Showing posts with label CURRENT ECONOMY. Show all posts
Showing posts with label CURRENT ECONOMY. Show all posts

Friday, May 11, 2012

National Policy on Microfinance

Planning Commission had constituted a High Level Committee on financial sector reforms under the Chairmanship of Shri Raghuram G. Rajan, Professor, Graduate School of Business, University of Chicago in August, 2007. The Committee submitted the report in September, 2008.

The Committee observed that, “despite its success, the future growth of microfinance is constrained by a number of factors. An important issue is the ability of MFIs to raise financing. Given the large estimated demand for microcredit, MFIs need multiple sources of financing, apart from the traditional loan financing from banks. Other constraints include an unclear regulatory environment and the lack of well-developed management information systems and an adequate supply of trained management talent to facilitate sustainable scaling up.”

To provide a formal statutory framework for the promotion, development, regulation and orderly growth of the micro finance sector and thereby to facilitate universal access to integrated financial services for the unbanked population, the Department of Financial Services is formulating Micro Finance Institutions (Development and Regulation) Bill 2012.

Saturday, May 5, 2012

U.S. unemployment ticks down to 8.1 per cent


In a development that is likely to buoy the Obama White House's election prospects in November, the U.S. economy's unemployment rate continued its slow but steady declining trend, inching down from 8.2 per cent in March to 8.1 per cent in April.
Announcing the monthly data release, the U.S. Bureau of Labour Statistics (BLS) noted that non-farm payroll employment rose by 1.15 lakh in April, yet it described the unemployment rate for the month as “little changed.” At the macro level, employment increased in professional and business services, retail trade, and health care, but declined in transportation and warehousing, the BLS added.
Although the number of unemployed persons remained worryingly high at 12.5 million, the White House struck a cautiously positive note about the data.
Alan Krueger, Chairman of President Barack Obama's Council of Economic Advisers, said “Today's employment report provides further evidence that the economy is continuing to heal from the worst economic downturn since the Great Depression, but much more remains to be done to repair the damage caused by the financial crisis and the deep recession.”
While Mr. Krueger emphasised that private employer payrolls increased by 1.30 lakh jobs in April and the unemployment rate had fallen by one percentage point, from 9.1 in August, the BLS cautioned that the civilian labour force participation rate declined in April to 63.6 per cent.

Friday, May 4, 2012

Cooperative Credit System

The Interest Subvention Scheme is being implemented by the Government of India since 2006-07 to make short term crop loans upto Rs. 3 lakh for a period of one year available to farmers at the interest rate of 7% per annum. Interest Subvention is provided to Public Sector Banks, Regional Rural Banks and Cooperative Banks to meet the difference between the cost of their own funds and the lending rates on such loans. The Government has released Rs.1356.64 crore to cooperative banks through NABARD towards Interest Subvention between 2006-07 and 2010-11.

Friday, April 20, 2012

Web Portal of DGET for Effective Implementation of Skill Development Scheme (SDIS) Unveiled

Union Labour & Employment Minister Shri Mallikarjun Kharge today unveiled and dedicated the Official Web portal Directorate General of Training & Employment (DGET), M/o Labour & Employment to the nation for the effective implementation of Skill Development Scheme (SDIS) to promote training of around 6 lakh people in the Country annually. The portal is is developed by the Helwatt Paackard, India.

Unveiling the Web Portal Shri Kharge termed the occasion as a new beginning and is making one step forward in fulfilling the main aim of our Government to bring good governance. He said any Govt. scheme is always supported by funding incurred from public exchequer which needs to have a proper in-built mechanism to check & monitor the physical progress and financial expenditures on regular basis. Such a scheme like Skill Development Initiative encompassing a huge number of people from all over the country is quite difficult to handle and hence, tracking must be based on setting up of an efficient “Management Information System(MIS)”. I am quite confident that this powerful Web-portal would not only facilitate DGET in all these aspects but also enable to keep a track over outcome of the Scheme, Shri Kharge added.

The Minister said the National Skill Policy has been articulated at the behest of Prime Minister’s National Council on Skills Development. He reiterated the mission statement of the National Policy on Skill Development that it will empower all individuals through improved skills, knowledge and nationally-internationally recognized qualifications to gain access to decent employment and ensure India’s competitiveness in the global market. The minister said we must remember that this national Skill Policy is an integral part of comprehensive economic, labour and social policies so as to establish a framework for better coordination among various Ministries, States, industry and other stakeholders.

He expressed the hope that this On-line access to the countrymen from enrollment & admission to training and Certification will certainly begin a new chapter with true inclusiveness in the skill building process of our country.

In his welcome address, Shri Sharda Prasad,Director General, DGET and Joint Secretary in the M/o Labour & Employment said with this webportal, timely access to information across stakeholders would be available, thereby enabling better citizen centric services in a transparent manner. The SDIS Web Portal will also help in State Governments in registering candidates, the Vocational Training Providers (VTPs) and empanelled Assessing Bodies (ABs). It also tracks the creation of training/assessment batches, publishing test results and dispersal of online certificates.

The SDIS is a 100% Centrally Sponsored Scheme and is launched by the Directorate General of Training & Employment (DGET), M/o Labour & Employment for the early school leavers and existing workers especially in the informal sector. It was operationalised on 24th May, 2007 and initially the project target for training and testing of one million persons over a period of 5 years was fixed. Thereafter the the target of training of one million person per year has been taken up. The Modular Employable Skill (MES)- National Council for Vocational Training (NCVT) certificate issued after the prescribed training is recognized nationally and internationally for gainful employment.

Monday, April 16, 2012

DoT’s Power to impose Penalty on Operators for not completing Customer Verification upheld by TDSAT

The Department of Telcom's (DoT) power to impose penalty on operators for not dully completing formalities of customer verification for security purposes was upheld by tribunal Telecom Dispute Settlement Appellate Tribunal's (TDSAT). While delivering its judgement a two-member TDSAT bench stated that the matter related to the security of the nation so far as conduct of telegraph is concerned, can be implemented through conditions of licence.

TDSAT’s order followed a petition filed by the GSM lobby group COAI and various operators challenging the penalty imposed by the DoT. Operators had requested that the penalty regime introduced by DoT on 22 November 2006 be quashed as they felt that the penalty imposed by the DoT 's TERM Cell in various circles as illegal, arbitrary and suffering from procedural impropriety. Operators claimed that imposition of the Scheme of Financial Penalty for Violation of Terms and Conditions of the Licence Agreement for Subscriber Verification Failure Cases imposed by DoT was not countenanced under the terms of the licences.

TDSAT in response mentioned that the circular letters issued by the Respondent (DoT) for the aforementioned reason were not illegal or invalid. Also operators cannot be permitted to question the validity of those circular letters which have been issued three years prior to the date of filing of the petition being barred under law of Limitation as well in view of the doctrine of delay/latches on their part.

The TDSAT upheld TERM cell powers stating that DoT cannot be said to have acted illegally and without jurisdiction in delegating its power relating to making inspection, imposition of penalties and the determination thereof by authorities of the Term Cells and the Appellate Authority. The principle of Natural Justice was provided by DoT by providing enough safeguards to the operators to put their points on adverse findings.

Food Corporation of India (FCI) notified 10 Sites in States for Construction of Modern Silos/Mandis

The Food Corporation of India (FCI) in April 2012 notified 10 sites in States for construction of modern silos to be declared as mandis. The decision to construct silos/mandis reflected FCI’s objective to augment capacity for storing food-grains for the public distribution system. The mandis would be constructed to enable farmers to directly sell their produce.

The FCI Board of Directors headed by Chairman Siraj Hussain on 13 April 2012 decided that the silos shall be either located within the local mandi or declared as mandis by the States. The silos are to be located alongside railway sidings.

With the coming in of fresh stocks of wheat in the mandis, storage has become a major concern with the Food Ministry. Government needs to urgently accelerate creation of additional storage space to prevent rotting of grains stored in the open as well as to keep enough stocks to fulfil its obligation under the proposed National Food Security Act to provide by law subsidised foodgrains to the poor.

The government appointed M/s Mott McDonald as consultants for conducting a feasibility study on creation of modern storage facilities. The consultant submitted the final report to the Planning Commission in November 2011. Based on their proposals the Empowered Group of Ministers (EGoM) for Food approved the creation of facilities for storing 20 lakh tonnes of foodgrains in 10 States under its Private Entrepreneur Guarantee Scheme (PEG) wherein the FCI will give guarantee for hiring the facility for 10 years.

State-level panels

The FCI Board of Directors also set up State-level committees on silos headed by the zonal chief with representation from the Ministries of Food, Agriculture, and Railways, and mandis and States on it. The committee is responsible for approving the locations for godowns in each of the 10 States — Bihar, Haryana, Madhya Pradesh, Maharashtra, Punjab, Uttar Pradesh, West Bengal, Assam, Kerala, and Gujarat.

The Board directed that locations with high procurement and off-take of wheat be preferred for creation of silos. The location of silos is to be considered on the basis of wheat procurement and off-take in a revenue district. Each silo is to have a capacity of either 25000 tonnes or 50000 tonnes depending upon the availability of space under the Private Entrepreneur Guarantee Scheme. Each State will have to provide the space for construction of godowns. Creation of 51.25 lakh tonnes capacity in Punjab and 38.8 lakh tonnes in Haryana was recommended.

In the wheat procuring-cum-consuming regions of Madhya Pradesh, Uttar Pradesh and Bihar, silos have been sanctioned for additional capacity. Proposal for creation of 19.52 lakh tonnes in Madhya Pradesh and for 6.40 lakh tonnes in Bihar was also approved during the meeting of the FCI board on 13 April 2012.

The FCI Board decided that in the consuming regions of Maharashtra, West Bengal, Assam, Kerala and Gujarat the silos should have at least four-month storage capacity. The States which have not been able to sanction the capacity or start construction work for silos will have to let go and transfer their sanctioned capacity to another State. The States will have to provide land and invite tenders within three months following the approval of the location.

FDI Inflows into India’s Services Sector in India went up by 62% during April-January period 2011-12

Foreign direct investment (FDI) inflows into the services sector in India went up by 62% during April-January period 2011-12 on account of unfavourable economic conditions of the western markets.

The financial and nonfinancial services sector attracted FDI worth $4.83 billion during the 10-month period of 2011-12 as compared to $2.98 billion in the April-January period of 2010-11. The trend reflected confidence in India's growth story. It was observed that though the economic growth in India itself declined in 2011-12 to 6.9%, the economy was among the best performing in the world.

Despite taxation and policy issues, the country enjoys the investor confidence as is evident from a 53 per cent increase in total FDI inflows to $26.19 billion during the 10-month period (April-January 2011-12). The sectors that attracted sizeable FDI inflows include drugs and pharmaceutical ($3.20 billion), construction ($2.23 billion), telecommunications ($1.99 billion) and power ($1.56 billion).

The highest FDI of $8.91 billion came from the Mauritius, followed by Singapore ($4.30 billion) and Japan ($2.75 million).

Saturday, April 14, 2012

President calls for more public-private partnership, priority to research in PSEs


The President, Ms Pratibha Devisingh Patil, said on April 13 that the private and public need to work together more for the high demand from infrastructure investment.
This is while higher priority must also be given to research and innovation in public sector enterprises (PSEs) through in-house R&D facilities, apart from sponsored research with universities and industry, particularly when foreign collaboration is involved.
“The test is to be nationally creative, globally competitive and efficient, ensure on-time deliverability and provide employment,” Ms Patil said while presenting awards to top PSEs in the country for their operational excellence in 2010-11. The presentation took place during the Public Sector Day Celebrations organised jointly by Department of Public Enterprises (DPE) and Standing Conference of Public Enterprises (SCOPE).
“There should be a constant process of review and assessment, to ensure that best practices of corporate governance for production and management are followed, and innovative business practices are adopted. Public Sectors must make these elements an essential part of the functioning,” she added.
Also present in the occasion were the Minister for Heavy Industries & Public Enterprises, Mr Praful Patel and the Secretary of DPE, Mr O.P. Rawat.
Mr Patel said that investments by the 248 Central PSEs touched an all time high of more than Rs 6.66 lakh crore, which was 15 per cent more than the previous year. Turnover was more than Rs 14.73 lakh crore, which was over 18 per cent. He called upon the PSEs to increasingly compete internationally and said that the Ministry will help solve all the issues they face in doing so.
The SCOPE Gold trophy went to ONGC for Environmental Excellence, Steel Authority of India for Corporate Governance, NTPC and THDC for Corporate Social Responsibility, Indian Oil Corporation and Bharat Electricals for R&D, Technology Development, Bharat Heavy Electricals for Best practices in Human Resource Management. Meanwhile, Power Finance Corp got the award for best managed bank and financial institution and National Scheduled Castes Finance and Development Corp for best managed PSE setup.

International Operations of CPSEs


The Central Public Sector Enterprises (CPSEs) are increasingly into ‘International Trade’ in goods and services, which has a bearing on the Balance of Payments of the country.  During the year 2010-11, as many as 140 CPSEs out of the 220 operating CPSEs either had foreign exchange earnings (FEE) or foreign exchange expenditure(FEE).  As many as 39 CPSEs were net foreign exchange earners.  Out of these 39 CPSEs, 10 CPSEs, namely, ONGC VideshLtd., Air India Ltd., National Aluminium Company Ltd., Airports Authority of India Ltd., Bharat Heavy Electricals Ltd., Shipping corporation of India Ltd., Kudremukh Iron Ore Company Ltd., IRCON International Ltd., Cochin Shipyard Ltd. and RITES Ltd. earned net foreign exchange of more than Rs. 200 crore during 2010-11. 
Foreign Exchange Earnings
15 CPSEs namely, Indian Oil Corporation Ltd., Mangalore Refinery & Petrochemicals Ltd., Bharat Petroleum Corpn. Ltd., Bharat Heavy Electricals Ltd., Air India Ltd., ONGCVidesh Ltd., Hindustan Petroleum Corpn. Ltd., Oil & Natural Gas Corporation Ltd., Shipping Corporation of India Ltd., MMTC Ltd., National Aluminium Company Ltd., Ircon International Ltd., Airports Authority of India Ltd., PEC Ltd. and  Air India Charters Ltd. had gross foreign exchange earnings of more than Rs. 1000 crore, during 2010-11.  Out of these fifteen CPSEs namely, Air India, BHEL, ONGC Videsh, NALCO, SCIL, IRCON International Ltd. and Airport Authority of India Ltd. have been net foreign exchange earners.  Hindustan PetroleumCorpn. Ltd. and PEC Ltd.  have shown reduction in their foreign exchange earnings during 2010-11.  The remaining CPSEs have  had foreign exchange expenditure more than their foreign-exchange earnings.  This is particularly so in the case of Oil Marketing Companies (OMCs).
Sources of Foreign Earnings
Export of goods and merchandise, income from Royalty & Consultancy Services and interest earnings are the major sources of foreign exchange earnings.  Export of merchandise was the major source of foreign exchange earnings in both the years 2009-10 and 2010-11.  Its share in total earnings, however, decreased from 89.08% of the total in 2009-10 to 88.40% of the total in 2010-11.


Foreign Exchange Expenditure
In terms of growth and change in foreign exchange expenditure during 2010-11 over 2009-10 there was a significant increase in foreign expenditure in the case of MMTC Ltd., Handicrafts & Handloom Exports Corporation of India Ltd., GAIL(India) Ltd. and Oil & Natural Gas Corporation Ltd.  In the case of other CPSEs, like MSTC Ltd., ONGC VideshLtd., Shipping Corporation of India Ltd., Power Grid Corporation of India Ltd., Bharat Electronics Ltd. and Rashtriya Chemicals and Fertilizers Ltd., on the other hand, there was a general reduction in the foreign exchange expenditure. 
            There was a big increase in foreign expenditure of Handicrafts & Handloom Exports Corporation of India Ltd. during 2010-11 due to increased trading in bullion.  The Oil Marketing Companies (IOCL, BPCL, MRPL, CPCL, ONGC and GAIL) and others, namely, MMTC, SAIL, BHEL, RINL, SCI, BEL, HHEC, NTPC also incurred increase in gross foreign exchange expenditure during 2010-11.  Import of ‘raw materials’ and ‘capital goods’ have been the major items of  foreign exchange expenditure in both the years. 
            The share of ‘raw materials’/crude oil continued to claim the largest share (around 90%) of gross foreign exchange expenditures in both the years of 2009-10 and 2010-11. Exchange rate fluctuation and change in commodity prices have been also impacting the earnings and expenditures of CPSEs.
International Finance & Investment
Sources of Funds
International finance refers mainly to external commercial borrowings, supplier’s credit, funds raised through the equity market abroad.  Shares of MTNL (ADR) are listed on the New York Stock Exchange and GAIL (GDR) and SAIL(GDR)  are listed on the London Stock Exchange. 

Foreign Investments by CPSEs

Investment comprise off-shore investment by CPSEs through establishment of Indian subsidiaries abroad joint ventures (JVs) and mergers and acquisitions (M&A).  Several CPSEs have set up subsidiaries abroad for marketing their products, procuring raw materials and consolidating their international operations.  ONGC Videsh, in particular, has been successful in acquiring oil and gas assets abroad.  As on March 31, 2011, OVL has participation directly or through wholly owned subsidiaries/joint ventures in 33 exploration and production projects in 14 countries, comprising 9 producing assets, 4 assets under development and 19 exploration assets.  During 2010-11, the company produced 9.45 MMTOE, which accounted for 10.5 per cent of India’s total domestic oil and gas production.  The other CPSEs are following the lead given by OVL in international investments.  SAIL, CIL, RINL, NMDC and NTPC have together formed a JV in International Coal Ventures Pvt. Ltd. for acquisition of coal assets abroad.

Mega and Major Projects under Implementation by CPSEs


  • Central Sector Projects- In the central sector there were altogether 607 projects under implementation as on 31 March, 2011  of which 157 projects  were  Mega projects (each costing Rs. 1,000 crore and above), 450 Major projects  (each costing between Rs. 100 crore and Rs. 1000 crore).  The total estimated cost of these 607 projects works out to be Rs. 7,76,715.89 crore.  The total expenditure incurred on 607 Mega and Major projects stands at Rs. 3,55,698.64 crore as on 31 March, 2011.   
  • CPSEs Projects - Out of these 607 projects in the central sector, 170 projects (costing Rs. 500 crores and above) belonged to Central Public Sector Enterprises (CPSEs).  Of these 170 projects, 113 were Mega projects and 57 were Major projects. The total estimated cost in respect of these 210 projects of CPSEs stood at Rs. 4,59,799crore, while the revised/anticipated cost is equal to Rs. 5,07,459 crore
  • Atomic Energy - There were 4 projects in atomic Energy sector under implementation as on 31 March, 2011.  These projects belonged to the Nuclear Power Corporation of India Limited, Uranium Corporation of India Ltd. and Bhavini Limited and cost above Rs. 500  crore
  • Civil Aviation - There were 9 projects in the civil aviation sector under implementation, as on 31 March, 2011.  Of these, 2 were in Mega category, 7 in Major category.  All these projects belonged to Airport  Authority of India Limited.
  • Coal - There were 45 projects in the coal sector under implementation, as on 31 March, 2011.  Of these, 7 were in Mega category, 38 in Major category.  These projects belonged to Central Coal Fields Limited, South-Eastern Coal Fields Limited, Northern Coal Fields Limited, Singareni Colliers Company Limited and Neyveli Lignite Corporation Ltd. 
  • Fertilizers - There were 6 projects in the fertilisers sector under implementation as on 31 March, 2011.  Of these, 3 were in Mega category, 3 in Major category.  All these projects belonged to National Fertilisers Limited.  
  • Mines -  There was only one Mega project in the mining sector as on 31 March, 2011.  This belonged to National Aluminium Company Limited. 
  • Petroleum -  There were 82  projects in the petroleum sector under implementation, as on 31 March, 2011.  Of these, 40 were in Mega category and 42 in Major category. These projects belonged to Bharat Petroleum Corporation Limited, Bongaigaon Refinery & Petrochemicals Ltd., Gas Authority of India Limited, Hindustan Petroleum Corporation Limited, Indian Oil Corporation Limited and Oil & Natural Gas Corporation Limited.  
  • Power -  There were 87 projects in the power sector under implementation, as on 31 March, 2011.  Of these, 44 were in Mega category and 43 in Major category.  All these projects belonged to National Hydro-Electric Power Corporation, National Thermal Power Corporation, North East Electric Power Corporation, Satluj Jal Vidyut Nigam Limited, Power Grid Corporation of India Limited, and Tehri Hydro Development Corporation Limited. 
  • Shipping & Ports - There were 26 projects in the Shipping & Ports sector under implementation, as on 31 March, 2011.  Of these, 7 were in Mega category and 19 in Major category.  These belonged to Mumbai Port Trust and Shipping Corporation of India. 
  • Steel -  There were 19 projects under implementation in the steel sector, as on 31 March, 2011.  Of these, 6 were in Mega category and 13 in Major category.  These projects belonged to National Mineral Development Corporation, Rastriya Ispat Nigam Limited and Steel Authority of India. 
  • Telecommunication - There were 41 projects under implementation in the telecommunication sector as on 31 March, 2011.  Of these, 3 were in Mega category and 38 in Major category.  These projects belonged to Bharat Sanchar Nigam Limited. 
  • CPSEs Under Construction There are some CPSEs which yet to go on regular production on a commercial scale as they are at construction stage.  Many of these CPSEs are subsidiary companies set up by (Holding) CPSEs.   Some of these subsidiary companies are ‘shell companies’ which have been set up tentatively to facilitate the establishment of Ultra Mega Power Projects (UMPP) or similar other Projects.   The objective of ‘shell companies’ for UPMM is to develop large capacities of power generation in the different parts of the country.  It brings in the potential investors in UMPP after obtaining the necessary clearances.  The Power Finance Corporation Limited (PFCL) was selected as the Nodal Agency for the development of  such power projects by the Central Electricity Authority.  Many of the ‘shell companies’ are subsidiary companies of PFCL.  As on 31 March, 2011, there were altogether 28 CPSEs ‘under construction’, as against 32 as on 31 March, 2010.  While seven CPSEs ‘under construction’ existing in 2009-10 have been left out, three CPSEs have been added to this list during the financial year 2010-11.

Tuesday, March 20, 2012

Poverty dips to 29.8% in 2009-10: Plan panel


Poverty declined to 29.8 per cent in 2009-10 from 37.2 per cent in 2004-05, according to the Planning Commission. It estimated the total number of poor in the country at 34.47 crore in 2009-10, against 40.72 crore in 2004-05.
Poverty declined at a faster pace in rural India between 2004-05 and 2009-10, the Plan panel said in its estimates released on Monday. However, overall poverty is still more pronounced in rural India.
“The all-India head count ratio (HCR) has declined by 7.3 percentage points… with rural poverty declining by 8 percentage points from 41.8 per cent to 33.8 per cent and urban poverty declining by 4.8 percentage points from 25.7 per cent to 20.9 per cent,” according to an official statement.

THE MOST MARGINALISED

Among social groups in rural areas, 47.4 per cent Scheduled Tribes are the poorest, followed by Scheduled Castes at 42.3 per cent, Other Backward Castes at 31.9 per cent, against 33.8 per cent for all classes.
In urban India, SCs are the poorest at 34.1 per cent, followed by STs at 30.4 per cent and OBC at 24.3 per cent against 20.9 per cent for all classes.
Among religious groups, Muslims are the poorest in urban areas at 33.9 per cent. In rural areas, the HCR for Muslims is very high in Assam (53.6 per cent), Uttar Pradesh (44.4 per cent), West Bengal (34.4 per cent) and Gujarat (31.4 per cent).

FARM/CASUAL LABOUR POOREST

In the work segment, nearly 50 per cent of agricultural labourers are poor and 40 per cent of other labourers are below the poverty line in rural areas.
Even in the agriculturally prosperous States of Haryana, 55.9 per cent of agricultural labourers are poor, whereas in Punjab it is as high as 35.6 per cent.
In urban areas, casual labourers were the worst off with 47.1 per cent poor. The HCR of casual labour was the highest in Bihar (86 per cent), Assam (89 per cent), Orissa (58.8 per cent), Punjab (56.3 per cent), Uttar Pradesh (67.6 per cent) and West Bengal (53.7 per cent).
The Planning Commission's estimates of poverty are based on the methodology recommended by the Tendulkar Committee, which includes spending on health and education, besides calorie intake.

Planning Commission lowers the poverty line


The Planning Commission released the latest poverty estimates for the country showing a decline in the incidence of poverty by 7.3 per cent over the past five years and stating that anyone with a daily consumption expenditure of Rs. 28.35 and Rs. 22.42 in urban and rural areas respectively is above the poverty line.
The new poverty estimates for 2011-12 will only add to the furore triggered by the Commission's affidavit in the Supreme Court in October in which the BPL cap was pegged at an expenditure of Rs. 32 and Rs. 26 by an individual in the urban and rural areas respectively at the going rate of inflation in 2010-11.
Eventually, Union Minister of Rural Development Jairam Ramesh and Planning Commission Montek Singh Ahluwalia jointly set aside the cap suggested by the Tendulkar Committee and set up a new committee to work out a new methodology for identifying the BPL households. As per the Household Consumer Expenditure Survey for 2009-10, 29.9 per cent of the population alone were under the Below Poverty Line (BPL) from 37.2 per cent in 2004-05. 

Rural poverty

Rural poverty has declined by eight percentage points, from 41.8 per cent to 33.8 per cent, and urban poverty by 4.8 per cent, from 25.7 per cent to 20.9 per cent.
At the national level, anyone earning Rs. 672.8 monthly that is earning Rs. 22.42 per day in the rural area and Rs. 859.6 monthly or Rs. 28.35 per day in the urban area is above the poverty line. Population as on March 1, 2010 has been used for estimating the number of persons below the poverty line.
The total number of people below the poverty line in the country is 35.46 crore as against 40.72 crore in 2004-05. In rural areas, the number has come down from 32.58 crore five years ago to 27.82 crore and the urban BPL number stands at 7.64 crore as against 8.14 crore five years ago.
One of the most astonishing revelations is that poverty has actually gone up in the north-eastern States of Assam, Meghalaya, Manipur, Mizoram and Nagaland.
Even big States such as Bihar, Chhattisgarh and Uttar Pradesh registered only a marginal decline in poverty ratio, particularly in the rural areas, whereas States such as Himachal Pradesh, Madhya Pradesh, Maharashtra, Odisha, Sikkim, Tamil Nadu, Karnataka and Uttarakhand saw about 10 per cent decline in poverty over the past years.
States with high incidence of poverty are Bihar at (53.5 per cent), Chhattisgarh (48.7 per cent), Manipur (47.1 per cent), Jharkhand (39.1), Assam (37.9 per cent) and Uttar Pradesh (37.7 per cent).
However, it is in poverty-ridden Odisha that monthly per head expenditure of just Rs. 567.1 and Rs. 736 in rural and urban areas respectively puts one above the poverty line, while in Nagaland, where the incidence of poverty has gone up, the per capita consumption expenditure of Rs. 1016.8 and Rs. 1147.6 in rural and urban areas puts one above the poverty level.
Among social groups in the rural areas, Scheduled Tribes (47.4 per cent) suffer the highest level of poverty, followed by Scheduled Castes (42.3 per cent), Other Backward Castes (31.9 per cent) as against. 33.8 per cent for all classes.
In rural Bihar and Chhattisgarh, nearly two-third of the SCs and the STs are poor where as in States like Manipur, Orissa and Uttar Pradesh it is more than 50 per cent.
In urban areas, 34.1 per cent of SCs, 30.4 of STs and 24.3 per cent OBCs fall under this category against 20.9 per cent for all classes.

Monday, March 19, 2012

Poverty Estimates for 2009-10

The Tendulkar Committee for the first time recommended use of implicit prices derived from quantity and value data collected in household consumer expenditure surveys for computing and updating the poverty lines. Tendulkar Committee developed a methodology using implicit prices for estimating state wise poverty lines for the year 2004-05. Using these poverty lines and distribution of monthly per capita consumption expenditure based on mixed reference period (MRP), the Tendulkar Committee estimated poverty ratios for the year 2004-05.In its Report, Tendulkar Committee recommended a methodology for updating 2004-05 poverty lines derived by it.

         Accordingly, implicit price indices (Fisher Price Index) have been computed from the 66th Round NSS (2009-10) data on Household Consumer Expenditure Survey. As per Tendulkar Committee recommendations, the state wise urban poverty lines of 2004-05 are updated for 2009-10 based on price rise during this period using Fisher price indices. The state wise rural-urban price differential in 2009-10 has been applied on state specific urban poverty lines to get state specific rural poverty lines.

      The head count ratio (HCR) is obtained using urban and rural poverty lines which are applied on the MPCE distribution of the states. The aggregated BPL population of the states is used to obtain the final all-India HCR and poverty lines in rural and urban areas. Some of the key results are:

      The all-India HCR has declined by 7.3 percentage points from 37.2% in 2004-05 to 29.8% in 2009-10, with rural poverty declining by 8.0 percentage points from 41.8% to 33.8% and urban poverty declining by 4.8 percentage points from 25.7% to 20.9%.
       Poverty ratio in Himachal Pradesh, Madhya Pradesh, Maharashtra, Orissa, Sikkim, Tamil Nadu, Karnataka and Uttarakhand has declined by about 10 percentage points and more.
       In Assam, Meghalaya, Manipur, Mizoram and Nagaland, poverty in 2009-10 has increased.
      Some of the bigger states such as Bihar, Chhattisgarh and Uttar Pradesh have shown only marginal decline in poverty ratio, particularly in rural areas.

         Poverty ratio for Social Groups:
       In rural areas, Scheduled Tribes exhibit the highest level of poverty (47.4%), followed by Scheduled Castes (SCs), (42.3%), and Other Backward Castes (OBC), (31.9%), against 33.8% for all classes.
       In urban areas, SCs have HCR of 34.1% followed by STs (30.4%) and OBC (24.3%) against 20.9% for all classes.
       In rural Bihar and Chhattisgarh, nearly two-third of SCs and STs are poor, whereas in states such as Manipur, Orissa and Uttar Pradesh the poverty ratio for these groups is more than half.

         Among religious groups:
       Sikhs have lowest HCR in rural areas (11.9%) whereas in urban areas, Christians have the lowest proportion (12.9%) of poor.
       In rural areas, the HCR for Muslims is very high in states such as Assam (53.6%), Uttar Pradesh (44.4%), West Bengal (34.4%) and Gujarat (31.4%).
       In urban areas poverty ratio at all India level is highest for Muslims (33.9%). Similarly, for urban areas the poverty ratio is high for Muslims in states such as Rajasthan (29.5%), Uttar Pradesh (49.5%), Gujarat (42.4%), Bihar (56.5%) and West Bengal (34.9%).

         For occupational categories: 
       Nearly 50% of agricultural labourers and 40% of other labourers are below the poverty line in rural areas, whereas in urban areas, the poverty ratio for casual labourers is 47.1%.
       As expected, those in regular wage/ salaried employment have the lowest proportion of poor. In the agriculturally prosperous state of Haryana, 55.9% agricultural labourers are poor, whereas in Punjab it is 35.6%.
       The HCR of casual laborers in urban areas is very high in Bihar (86%), Assam (89%), Orissa (58.8%), Punjab (56.3%), Uttar Pradesh (67.6%) and West Bengal (53.7%).

         Based on the Education level of head of the household:
       In rural areas, as expected, households with ‘primary level and lower’ education have the highest poverty ratio, whereas the reverse is true for households with ‘secondary and higher’ education. Nearly two third households with ‘primary level & lower’ education in rural areas of Bihar and Chhattisgarh are poor, whereas it is 46.8% for UP and 47.5% for Orissa.
       The trend is similar in urban areas.

         For categories by age and sex of head of the household:
       In rural areas, it is seen that households headed by minors have poverty ratio of 16.7% and households headed by female and senior citizen have poverty ratio of 29.4% and 30.3% respectively.
       In urban areas, households headed by minors have poverty ratio of 15.7% and households headed by female and senior citizen have poverty ratio of 22.1% and 20.0% respectively against overall poverty ratio of 20.9%.

                  State wise details of poverty lines for 2009-10, poverty ratios for 2009-10 and poverty ratios for 2004-05 are given in Table 1, Table 2 and Table 3 respectively.

Unorganised Sector Labourers

According to the survey conducted by the National Sample Survey Organization (NSSO) in 2004-05, the total employment in both the organized and the unorganized sectors in the country was 45.9 crore, of which 43.3 crore (about 94%) were in the unorganized sector.  In Chhattisgarh State, the number of unorganised workers was 1.05 crore.

                 Recognizing the need to provide social security to unorganised workers, the Government has enacted the Unorganised Workers’ Social Security Act 2008. The Act provides for constitution of National Social Security Board at the Central level which shall recommend formulation of social security schemes viz  life and disability cover, health and maternity benefits, old age protection and any other benefit as may be determined by the Government for unorganized workers.  Similar Social Security Boards shall be constituted at the State Level also.
The Rashtriya Swasthya Bima Yojana (RSBY) was launched on 01.10.2007 to provide smart card based cashless health insurance cover of Rs. 30000 to BPL families ( a unit of five) in the unorganized sector. 

          The Government has launched the Aam Admi Bima Yojana (AABY) to provide insurance against death and disability to landless rural households.

       Indira Gandhi National Old Age Pension scheme (IGNOAPS) was expanded by revising the eligibility criteria. The persons living below poverty line and above the age of 60 year are eligible for old age pension of Rs. 200 per month.  For persons above the age of 80 years the amount of pension has been raised to Rs. 500 per month

        The States are provided part premium funding by the Central Government on the basis of number of smart cards issued. Hence, there is no State-wise allocation under Rashtriya Swasthya Bima Yojana (RSBY).  Under Aam Admi Bima Yojana (AABY), there is a corpus fund.  There is a combined allocation for National Social Assistance Programme of which IGNOAPS is a component.  The number of beneficiaries covered under RSBY, AABY and IGNOAP for the last three years are at Annexure-I .
                This information was given by Minister of Labour and Employment Shri   Mallikarjun Kharge  in reply in reply to a written question regarding the number of workers engaged in the unorganised sector in the country including Chhattisgarh; the number of welfare schemes implemented for the said workers during the last three years alongwith the budget allocation for each schemes during the said years; the utilisation of funds as against the Budget allocated for such schemes and the total number of beneficiaries therefrom, State-wise and year-wise; and the extent to which the interests of the workers of the unorganised sector are being protected.

Annexure-I
Number of smart cards issued under RSBY
S.No.
Name of the State/Union Territory
2009-2010

2010-11
2011-12 
(as on 29.02.2012)
1.    
Arunachal Pradesh
-
15711
39615
2.    
Assam
81565
       204465
      204548
3.    
Bihar
2038909
5101901
  7096914
4.    
Chandigarh
5407
4913
4913
5.    
Chhattisgarh
927672
1230378
1384680
6.    
Delhi
218055
113608
144518
7.    
Goa
3505
Discontinued the scheme 
8.    
Gujarat
682354
1919086
1850643
9.           
Haryana
682354
621741
584683
10.        
Himachal Pradesh
115828
237946
235131
11.        
Jharkhand
434762
1329254
9484
12.        
Karnataka
36971
157405
1060286
13.        
Kerala
1173388
1796315
1748471
14.        
Maharashtra
1440407
1516687
2172918
15.        
Manipur
-
18259
31921
16.        
Meghalaya
22579
59055
67150
17.        
Mizoram

15240
43256
18.        
Nagaland
39301
39290
77870
19.        
Orissa
341653
433079
1100793
20.        
Punjab
169306
193541
220486
21.        
Tamil Nadu
149520
Discontinued the scheme 
22.        
Tripura
145780
258402
258402
23.        
Uttar Pradesh
4296865
4233626
4145925
24.        
Uttarakhand
53940
335424
338879
25.        
West Bengal
802974
3527137
4486192

Total
13865338
23362463
27987800