%), brazil(65%), and USA(32%) but it also much less than the norm of 33% of the total reporting area recommended in the national forest policy of 1952. The per capita forest land in india is 0.08 hectares as against the world average of 2.08 hectares.
A variety of major and minor products are obtained from forests.
Major products:

1. Industrial wood.

2. Fuel wood.
Minor products:
All other products obtained from forests other than wood.
Bamboos, canes, tenduleaves, grasses, essential oils, medicinal plants, lac, resins, gums, tanning materials, dyes, animal products, et.
For sustainable mobilisation of forest resources we could follow the following steps:

* Find alternative fuels.

* Find alternative raw materials to manufacture paper, sports goods, packing cases, furniture and beams used in buildings.

* The other way is to cultivate quick growing trees and herbages in large numbers in selected farms of degraded of wasteland.
For stopping deforestation some necessary steps have to be taken.

* Adoption of a scientific method of harvesting forest stocks.

* Developing a mechanism of monitoring forest growth rate and depletion.

* Establish an effective system of fighting forest fires.

* Strictly enforcing laws to deal with unauthorised cutting of trees.
And also we can increase the forest resources by the methods of

1. Tree plantation.

2. Social forestry.
Tree plantation:
Plantation on a mass scale of fast growing trees such as poplar, casuarinas, etc. should be undertaken. The productivity of tree plantation is found to be greater than that of natural forests.
Social forestry:
It is the forestry by the people and for the people within the limits of their villages, along foot paths, road sides, railways track sides, boundaries of fields and empty spaces, etc. the aim of social forestry is to meet the needs of fuel, fodder, fruits, timber and other local requirements of the local peoples.
Why national forest policy, 1952 came:
The policy was formulated on the basis of six paramount needs of the country.

1. For establishment of tree lands wherever possible

2. For evolving a system of balanced and complementary land use.

3. Need for ensuring progressively increasing supplies of grazing fields, small woods for agricultural implements and in particular firewood to release cattle dung for manure.

4. For checking the denudation of mountain regions, the erosion of space along the treeless banks of the great rivers leading to raving formation and the invasion of sea and coastal tracts.

5. Need for sustained supply of timber and other forest produce required for defence, communication and industry.

6. Need for the realisation of the maximum annual revenue in perpetuity consistent with the fulfilment of the other needs enumerated above.
New forest policy, 1988:
The new forest policy gave importance on two matters.

* Firstly, the policy lays emphasis on the conservation of forests and meeting the requirements of the tribal and rural people. This policy gave due attention to social forestry.

* Secondly, took the issue of demand for industrial materials. Realising the fact the uncontrolled expansion of forest-based industries would adversely affect the conservation objective, the policy has made

* No forest-based industry, except in the small scale and cottage sectors, would be permitted unless sustained availability of raw material was ensured.

* As far as possible, a forest-based industry should produce its own raw material requirements.

* Natural forests would not be made available to industries for undertaking plantations and for other objectives.

* Forest produce would not be supplied to industries at concessional rates.
Mineral resources:
According to the geological survey of india, 50 important minerals and 400 major sites where these minerals occur. These can be classified into 4 categories.

1. Minerals of which indias exportable surplus can dominate the world market; to this category belongs iron-ore and mica.

2. Minerals of which the exportable surplus forms an important factor; these include manganese ore, bauxite, gypsum, and others.

3. Minerals in which it appears that the country is self sufficient; like sodium salts, glass sand, phosphates, etc.

4. Minerals for which india has to depend largely or entirely on foreign markets like copper, nickel, petroleum, lead, zinc, tin, mercury, platinum, graphite etc.
The various minerals can also be classified into three categories on the basis of their nature and end use.

1. Fuels like coal, lignite, natural gas, petroleum.

2. Metallic minerals like bauxite, iron-ore, manganese, etc.

3. Non-metallic minerals like graphite, gypsum, limestone, mica, etc.
More important, in terms of value, among these are fuels, which accounts for about 85% of the total value of mineral production in the country. Metallic and non-metallic minerals accounts for 6-7% of total mineral production.
Mineral reserves are present in a limited quantity and they can be exhausted. So we should follow the following methods while mobilising mineral resources.

* Minimise or reduce wastage by recovering as much as possible and leaving nothing as waste.

* The quality of lower grade ore can be improved by processes which remove undesirable materials like earth, rock etc.

* Scraps of used metals can be recycled or used again.

* The natural environment of the area from where the mineral ores have been taken out needs to be protected from deterioration.

* Replacement of critically endangered minerals by abundantly available minerals. For example the alloys of magnesium are fast replacing steel and are also reducing the demand for copper, lead and tin which are in short supplies.
Why national mineral policy came:
Minerals provide a base for the rapid industrialisation of the economy. The changeover to an open market economy has opened up further avenues for faster industrial growth and greater requirement of minerals.
So for giving proper attention for their development a mineral policy is required, because in our country,

* Mineral resources are very unevenly distributed.

* The country is deficient in certain minerals like crude oil or petroleum.

* There are minerals, which are lucrative foreign exchange earners. Efforts should be made to devise a suitable policy to have a proper utilisation of these minerals.

* Due to paucity of funds, the mining industry is mired in obsolete technology.
The national mineral policy was announced in 1990 and was further modified in 1993.
Objectives:

1. To strike a balance between conservation and development.

2. Smooth and uninterrupted development of mineral industry.

3. To minimise the adverse effects of mineral developments on forests, environment and ecology through appropriate protective measures and ensure conduct of mining operations.

4. While planning development of mineral resources, to take into account national and strategic considerations and ensure their adequate supply and best use keeping in view present needs and future requirements.

5. To ensure establishment of appropriate educational and training facilities for human resources development to meet the manpower requirements of the mineral industry.
Energy resources:
Energy in india is produced from different sources. These sources can be classified into two groups.

1. Commercial sources like thermal power, hydel power, power from oil, gas, nuclear fuels, etc.

2. Non-commercial sources like firewood, dunk cakes, etc.
First let us see the sources of commercial energy in india,
Coal:
Coal is the largest occurring source of commercial energy in india and has been one of the principal sources of power production.
Indias coal reserves are mainly clustered around belt extending over the western part of west Bengal, south bihar, Orissa, north-eastern and central Madhya Pradesh and the eastern fringe of Andhra Pradesh. There are also some scattered deposits in assam. In india about 27% of coals are coking coal and 73% are non coking variety. Generally non-coking coal is suitable for power generation and the coking coal is for metallurgical purposes. The country has some lignite and tertiary coal deposits also.
The main problem, which is being faced by the coal industry is lack of suitable means of transportation and environmental clearance issues. Almost the entire amount of coal is being carried by the railways. Non-availability of wagons often leads to accumulation of stocks at pitheads and shortage in consumer areas. The transport planners will have to pay adequate attention to this aspect of the problem.
Oil (petroleum):
In india the oil reserves are located in assam, gujarath, Bombay high, arunachal Pradesh and tamil nadu areas. Bombay high off-shore oil is accounting for about 70% of countrys total oil production. Off-shore oil is being produced at Bombay basin, Krishna-godavary basin and Cauvery basins. Through all these discoveries oil production in india has been in a increasing trend.
Natural gas:
Natural gas occurs in two forms,

1. Associated gas- produced from underground reservoir along with oil.

2. Free gas- though occurring in the underground reservoir it is not associated with the oil.
Natural gas can be used for both domestic and industrial purposes. It also used in fertiliser and petrochemical industries. While government policy in the past has favoured the reservation of natural gas for fertiliser petrochemicals and non-fuel uses, the picture on supply side and in terms of the potential demand for natural gas has changed substantially in recent years.
After the emergence of ONGC substantial gas reserves have been located in different parts of the country they are, cambay basin, upper assam, Bombay high, south basin and other areas of Indian sedimentary basin such as Krishna-godhavari, jaisalmer, Tripura, cachar, Bengal, and the Himalayan foot hills.
In view of the increasing significance of gas in the energy scenario, the government has set up an organisation called the gas authority of india limited (GAIL), to look after the functions of processing, transportation and marketing of natural gas.
Hydro power:
Hydro electric power plays a major role in the field of power development in the country. Its present contribution to the total electricity generation is around 20%.
If we develop some factors like advanced technology in power generation, high voltage transmission system. It is possible to generate more electricity from the hydro power.
New sources:
A few new sources of energy are nuclear energy, gobar gas, wind power geothermal energy and solar energy.
Sources of non-commercial energy:
This includes fuel-wood, agricultural waste and animal dung.
This energy is mostly used in the domestic sector.
Nature of energy problem:


It will continue in the next month competition.....
by Dharmendra R

Reference:

1. IGNOU-economy-features of Indian economy.

2. NIOS-economy 10th std.

3. Public administration in india by dr. B.l. fadia and dr. Kuldeep fadia.

4. 4.http://www.jstor.org/discover/10.2307/41853867?uid=2134&uid=2477452497&uid=2&uid=70&uid=3&uid=2477452487&uid=60&sid=21103139323777

5. 5.http://www.jstor.org/discover/10.2307/41853867?uid=2134&uid=2477452497&uid=2&uid=70&uid=3&uid=2477452487&uid=60&sid=21103139323777

6. http://www.preservearticles.com/2012032829046/what-is-the-meaning-and-aim-of-social-forestry.html

Centre-state Relations

A.245 : Parliament can legislate on whole territory, can also make extra-territorial legislations.


A.246 : Divides Legislative Powers into 3 Lists in 7th Schedule
Union ( 97 items ) Defence, foreign affairs, shipping, railways
Concurrent ( 47 ) Uniformity is desirable but not essential. ex: detention, marriage, electricity, trade unions.
Sate List ( 66 ) public order, forest, public health, agriculture.


However, centre can legislate on state list subjects in certain exceptional circumstances.


Strong Centralizing tendencies:

1. A. 249: 2/3rd majority is R.S in the interest of nation.

2. A. 250: Proclamation of emergency. ( national emergency )

3. A. 252: two or more states approach parliament and adopt parliaments legislation. Only Parliament can then amend it.

4. A. 253: implementation of international treaty.

5. A. 254: Conflict between state and central law on concurrent list, central law prevails.

6. A. 356: Presidents rule (failure of constitutional machinery ); Parliament can legislate on state list subjects.

7. A. 352: National emergency-- war or armed rebellion; Parliament to legislate on state list.

8. A. 360: Financial Emergency -- money bills of state to be reserved for presidents consideration.

9. Residuary powers with the Parliament.

10. Planning Commission: Discretionary grants.

11. A. 256: execution of central law by states; centre can issue directions, violations attracts presidents rule.

1. ex: protection of railways( union list), by state police ( under states control )

2. extra cost are paid by centre.

12. A. 280: governor can entrust union executive machinery with the executive powers of the state.

13. A. 201: President withholds assent to bills reserved by governor for presidents consideration. Absolute veto.

14. Appointment of governor.


Protection of Federalism/Federal Structure:

1. Residuary power is assigned to centre only when it cannot be comprehended in any of the items enumerated in seventh schedule.

2. Doctrine of pith and substance: protects against disguised encroachment of centre on items of state list, if the pith and substance of legislation lies within sphere of states competence.

3. Needs 2/3rd majority in R.S to legislate on state list items, difficult to obtain in the era of coalition politics.

4. under A. 252: Parliaments power to legislate on state list extends to only those two or more states which have voluntarily agreed; it is not coercive.

5. A. 254: if presidents prior assent is taken, then states law prevails unless specifically nullified by the parliament.

6. A. 368 : amendment of constitution which affects states representation in R.S and amending any matter in seventh schedule requires prior assent of president.

7. A. 271: Income tax proceeds are distributed b/w state and centre on the basis of recommendations of finance commission.

8. Finance commission: principles of devolution of resources to states are generally followed. Deserving state gets its due share without becoming a matter of politics.

9. A. 257: when president delegates executive power of centre on states, the extra cost of arising out of carrying out of such functions are compensated to states.


Means of cooperation between centre and states:

1. A. 261: Full faith and credit to all public acts, records, judicial proceeding of union and all states.

2. A. 262: Settlement of inter-state water disputes through water tribunals.

3. A. 263: Inter-state council: to coordinate between centre and states and among states themselves. enquires and advices in matters of disputes.

4. All India services maintain unity of the country.

5. NDC approves plans of the planning commissions.

6. Zonal councils.

7. National integration councils.



Issue Areas

1. Appointment of governor is partisan.

2. unreasonable imposition of Presidents rule owing to political considerations.

3. Discretionary grants by planning commission.

4. Plans of Planning commission covers entire field of administration and states owing to lack of funds adhere to the plans dictated by the P.C. This hampers states ability to cater to their own region specific requirements.


Suggestions

1. Planning commission should set broad targets for planning and stop micromanaging plan formulation of various ministries. Ministries should form their own plans which P.C may consider for approval.

2. There is a need to evolve bottom-up approach to planning where various ministries and states formulate their plans considering the utility of such plans. Later, they should be incorporated in Planning commissions plan.

3. Sarkaria: NDC ---> NEDC. should meet frequently, at least twice a year.

4. Sarkaria: Impose presidents rule sparingly.

5. Sarkaria: Centre should consult states before making a law on concurrent list.

6. Sarkaria and Punchhi: a person who is eminent person in public walks of life, outside state, and a detached person be appointed as governor. He should be given fixed tenure of 5 years term.

7. Punchhi

1. under A.201, president should return bill within 6 months, if he asks for modification of bill or totally rejects it, reasons for the same have to be stated.

2. constitutional procedure for appointment of governor and provide for his impeachment in the lines of A.61 ( presidents impeachment ).

3. Provision of localized emergency at district or sub-parts of district under governors rule for maximum 3 months period.

4. zonal councils should meet at least twice a year.

5. Create all India services in health, education, engineering and judiciary fields. Further strengthen current all india services.

6. Finance commission should be made a permanent body.

7. P.C should stop micromanaging plan formulation.
Conclusion

1. Coalition era: political consideration weigh higher than financial and administrative considerations.

2. P.C grants, a quantitative look at grants doesnt show any glaring discrimination among states allocation of planned expenditure.

3. national flagship programmes like MNREGA, NRHM, SSY have been brought through unilateral legislation of centre, there is a need to obtain inputs and consensus of states before enactment of them. A more collaborative approach is needed.

4. In case of GST, thankfully, the discussions are on the basis of facts and mutual interest. this reflects hallmark of federation.

issues:

1. NCTC: fear of loss of federal autonomy; law and order is in state list. Preventive detention in concurrent list.

2. GST: central service tax and states sales tax are to be brought under gst.

3. teesta river sharing: states interference in foreign policy of india; coalition dharma becomes important.

4. Tamil autonomy in Srilanka: politics around public opinion in state are dictating indias foreign policy.
Rajshekhar Gidnavar

References:
1. arora and goyal: Indian public administration
2. The HIndu news Paper.