India's top policy forum meets Saturday amid farm sector woes

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New Delhi, July 22: Prime Minister Manmohan Singh will Saturday preside over a meeting of the National Development Council (NDC), the country's top policy forum, for a mid-term review of the 11th Five Year Plan (2007-12) amid serious concerns over the performance of the farm sector.

The meeting, the council's 55th since its inception Aug 6, 1952, comes against the backdrop of a major drop in the contribution of the country's farm sector, which employs nearly two-thirds of the workforce, to below 15 percent of India's gross domestic product for the first time ever last fiscal.

Ahead of the crucial meeting, to be attended by all chief ministers, members of the Planning Commission and key members of the central cabinet, a discussion paper prepared by the plan panel identified five specific areas of constraints.

Besides agriculture, the other four areas of concern highlighted were: Management of water resources, power generation targets, issues of urbanization and specific problems of tribal development.

"This note draws attention to problems in some selected areas which not only call for mid-course correction, but also identifies constraints that are important for Twelfth Five Year Plan," said the paper, a copy of which was obtained by IANS.

At the outset, the discussion paper conceded that the target of 4-percent growth in agriculture will not be achievable, given the expansion of farm output of a mere 0.2 percent last fiscal and 1.6 percent a year ago.

Among the measures, the paper suggested a sharp cut in the taxes on agriculture produce to less than 1 percent, better cooperative credit, crop diversification, better seeds, soil-based nutrients and more water.

The paper also identified availability and management of water as a challenge in equal measure, especially for agriculture that uses 78 percent of this resource, and called for major reforms in the irrigation system and use of groundwater.

Even in the case of electricity generation, the paper says the target of 78,000 mw will be unlikely to be met, with additional capacity generation of around 62,000 mw, calling for measures such as reduction in transmission losses.

"If the economy is to move to a higher growth path of 9-10 percent in the 12th Plan, we have to aim at even faster expansion in power generation in the years ahead," the discussion paper said.

The paper also sought to warn that urban poverty will be another major problem that the country will face. Already some 350 million people live in urban areas, and remain underserved by utilities, and the number will double in 25 years.

"The very realisation of the ambitious goal of 9-10 percent growth in gross domestic product (GDP) will itself depend on making Indian cities more liveable, inclusive, competitive and sustainable," said the paper.

The note by the plan panel also said that the country's tribals, who account for 8.2 percent of the population had not benefited adequately from India's development.

Taking literacy as a yardstick, the paper said while this measure of human development had increased from 8.53 percent in 1961 to 47.1 percent now, the gap with the general population was still high at 18 percentage points.

It said even though the tribal sub-plan incorporated into the planning process was an important instrument for flow of adequate funds for such areas, the implementation had not been satisfactory, both at the central and state levels.

The paper also sought to link the lack of adequate development in tribal areas to left-wing extremism by quoting Finance Minister Pranab Mukherjee's budget speech in February where he promised coordinated steps in 33 such affected districts.

Accordingly, the paper said, the plan panel has initiated a consultative process to prepare an action plan that will address a range of development and security measures, with an assurance of adequate funding by the finance ministry.

The prime minister had also said last week that developmental issues in Maoist-affected states will be discussed in greater detail in the NDC meeting and that the state of affairs in tribal areas needed to be changed.

"For far too long have our tribal brothers and sisters seen the administration in the form of a rapacious forest guard, a brutal policeman, a greedy patwari (revenue official). It is time that we provided a better delivery of service and one which is sensitive," he said.

The 11th Five Year Plan was approved by the NDC Dec 19, 2007 with an outlay of Rs.36.44 trillion ($910 billion at the then exchange rate) with the central theme - "Towards Faster and More Inclusive Growth".

(Rana Ajit can be reached at rana.ajit@ians.in [2] and biz@ians.in [3])