GS Paper: GS3
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Pulses Production â Subramanian Committee, Eco Survey, etc.
Pulses are important source of protein, high in fibre content and provide ample quantity of vitamins and minerals. India having the largest shares about 25% production, about 33% acreage and about 27% consuming of total pulses of the world.
Although India is the highest producer of pulses in the world, its domestic demand outstrips domestic production. The shortfall is met from imports. In last 1 year prices of pulses have increased sharply which has made pulses unaffordable for the common man.
In this article We will explain why despite India being the largest producer of pulses, the price of pulses have increased so rapidly and we will also discuss steps taken by government in this regard and why those steps have not achieved intended results.
- What Factors caused increase in prices of pulses in recent years?
- Government steps in recent years to curb pulse prices
- Why government steps have failed to reduce prices?
- Will creating buffer stock for pulses would be able to curb pulses price?
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What factors caused increase in prices of pulses in recent years?
- Draught: Successive back to back drought i.e failure of crops in 3 successive seasons biggest reason for current price increase in pulses
- Low MSP: Low production of pulses due to Lower MSP prices for pulses in comparison to wheat and rice and even this low target for pulses procurement is not realized by the government, all these factors disincentives farmers towards pulse production.
- Grown in only Marginal Land: Since pulses could be grown in marginal land, a trend has developed in India where pulses are only grown in marginal and arid lands and mostly by small farmers, all this has led to low productivity for pulse crop. Only 15% of the 25 million hectares area sown annually for pulses in India is irrigated, compared to 60% for paddy and 90-95% for wheat and sugarcane
- Limited option of import: Option of import are limited in case of pulses since its production is restricted to few countries in Africa and Asia and even there due to lack of local demand, the production of pulses are low.
- Rise in demand: Rise in rural income due to MNREGA and better functioning of PDS has increased demand for protein rich food including pulses in last few years.
Steps taken by Government in recent years to curb pulse prices
- Banned exports and future trade in pulses.
- Created buffer stock for pulses
- Government has signed agreement with Mozambique under which India will encourage greater production of pulses in Mozambique with an assurance that it will be purchased by India at a mutually-agreed price.
- Allowed import of pulses at zero duty.
- Government has imported 50000 tonnes of pulses and also subsidized the domestic cost of transport, handling and milling through a price stabilization fund.
- Imposing essential commodities act and cracking down on hoarders and black marketer through imposition of stock holding limit.
- Government has increased MSP price of 2 pulse crops i.e. Arhar and masur by Rs 250 per quintal.
- Inclusion of cluster demonstrations in rice fallows for pulses cultivation in rabi season from 2015-16 under BGREI (Bringing Green Revolution in Eastern India) scheme in order to increase production of pulses in Eastern India in states of Assam, Bihar, Chhattisgarh, Jharkhand, Odisha, Eastern U.P. and West Bengal
- A special programme for demonstration of new varieties of pulses through Krishi Vigyan Kendra (KVKs) has been taken up from Rabi 2015-16 in order to increase availability of seeds of new varieties of pulses and promote adoption of new varieties
Why government steps failed to reduce prices?
- Firstly steps taken against stockers are discouraging them to further invest in warehouses and cold storage. In the absence of stockiest, market prices of pulses collapse, discouraging farmers from growing them in current season.
- Secondly by suspending future and forward market in pulses, the government has simply shot the messenger. Forward and future market give signal about likely future prices and if harnessed they could actually help the government take preventive measures.
- Thirdly government imported just 7000 tonnes to tame prices, whereas overall consumption is 3.3 to 4 million tones.
- Fourthly the government announced MSP norms in November 2015 , which had a limited impact on Pulse production in 2016, since by that time farmers had already made decision regarding which crop they will sow in rabi season.
Will creating buffer stock for pulses help curb the rising pulses price?
- Creation of buffer stock of 150000 tonnes from both domestic production and imports could reduce fluctuations in prices as the accumulated reserve could be released in market whenever price of pulses spikes
- It could also increase production of pulses, since The Food Corporation of India, National Agricultural Cooperative Marketing Federation of India, Small Farmersâ Agribusiness Consortium and other agencies would be engaged in purchasing the crop from farmers.
- The payment for these purchases would be made from the price stabilisation fund created by the government. This will encourage farmers to take up pulses production on a larger scale and will enable India to help achieve self-sufficiency in pulses in a few years
- However buffer stock alone would not be able to curtail price in the long run, alongside this step the government has to take number of other steps which include
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The Way forward?
- Create a crop-neutral incentive structure for farmers, which at present are skewed in favour of rice, wheat & sugarcane. This could be done by rapidly increasing MSP for pulses in next few years.
- Greater public investment in providing irrigation facilities in areas under pulse production could increase productivity of pulses
- Augment seed availability of pulses
- More allocation should be done on scientific research related to pulses varieties so that better varieties of pulses could be developed
References:
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Start-up Ecosystem In India
START-UP India Launch by Prime Minister Modi on 16th January, 2016, aimed at celebrating the entrepreneurship spirit of countryâs youth and has been attended by CEOs and founders of top startups (over 1500) from across the country. Let’s see this in brief!
<In Part I, we have taken a glance on Simplification and Handholding of Start up Plan, rest part will be covered in Part II of this series>
What is Start up India programme and its mandates?
- Startup India is a flagship initiative, intended to build a strong ecosystem for nurturing innovation and Startups in the country that will drive sustainable economic growth and generate large scale employment opportunities.
- In order to meet the objectives of the initiative, Government of India is announcing this Action Plan that addresses all aspects of the Startup ecosystem.
How can this Action Plan help accelerate the Startup movement?
- It is spread across movement from digital/ technology sector to a wide array of sectors including agriculture, manufacturing, social sector, healthcare, education, etc.
- From existing tier 1 cities to tier 2 and tier 3 cities including semi-urban and rural areas.
The Action Plan is divided across the following areas:
- Simplification and Handholding
- Funding Support and Incentives
- Industry-Academia Partnership and Incubation
What is the exact definition of a Startup ?
- Startup means an entity, incorporated or registered in India not prior to 5 years, with annual turnover not exceeding INR 25 crore in any preceding financial year.
- Provided that such entity is not formed by splitting up, or reconstruction, of a business already in existence.
What will be the Action plan for Simplification and Handholding task?
#Compliance Regime based on Self-Certification
- To reduce the regulatory burden on Startups thereby allowing them to focus on their core business and keep compliance cost low.
- Startups shall be allowed to self-certify compliance (through the Startup mobile app) with 9 labour and environment laws (refer below).
- In case of the labour laws, no inspections will be conducted for a period of 3 years.
- In case of environment laws, Startups which fall under the âwhite categoryâ (as defined by the Central Pollution Control Board (CPCB)) would be able to self-certify compliance and only random checks would be carried out in such cases. [Can you think of question on white category in Prelims?]
#Startup India Hub
To create a single point of contact for the entire Startup ecosystem and enable knowledge exchange and access to funding.
How will âStartup India Hubâ be a key stakeholder in this vibrant ecosystem?
- Work in a hub and spoke model and collaborate with Central & State governments, Indian and foreign VCs, angel networks, banks, incubators, legal partners, consultants, universities and R&D institutions.
- To all young Indians who have the courage to enter an environment of risk, the Startup India Hub will be their friend, mentor and guide to hold their hand and walk with them through this journey.
#Legal Support and Fast-tracking Patent Examination at Lower Costs
- To promote awareness and adoption of IPRs by Startups and facilitate them in protecting and commercializing the IPRs.
- By providing access to high quality Intellectual Property services and resources, including fast-track examination of patent applications and rebate in fees.
- The scheme for Startup Intellectual Property Protection (SIPP) shall facilitate filing of Patents, Trademarks and Designs by innovative Startups.
Various measures being taken in this regard include:
#1. Fast-tracking of Startup patent applications:
Patent application of Startups shall be fast-tracked for examination and disposal, so that they can realize the value of their IPRs at the earliest possible.
#2. Panel of facilitators to assist in filing of IP applications:
Facilitators will be responsible for providing general advisory on different IPRs as also information on protecting and promoting IPRs in other countries.
#3. Rebate on filing of application:
Startups shall be provided an 80% rebate in filing of patents vis-a-vis other companies. This will help them pare costs in the crucial formative years.
#Relaxed Norms of Public Procurement for Startups
- At present, effective April 1, 2015 Central Government, State Government and PSUs have to mandatorily procure at least 20% from the Micro Small and Medium Enterprise (MSME).
- In order to promote Startups, Government shall exempt Startups (in the manufacturing sector) from the criteria of âprior experience/ turnoverâ without any relaxation in quality standards or technical parameters.
#Faster Exit for Startups
- To make it easier for Startups to wind up operations.
- The Insolvency and Bankruptcy Bill 2015 (âIBBâ), tabled in the Lok Sabha in December 2015 has provisions for the fast track and / or voluntary closure of businesses.
- In terms of the IBB, Startups with simple debt structures or those meeting such criteria as may be specified may be wound up within a period of 90 days from making of an application for winding up on a fast track basis.
Let us know what do you think on this question?
#Q. How will start ups create an ecosystem that can flourish with âDigital Indiaâ initiative? Discuss with examples.
Published with inputs from Arun
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Roads, Highways, Cargo, Air-Cargo and Logistics infrastructure â Bharatmala, LEEP, SetuBharatam, etc.
Challenges, opportunities & criticism of the Real Estate Regulatory Bill 2016
The Real Estate Regulatory Bill, 2016 is being hailed as a much-needed step to reform the real estate sector. It will help regulate the sector and bring in clarity for both buyers and developers.
What was the need for regulation in the real estate?
- The real estate sector has some issues such as a lengthy process for project approvals, lack of clear land titles, and prevalence of black money
- There wasn’t complete transparency as far as govt approvals were concerned
- There were also instances when projects were sold without adequate clearances
- The delayed projects, sometimes by up to 6Â years and arbitrary changes in layout plans are rampant in the sector
How does the Bill seeks to regulate the sector?
The basic thrust of this Bill is to regulate the delivery of projects to home buyers. It provides them a legal safeguard for their investment, and seeks to address timely delivery of houses. It seeks to enforce the contract between the developer and buyer and act as a fast track mechanism to settle disputes
- It establishes state level regulatory authorities called Real Estate Regulatory Authorities (RERA)
- The Bill establishes state level tribunals called Real Estate Appellate Tribunals. Decisions of RERAs can be appealed in these tribunals
- It makes mandatory the disclosure of all information for registered projects like details of promoters, layout plan, land status, schedule of execution and status of various approvals
- The Bill prohibits a developer from changing the plan in a project unless two-thirds of the allottees have agreed for such a change
- It says that builders must specify the time-frame for completion of projects and stick to it, or be ready to pay penalties
- The Bill mandates that 70% of the amount collected from buyers of a project be used only for construction of that project <Â This provision will effectively allow developers to continue their practice of diverting funds collected for a project towards land acquisition or other projects, and will work in their favour by also allowing them to grow their land and/or project portfolio>
How will the Real Estate Regulatory Authorities help improve the sector?
- Residential real estate projects need to be registered with RERAs, except few
- Promoters cannot book or offer these projects for sale without registering them
- Real estate agents dealing in these projects also need to register with RERAs
- On registration, the promoter need to provide details of the project to the RERA
Challenges ahead
- The Bill will make life difficult for builders, as they would face more red-tapeism now, especially in procuring relevant approvals.
- This Bill does not address the developers demand of a single-window clearance from the govt
- The implementation of the Bill is up to the states, it leaves builders with greater chances of being harassed
Impact
- Timely completion of projects would lead to a steady increase in supply of homes
- It is expected that these measures will eventually bring down home prices and increase demand
- It will be good for the overall economy too, as the housing sector has strong backward (cement, steel and other building material industries) and forward (furniture and furnishings, interior decoration, electrical and electronics) linkages with other industries
- More number of job creation in the economy
Criticism
- The builder lobbies argued that the bill should have a time-frame for municipal and other authorities to give timely approvals, because the delay in approvals lead to delays in handing over possession of apartments
- In terms of pricing, which is governed by circle rates, it will be difficult to monitor
Future
- The states’ support for faster clearances to projects will be required to make this Bill successful
- Govt is also trying to bring in a National Urban Rental Housing Policy, which would take into account the requirements of tenancy hassles in modern days
Published with inputs from Pushpendra
Sagarmala Project: Smart ports for Blue Revolution in India
The Union Cabinet chaired by the Prime Minister Modi, on March,2015 gave its âin-principleâ approval for the concept and institutional framework of Sagarmala Project. Let’s take a glance on it.
What’s the prime objective of Sagarmala?
The prime objective of the Sagarmala project is to promote port-led direct and indirect development and to provide infrastructure to transport goods to and from ports quickly, efficiently and cost-effectively.
What’s the current issue and background of ports in India?
- At present there are around 200 ports (small and big) in the country, of these, only 12 are major ports which are government owned ports, which handle about 58% of sea-borne traffic.
- These major ports operate as Trusts under the Major Ports Trust Act, 1963, except for the Port of Ennore, which is a company under the Companies Act.
- There are legacy issues with these govt owned major ports, they do not keep pace with emerging technology, requirements of international trade, emerging trends in containerisation, flexible rules, size of ships etc.
Which are the 12 Major Ports ?
These are Kolkata (including Dock Complex at Haldia), Visakhapatnam, Chennai, V.O. Chidambaranar (Tuticorin), Cochin, New Mangalore, Mormugao, Jawaharlal Nehru Port Trust (JNPT), Mumbai, Kandla and Ennore.
Just, Look back into the history?
In 2003, then PM Vajpayee proposed Project Sagarmala with following features:
- Setup Sagarmala Development Authority (Similar to National highway authority of India).
- It will get money via Maritime development cess. (5 paise per kg on cargo).
- It will improve ports, shipping industry, inland water transport, coastal shipping.
- PPP and FDI to gather more investment.
Then, which are the Key pillars to achieve Smart-development ?
- Supporting and enabling Port-led Development through appropriate policy and institutional interventions.
- Providing for an institutional framework for ensuring inter-agency and statesâ collaboration for integrated development.
- Port Infrastructure Enhancement, including modernization and setting up of new ports.
- Efficient Evacuation to and from hinterland.
What are some of the measures to make Smart Ports?
- Ports should be registered as Companies under Companies Act.
- The port administration should only look after the provisions of infrastructure and safety and not day-to-day running of the port
- There is still no regulation to control the trade practices.
- Hence, there is a dire need to introduce a regulatory architecture that takes care of ex-ante declaration of rates of services.
Then, what’s the plan to implement such a vast initiative?
- For a comprehensive and integrated planning for âSagarmalaâ, a National Perspective Plan (NPP) for the entire coastline shall be prepared within six months.
- It will identify potential geographical regions to be called Coastal Economic Zones (CEZ).
- While preparing the NPP, synergy and integration with planned Industrial Corridors, Dedicated Freight Corridors, National Highway Development Programme, Industrial Clusters and SEZs would be ensured.
What are the suggestions for effective mechanism at state level?
- Set up State Sagarmala Committee to be headed by CM / Minister in Charge of Ports.
- Sagarmala Coordination and Steering Committee (SCSC) shall be constituted under the chairmanship of the Cabinet Secretary and others.
- This Committee will provide coordination between ministries, state governments and agencies connected with implementation and review the progress of implementation of the National Perspective Plan.
How does it ensure the sustainable development in CEZ?
- This would be done by synergising and coordinating with State Governments and line Ministries of Central Government through their existing programmes.
- Such as those related to community and rural development, tribal development and employment generation, fisheries, skill development, tourism promotion etc.
- In order to provide funding for such projects and activities that may be covered by departmental schemes a separate fund by the name âCommunity Development Fundâ would be created.
What’s the role of Institutional Framework ?
- It has to provide for a coordinating role for the Central Government.
- It should provide a platform for central, state governments and local authorities to work in tandem and coordination under the established principles of cooperative federalism.
What’s the role of NSAC?
A National Sagarmala Apex Committee (NSAC) is envisaged for overall policy guidance and high level coordination, and to review various aspects of planning and implementation of the plan and projects.
So, Is it Good to have smart ports on the line of Smart Cities?
Can you answer some questions?
#1. Can you examine the bottlenecks in Indian port infrastructure and list the initiative taken in recent times to address this issue?
#Q.2 Indian port infrastructure can be revamped by Sagarmala project by effective management? critically comment.
Published with inputs from Arun