[Economic and social issues]

Chapter 4

[Poverty alleviation and employment generation in India]

Introduction:

In 2012, the Indian government stated 21.9% of its population is below its official poverty limit.
The World Bank, in 2011 based on 2005's PPPs International Comparison Program, estimated
23.6% of Indian population, or about 276 million people, and lived below $1.25 per day on
purchasing power parity.

The five year plans immediately after independence tried to focus on poverty alleviation through
sectoral programmes. The first five year plan focused on agricultural production as a way of
addressing poverty while second and third plans focused on massive state led investments for
employment generation in public sector. While these policies did some policy generation, they
did not have enough strength to effect a sweeping effect..

5 years plans:

First Plan (1951 − 56)

It was based on Harrod-Domar Model. Community Development Program was launched in

1952. Emphasized on agriculture, price stability, power & transport. It was more than a success,
because of good harvests in the last two years.

Second Plan
Second Plan (1956 − 61) Also called Mahalanobis Plan after its chief architect. Its objective was
rapid industrialization. Advocated huge imports which led to emptying of funds leading to foreign
loans. It shifted basic emphasis from agriculture to industry far too soon. During this plan, price
level increased by 30%, against a decline of 13% during the First Plan.

Third Plan
Third Plan (1961 − 66) At its conception time, it was felt that Indian economy has entered a
take-off stage. Therefore, its aim was to make India a ‘self-reliant’ and ‘self-generating’
economy. Also, it was realized from the experience of first two plans that agriculture should be
given the top priority to suffice the requirement of export and industry. Complete failure due to
unforeseen misfortunes, viz. Chinese aggression (1962), Indo-Pak war (1965), severest drought
in 100 years (1965 − 66).

Three Annual Plans (1966 − 69): Plan holiday for 3years. The prevailing crisis in agriculture
and serious food shortage necessitated the emphasis on agriculture during the Annual Plans.
During these plans a whole new agricultural strategy involving wide-spread distribution of High-
Yielding Varieties of seeds, the extensive use of fertilizers, exploitation of irrigation potential and
soil conservation was put into action to tide-over the crisis in agricultural production. During the
Annual Plans, the economy basically absorbed the shocks given during the Third Plan, making
way for a planned growth.

Fourth Plan
Fourth Plan (1969 − 74). Main emphasis on agriculture’s growth rate so that a chain reaction
can start. Fared well in the first two years with record production but last three years were failure
because of poor monsoon. Had to tackle the influx of Bangladeshi refugees before and after
1971 Indo-Pak war.

Fifth Plan
Fifth Plan (1974 − 79) The fifth plan prepared and launched by D D Dhar proposed to achieve
two main objectives viz, ‘removal of poverty’ (Garibi Hatao) and ‘attainment of self reliance’
through promotion of high rate of growth, better distribution of income and a very significant
growth in the domestic rate of savings. The plan was terminated in 1978 (instead of 1979) when
Janta Govt. Came to power.

Rolling Plan
Rolling Plan (1978 − 80) There were 2 Sixth Plans. First one is by Janta Govt (for 78 − 83)
which was in operation for only 2 years. Second is by the Congress Govt. when it returned to
power in 1980.

Sixth Plan
Sixth Plan (1980 − 85) Objectives: Increase in national income, modernization of technology,
ensuring continuous decrease in poverty and unemployment, population control through family
planning, etc.

Seventh Plan
Seventh Plan (1985 − 90) The Seventh plan emphasized policies and programs which aimed at
rapid growth in food-grains production, increased employment opportunities and productivity
within the framework of basic tenants of planning. It was a great success, the economy
recorded 6% growth rate against the targeted 5%.

Eighth Plan
Eighth Plan (1992 − 97) The eighth plan was postponed by two years because of political
upheavals at the Centre and it was launched after a worsening Balance of Payment position
and inflation during 1990 − 91. The plan undertook various drastic policy measures to combat
the bad economic situation and to undertake an annual average growth of 5.6% Some of the
main economic performances during eighth plan period were rapid economic growth, high
growth of agriculture and allied sector, and manufacturing sector, growth in exports and imports,
improvement in trade and current account deficit.

Ninth Plan
Ninth Plan (1997 − 2002) It was developed in the context of four important dimensions: Quality
of life, generation of productive employment, regional balance and self-reliance.

Tenth Plan
Tenth Plan (2002 − 2007) to achieve the growth rate of GDP@8%.
Reduction of poverty ratio to 20% by 2007 and to 10% by 2012.
Providing gainful high quality employment to the addition to the labour force over the tenth plan
period.
Universal access to primary education by 2007.
Reduction in gender gaps in literacy and wage rates by atleast 50% by 2007.
Reduction in decadal rate of population growth between 2001 and 2011 to 16.2%.
Increase in literacy rate to 72% within the plan period and to 80% by 2012.
Reduction of Infant Mortality Rate (IMR) to 45 per 1000 live births by 2007 and to 28 by 2012.
Increase in forest and tree cover to 25% by 2007 and 33% by 2012.
All villages to have sustained access to potable drinking water by 2012
Cleaning of all major polluted rivers by 2007 and other notified stretches by 2012
Tenth Plan (2002–2007)
The main objectives of the tenth Five Year Plan of India were:
Attain 8% GDP growth per year.
Reduction of poverty rate by 5 percentage points by 2007.
Providing gainful and high-quality employment at least to the addition to the labor force.
Reduction in gender gaps in literacy and wage rates by at least 50% by 2007.
20-point program was introduced.
Target growth:8.1% Growth achieved:7.7%

Eleventh Plan
Eleventh Plan (2007-2012)
The overall and comprehensive picture of the growth and plan performance during the 11th Five
Year Plan (2007 – 2012) and performance of various Flagship programmes being implemented
in the state for Economic growth, Ensuring Equity and Social Justice

Twelvth Plan
Twelvth Plan (2012–2017)
12th Five Year Plan (Government of India)
The Twelvth Five-Year Plan of the Government of India has decided for the growth rate at 8.2%
but the National Development Council (NDC) on 27 Dec 2012 approved 8% growth rate for 12th
five-year plan.

Poverty alleviation programmes in India:

The poverty alleviation programmes in India can be categorized based on whether it is targeted
for rural areas or urban areas. Most of the programmes are designed to target rural poverty as
the prevalence of the poverty is high in rural areas. Also targeting of the poor is challenging in
rural areas due to various geographic and infrastructure limitations.

The programmes can be mainly grouped into

1) Wage employment programmes,

2) Self-employment programmes,

3) Food security programmes,

4) Social security programmes and

5) Urban poverty alleviation programmes

Some major schemes:-

National rural employment guarantee act (NREGA)

The NREGA bill notified in 2005 and came into force in 2006 and further modified it as
the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) in 2008.
This scheme guarantees 100 days of paid work to people in the rural areas. The scheme
has proved to be a major boost in Indian rural population's income.

To augment wage employment opportunities by providing employment on demand and

by specific guaranteed wage employment every year to households whose adult
members volunteer to do unskilled manual work to thereby extend a security net to the
people and simultaneously create durable assets to alleviate some aspects of poverty
and address the issue of development in the rural areas.

The Ministry of Rural Development (MRD) is the nodal Ministry for the implementation of
NREGA. It is responsible for ensuring timely and adequate resource support to the
States and to the Central Council. It has to undertake regular review, monitoring and
 evaluation of processes and outcomes. It is responsible for maintaining and operating
the MIS to capture and track data on critical aspects of implementation, and assess the
utilization of resources through a set of performance indicators. MRD will support
innovations that help in improving processes towards the achievement of the objectives
of the Act. It will support the use of Information Technology (IT) to increase the efficiency
and transparency of the processes as well as improve interface with the public. It will
also ensure that the implementation of NREGA at all levels is sought to be made
transparent and accountable to the public. Now 100 to 150 days work for all is provided.

PM Fasal Bima Yojana

 Premium: 2% on Kharif crops, 1.5% on Rabi, 5% on commercial and horticulture

crops

 Agriculture Insurance Company of India and also Private companies will provide
the insurance

 Apart from yield loss, the new scheme will cover post-harvest losses also.

 The scheme proposes mandatory use of remote sensing, smart phones and
drones for quick estimation of crop loss. This will speed up the claim process.

 This scheme provides full coverage of insurance

 It also covers the localized risks such as hailstorm, landslide, inundation etc.

 Administered under the Ministry of Agriculture and Farmers’ Welfare,

Government of India

Pradhan Mantri Krishi Sinchai Yojana

“Har Khet Ho Pani” “Per Drop More Crop”

 28.5 lakh hectares to be brought under irrigation in an integrated approach

 towards irrigation instead of a fragmented one so far

 Components: (1) Per Drop More Crop (efficiency) (2) Har Khet ho Pani —
 command area development (3) AIBP — faster completion of major and medium
 irrigation programs (4) Watershed development

 PMKSY has been formulated amalgamating ongoing schemes viz. Accelerated

 Irrigation Benefit Programme (AIBP) of Ministry of Water Resources, River
 Development & Ganga Rejuvenation; Integrated Watershed Management Programme
(IWMP) of Department of Land Resources; and On Farm Water
 Management (OFWM) component of National Mission on Sustainable Agriculture
 (NMSA) of Department of Agriculture and Cooperation.
Start Up India (Ministry of Finance)

 Self-certification
 Rs. 10,000 crore Start-up fund
 No capital gains tax on venture capital investments
 No Income tax for three years
 Atal Innovation Mission
 Faster exit.
 A mobile app to enable registration in a day. to be launched on 1st April 2016

UDAY (Ujjawal Discom Assurance Yojana)

Ministry of Power

 Objective- financial turnaround of Power Distribution Companies

 The weakest link in the value chain is distribution, wherein DISCOMs in the country have
accumulated losses of approximately Rs. 3.8 lakh crore and outstanding debt of
approximately Rs. 4.3 lakh crore

 Four initiatives (i) Improving operational efficiencies of DISCOMs; (ii) Reduction of cost
of power; (iii) Reduction in interest cost of DISCOMs; (iv) Enforcing financial discipline
on DISCOMs through alignment with State finances.

 States shall take over 75% of DISCOM debt as on 30 September 2015 over two years -
50% of DISCOM debt shall be taken over in 2015-16 and 25% in 2016-17. (This debt
taken by states will not be calculated as a part of state fiscal deficit for 2015-16 and
2016-17 years

 UDAY is optional for all States

PM Ujjawala Yojana
Ministry of Petroleum and Natural Gas

 Providing free LPG connections to women from BPL households

 Financial support of Rs. 1600 for each LPG connection for BPL

 Earmarked Rs. 8000 crore for providing 5 crore LPG connections to BPL households.

 This Scheme would be implemented over three years, namely, the FY 2016-17, 2017-18
and 2018-19

 Budgetary provision of Rs. 2000 crore for 2016-17 to provide deposit free LPG
connections to 1.5 crore women belonging to the Below Poverty Line (BPL) families.
Setu Bharatam Project
Ministry of Road and Transport and Highways

 To make all the national highways railway crossings free by 2019

 208 Railway Over Bridges (ROB)/Railway Under Bridges (RUB) will be built at the level
crossings at a cost of Rs. 20,800 crore as part of the programme.

Shyama Prasad Mukherjee National Rurban Mission

Ministry of Rural Development

 Rurban clusters will be developed to create over 300 smart villages in the next 3 years

 Analysis of demography, economy, tourism and pilgrimage significance and

transportation corridor

 outlay of Rs. 5142.08 crores (remember 5000 crores)

 The clusters will be geographically contiguous Gram Panchayats with a population of

about 25000 to 50000 in plain and coastal areas and a population of 5000 to 15000 in
desert, hilly or tribal areas.

Stand up India

 To boost entrepreneurship among SC/ST women,

 Refinance window through SIDBI with initial corpus of Rs. 10,000 crore
 Creation of credit guarantee through National Credit Guarantee Trustee Company
(NCGTC)

PRAGATI (pro active governance and timely implementation)

 The platform is aimed at addressing common man’s grievances, and simultaneously

monitoring and reviewing important programmes and projects of the Government of
India as well as projects flagged by State Governments

 ICT based multi-modal mechanism to track key projects and policy outcomes

 Uses digital data management, geo-spatial technology and video-conferencing

 Three tier system: PMO, Union Government Secretaries and Chief State Secretaries
Housing for All

 2.95 crore houses in rural areas to be built by 2022

 Socio economic and caste census (SECC) will be used to identify beneficiaries

 Central government to state government ratio will be 60:40 for plain area states and
90:10 for north eastern and hilly states

 Houses constructed under the mission would be allotted in the name of the female head
of the households or in the joint name of the male head of the household and his wife

Make in India
DIPP — Ministry of Commerce & Industry

 Body named “Invest India” created in partnership with FICCI and State governments
 Ease of Doing Business
 E-Biz Portal

AMRUT (Atal Mission for Rejuvenation and Urban Transformation) and Smart Cities
Mission
Ministry of Housing

 Clean drinking Water

 Sanitation
 Solid Waste management
 Efficient urban mobility and public transportation
 Affordable housing for the poor
 IT connectivity
 E-governance

Swaachh Bharat Mission

Ministry of Drinking Water and Sanitation

1. ODF Free India

2. Build 48000 toilets per day
3. Solid & Liquid Waste Management
4. Water pipeline sin villages to enable tap connections
5. Toilets for boys and girls in the schools
6. PPP and CSR funds through SPVs
7. Cadres of Sanitation Coordinators and Swatcchhta Doots
8. Convergence with various ministries including Panchayati Raj Ministry, Women and Child
Welfare, MPLADS program, schemes such as MNREGA, BRGF, National Rural Drinking Water
program etc.

Deen Dayal Upadhyay Grameen Kaushal Yojana

Ministry of Rural Development
  Demand led skill training at no cost to the rural poor

 Mandatory coverage for SC/ST, minorities and women

 Greater emphasis on rural poor youth of J&K (HIMAYAT) and NE (ROSHINI)

Pradhan Mantri Suraksha Bima Yojana

Ministry of Finance

 Personal Accident Insurance Scheme (for death and disability due to accident)

 Rs. 2 lakh accident coverage

 Public Sector General Insurance Companies to administer and offer, and others also
allowed if agreed to the terms

 Savings bank holders of Age: 18-70 years (must have a bank account)

 Rs. 12 per annum premium

Atal Pension Yojana

Ministry of Finance

 Unorganized sector old age pension scheme

 Will be under National Pension Scheme run by the PFRDA

 Receive Rs. 1k, 2k, 3k, 4k or 5k per month depending on their contributions after
 age of 60 years

Pradhan Mantri Jeevan Jyoti Bima Yojana

Ministry of Finance

 Rs. 2 lakh life insurance

 Administered through LIC

 18-50 years age

 Covers death due to any reason

 Rs. 330 per annum premium

 Savings bank holders only

Beti Bachao, Beti Padhao
Ministry of Women and Child Development

1. Activate School Management Committees to ensure universal enrollment of girls

2. Balika manch in schools
3. Construction of toilets in schools
4. Completion of Kasturba Gandhi Bal Vidhyalayas
5. Girl Hostels

National Skill Development Mission

National Skill Development Corporation

NSDC: 49% Gov. and 51% Private

Deendayal Upadhyaya Gram Jyoti Yojana

Ministry of Power

1. Rural electrification
2. Strengthening of transmission and distribution infra.
3. Separation of agri and non-agro feeders to enable judicious supply of electricity to agro and
non-agro users respectively.
4. This used to be RG Gram Vidyutikaran Yojana

Pradhan Mantri Kaushal Vikas Yojana

Ministry of Skill Development and Entrepreneurship

1. under National Skill Development Corporation

2. Standards: Standardize certification process
3. Mobilize youth for skill development and training
4. Monetary awards for skill development
5. Increase employability
6. Rs. 8000 award for skill undergoing training
7. Under NSDC — PPP organization

MUDRA
SIDBI

 It’s a regulatory institution to provide impetus to micro-unit credit and financing.

 Set-up as a subsidiary of SIDBI
 It cannot take demand deposits
 Its primary work would be to register, regulate, refinance and rate MFIs and help them in
refinancing MSMEs
 MUDRA bank will get 20000 crore from RBI from funds of PSL not used by banks and
given to NABARD or SIDBI
PM Jan Dhan Yojana
Dept. of Financial Services — Ministry of Finance

1. RuPay Card — payment gateway

2. Inbuilt accident insurance of Rs. 1 lakh
3. Inbuilt life insurance of Rs. 30,000
4. RuPay by National Payments Corporation of India (NPCI)
5. opening of jan dhan accounts
6. linking of other services like insurance, investments (MF etc) with Jan Dhan Accounts in
phase 2 of the scheme

All the best