NITI Aayog’s Assessment

NITI Aayog’s Assessment

Extra Neutral Alcohol (ENA)Prelims Only


From UPSC perspective, the following things are important :

Prelims level : Extra Neutral Alcohol (ENA)

Mains level : Not Much

Alcohol manufacturers citing a shortage of domestic supplies have sought a reduction in import duty of Extra Neutral Alcohol to make it cost-effective for them to import from global markets.

Extra Neutral Alcohol (ENA)

  • Like ethanol, ENA is a byproduct of the sugar industry and is formed from molasses that are a residue of sugarcane processing.
  • It is the primary raw material for making alcoholic beverages.
  • It is colourless food-grade alcohol that does not have any impurities.
  • It has a neutral smell and taste and typically contains over 95 per cent alcohol by volume.
  • It is derived from different sources — sugarcane molasses and grains — and is used in the production of alcoholic beverages such as whisky, vodka, gin, cane, liqueurs, and alcoholic fruit beverages.

Uses of ENA

  • ENA also serves as an essential ingredient in the manufacture of cosmetics and personal care products such as perfumes, toiletries, hair spray, etc.
  • Given its properties as a good solvent, ENA also finds industrial use and is utilized in the production of some lacquers, paints and ink for the printing industry, as well as in pharmaceutical products such as antiseptics, drugs, syrups, medicated sprays.
  • Consultancy firm IMARC Group’s estimates put the ENA market in India at a volume of 2.9 billion litres in 2018.
NITI Aayog’s Assessment

[op-ed snap] Reimagining the NITI AayogMains Onlyop-ed snap


From UPSC perspective, the following things are important :

Prelims level : Nothing Much

Mains level : New vision for Niti Ayog


India’s Constitution-makers thought of India as a union of States with a centripetal bias, done, advisedly, to preserve the unity and integrity of a newly fledged nation.

Change in situation

  • Since then, the Indian economy, polity, demography and society have undergone many changes. The new aspirational India is now firmly on a growth turnpike. It is in this context that we revisit India’s fiscal federalism and propose redesigning it around its four pillars.
  • Challenges before federations
  • Typically, federations (including the Indian one) face vertical and horizontal imbalances.

Vertical imbalance

A vertical imbalance arises because the tax systems are designed in a manner that yields much greater tax revenues to the Central government when compared to the State or provincial governments; the Constitution mandates relatively greater responsibilities to the State governments. For example, in India, post the advent of Goods and Services Tax (GST), the share of States in the public expenditure is 60% while it is 40% for the Centre to perform their constitutionally mandated duties.

Horizontal imbalances

  • The horizontal imbalances arise because of differing levels of attainment by the States due to differential growth rates and their developmental status in terms of the state of social or infrastructure capital.
  • Traditionally, Finance Commissions have dealt with these imbalances in a stellar manner, and they should continue to be the first pillar of the new fiscal federal structure of India.

Understanding the imbalance

  • However, in India, the phenomenon of horizontal imbalance needs to be understood in a more nuanced fashion.
  • It involves two types of imbalances. Type I is to do with the adequate provision of basic public goods and services, while the second, Type II, is due to growth accelerating infrastructure or the transformational capital deficits.
  • It is here that we believe that NITI Aayog 2.0 must create a niche, assume the role of another policy instrument and become the second pillar of the new fiscal federal structure.
  • It is best that the Union Finance Commission be confined to focussing on the removal of the horizontal imbalance across States of the Type I: i.e. the basic public goods imbalance.
  • We need another institution to tackle the horizontal imbalance of the Type II; for this the NITI Aayog is the most appropriate institution.

Tasks for Niti Ayog

  •  NITI Aayog 2.0 should receive significant resources (say 1% to 2% of the GDP) to promote accelerated growth in States that are lagging, and overcome their historically conditioned infrastructure deficit, thus reducing the developmental imbalance.
  • NITI Aayog 2.0 should also be mandated to create an independent evaluation office which will monitor and evaluate the efficacy of the utilisation of such grants. 

Ushering in decentralisation

  • The same perspective will have to be translated below the States to the third tier of government.
  • This is crucial because intra-State regional imbalances are likely to be of even greater import than inter-State ones.
  • Decentralisation, in letter and spirit, has to be the third pillar of the new fiscal federal architecture.
  • De jure and de facto seriousness has to be accorded to the 73rd and 74th constitutional amendments.
  • One of the ways for this is through the creation of an urban local body/panchayati raj institutions consolidated fund.
  • This would mean that Articles 266/268/243H/243X of our Constitution will need to be amended to ensure that relevant monies directly flow into this consolidated fund of the third tier.
  • Further, the State Finance Commissions should be accorded the same status as the Finance Commission and the 3Fs of democratic decentralisation (funds, functions and functionaries) vigorously implemented. This will strengthen and deepen our foundational democratic framework.

Fine-tuning the GST

  • The fourth pillar — and in a sense what is central and binding — is the “flawless” or model GST.
  • We need to quickly achieve the goal of a single rate GST with suitable surcharges on “sin goods,” zero rating of exports and reforming the Integrated Goods and Services Tax (IGST) and the e-way bill.
  • The GST Council should adopt transparency in its working, and create its own secretariat with independent experts also as its staff.
  • This will enable it to undertake further reforms in an informed and transparent manner. Thus, India will be able to truly actualise the “grand bargain” and see the GST as an enduring glue holding the four pillars together by creating the new fiscal federal architecture and strengthening India’s unique cooperative federalism.
NITI Aayog’s Assessment

[op-ed snap] Is NITI Aayog old wine in a new bottle?Mains Onlyop-ed snap


From UPSC perspective, the following things are important :

Prelims level : nothing much

Mains level : Need of reforms in Niti Ayog


There must be a review of what the think tank has achieved to adopt the new role described in its charter

Under scrutiny

Now, when the country’s economy has not performed to the high expectations Mr. Modi had created, and citizens’ aspirations for ‘ache din’ have not been realised, the performance of the NITI Aayog is under scrutiny, as it should be.

History of reforms

Dr. Singh declared that reform of the Planning Commission was long overdue.

Planning Commission Reforms

  • An outline was drawn of a substantially reformed institution which would, in Dr. Singh’s words, have a capability for “systems reform” rather than making of Five-Year Plans, and which would have the “power of persuasion” without providing budgets.
  • A commission chaired by C. Rangarajan, then chief economic adviser to the Prime Minister, examined budgetary processes, divisions of responsibilities between the Finance Ministry and the Planning Commission, and distinctions between ‘plan’ and ‘non-plan’ expenditures.
  • Chief Ministers retorted that the Planning Commission must improve its ability to understand their needs and to develop ideas that they would want to adopt because they accepted the ideas as good for them, not because they would have to if they wanted the money.

A good starting point

  • The NITI Aayog charter is a good starting point for a new journey in transforming the governance of the Indian economy.
  • The NITI Aayog and the government would do well to conduct an open-minded review of what NITI Aayog has achieved so far to adopt the new role described in its charter — that of a catalyst of change in a complex, federal, socioeconomic system.
  • And assess whether it has transformed its capabilities sufficiently to become an effective systems reformer and persuader of stakeholders, rather than merely an announcer of lofty multi-year goals and manager of projects, which many suspect it is.

Concerns regarding independence

  • There is deep concern that NITI Aayog has lost its integrity as an independent institution to guide the government; that it has become a mouthpiece of the government and an implementer of the government’s projects.
  • Many insist that NITI Aayog must have the ability to independently evaluate the government’s programmes at the Centre and in the States.
  • Some recall that an Independent Evaluation Office set up in the last days of the UPA-II government was swiftly closed by the NDA government.
  • Others counter that the Planning Commission had a Programme Evaluation Organisation all along and which continues. They miss the need for a fundamental transformation in the approach to planning and change.

Way Forward

  • The transformational approach to planning and implementation that 21st century India needs, which is alluded to in NITI’s charter, requires evaluations and course-corrections in the midst of action.
  • It requires new methods to speed up ‘organisational learning’ amongst stakeholders in the system who must make plans together and implement them together.
  • The NITI Aayog’s charter has provided a new bottle.
  • It points to the need for new methods of cooperative learning and cooperative implementation by stakeholders, who are not controlled by any central body of technical experts with political and/or budgetary authority over them.


Merely filling this new bottle with old ideas of budgets, controls and expert solutions from above will not transform India. The debate about NITI Aayog’s efficacy must focus on whether or not it is performing the new role it must, and what progress it has made in acquiring capabilities to perform this role, rather than slipping back into the ruts of yesterday’s debates about the need for a Planning Commission.

NITI Aayog’s Assessment

[op-ed snap] The state of the Statesop-ed snap


Mains Paper 3: Economic Development | Inclusive growth and issues arising from it.

From UPSC perspective, the following things are important:

Prelims level: Basic knowledge of Sustainable Development Goals.

Mains level: The news-card analyses the recently released NITI Aayog’s SDG India Index: Baseline Report 2018, in a brief manner.


  • Recently NITI Aayog released the SDG India Index: Baseline Report 2018.


  • India was one among the 193 United Nations member states to adopt the Sustainable Development Goals (SDGs) in September 2015.
  • It has been making sincere efforts to achieve these goals.

SDG India Index: Baseline Report 2018

  • The report is a useful comparative account of how well different States and Union Territories have performed so far in their efforts to achieve these goals.
  • However, it has not been possible to establish suitable indicators for three of the 17 goals, including climate action (SDG-13).
  • This is on account of either lack of identification of appropriate indicators or of the inability to compare different States.
  • On the whole, 62 indicators representing 14 goals have been identified based on their measurability across States over time.
  • A progress performance assessment has been made towards targets set by the Government of India, or the UN SDGs target for 2030, or the average of the three best-performing States.
  • For reasons of comparability, all these indicators are normalised.

States are categorised into four groups

  • Based on a scale of 0 to 100, the States are categorised into four groups: achievers, front runners, performers, and aspirants.
  • Achievers are those States which have already accomplished the set target.
  • Front runners are those States that are very close to realising them.
  • A majority of the States are categorised as performers and some lag behind as aspirants.

Arbitrariness in the exercise

  • Although classification sounds like an appropriate thing to do, there is arbitrariness in the exercise.
  • In a unitary range, those States with scores till the midpoint are categorised as aspirants and a cluster of States in a close range of progress are termed as performers.
  • A few States are designated as front runners.
  • The three front runner States — Tamil Nadu, Kerala, and Himachal Pradesh — assume values of 66, 69 and 69, respectively, as against a range of States with values between 50 and 64.
  • With the national score being 57, almost 17 States qualify as above or equal to the national score.
  • Plotted on a graph, there is a negatively skewed distribution of scores.
  • This needs to be recognised in classification; otherwise the arbitrariness with which the classification is made somewhat hints at a purposive designation of a few States in two extremes and a major share of them in between.

The problem of averaging

  • Further, when one reads into the performance on various SDGs, it is found that many States fall into the aspirant category, especially for SDG-5 (gender equality), SDG-9 (industry innovation and infrastructure) and SDG-11 (sustainable cities and communities).
  • These kinds of differences could well be emerging owing to a different number of indicators considered under different SDGs as well as their corresponding variability across the States.
  • This is evident in the variation of scores across different goals.
  • For instance, in case of goals 1 and 2, the range for the majority of the States is between 35 and 80.
  • For goals 3 and 6, the range is between 25 and 100.
  • Again, for goal 5, it ranges between 24 and 50.
  • Given these variations across different goals, merely averaging them not only compromises on robustness but also masks the disaggregated story to a large extent.

Difference between two states doesn’t give a clear picture

  • The difference in progress between the three front runner States is three points.
  • This is perhaps not similar to the distance between the performing States of Telangana and Andhra Pradesh, which too have a three-point difference.
  • Such comprehension of achievement is limited as regards to comparing States, let alone designating them into four categories.

Way Forward: What can be done?

  • Finally, the process of aggregation adopted to present the summary index of compliance with the targets being a simple average assumes that each of the goals as well as the corresponding set of indicators are equally important and can substitute for each other.
  • This also overlooks the aspect of inter-dependence of various goals, although it is upfront stated in the exercise.
  • To ensure minimum robustness of this measure, a geometric average would have served towards avoiding perfect substitutability of one goal with the other.
  • While this exercise serves as a report card of performance of States as regards compliance with the SDGs, its scientific adequacy is compromised with arbitrariness that presents a stereotypical pattern of performance rather than bringing out surprises.
  • The choice of indicators representing specific goals need not necessarily be guided by availability but also their explicit independence from one another.
  • This may help in making a uniform set of indicators for each of the goals with proper representation without duplication.


  • On the whole, this performance assessment may not be misleading, but it does not help us understand the relative significance of compliance in some goals that helps in compliance of the other.
  • Thus, performance assessment of SDGs while overlooking the strict interdependence of them may not be rewarding.
NITI Aayog’s Assessment

Ex-finance panel chief Kelkar for setting up ‘Niti Aayog 2.0’


Mains Paper 3: Economy | Indian Economy Issues relating to planning

From the UPSC perspective, the following things are important:

Prelims level: Not Much

Mains level: Analysing effectiveness of the erstwhile NITI Aayog and Planning Commission


  • Former Finance Commission chairman Vijay Kelkar has pitched for setting up of a ‘new NITI Aayog’ and giving it responsibility for allocating capital and revenue grants to the states.

Towards India’s New Fiscal Federalism

  1. Kelkar, in his paper said it is desirable that a functionally distinct entity such as the new Niti Aayog be put to use to do the job at hand related to the structural issues.
  2. It should function for removal of regional imbalances in the economy.
  3. However he did not suggested that the later to take the form of the old Planning Commission.
  4. Socialist-era Planning Commission was replaced by think-tank Niti Aayog on January 1, 2015, by the Modi government.

NITI Aayog isn’t effective?

  1. Kelkar argued that replacing the Planning Commission, which was promoting regionally balanced growth in India, by the Niti Aayog, a think tank, has reduced the government’s policy reach.
  2. This would mean that the new Niti Aayog or Niti Aayog 2.0 will be responsible for allocating development or transformational capital or revenue grants to the states.
  3. Kelkar also suggested that in order to make the new Niti Aayog more effective, it is essential to ensure that the institution is at the ‘High Table’ of decision making of the government.
  4. This means the vice-chairman of the new Niti Aayog will need to be a permanent invitee of the Cabinet Committee on Economic Affairs (CCEA).
  5. Thus, the new Niti Aayog will make available to the highest level of policy making the knowledge-based advice and provide the national and long term perspective on the policy proposals.

Need for Financial Autonomy

  1. India has consistently accelerated its growth rate over the last three decades.
  2. India’s democracy has proved to be sine qua non for effectively formulating key economic policies and conducting policy reforms in a country that is so diverse.
  3. Kelkar pointed out that the new Niti Aayog will annually need the resources of around 1.5 to 2 per cent of the GDP to provide suitable grants to the states for mitigating the development imbalances.


NITI Aayog

NITI Aayog (National Institution for Transforming India)

NITI Aayog’s Assessment

[op-ed snap] This is not the future we wantop-ed snap


Mains Paper 3: Environment | Conservation, environmental pollution and degradation, environmental impact assessment.

From UPSC perspective, the following things are important:

Prelims level: Basic knowledge of the NITI Aayog recently released ‘Strategy for New India @ 75’.

Mains level: The news-card analyses many environment and livelihood related contradictions in NITI Aayog’s strategy for 2022, in a brief manner.


  • NITI Aayog recently released the ‘Strategy for New India @ 75’ document in 2018.
  • The strategy aims to achieve a ‘New India’ by 2022, when the country celebrates its 75th year of Independence.

About the Plan

  • The NITI Aayog’s‘Strategy for New India @ 75’ document has many progressive objectives.
  • It follows the UN Sustainable Development Goals.
  • Inclusion, sustainability, participation, gender equality and other important issues find mention.
  • However, NITI Aayog’s strategy for 2022 is replete with environmental and livelihood related contradictions.

Positive directions vis-à-vis the environment

The strategy has many positive directions vis-à-vis the environment, such as:

  • A major focus on renewable energy.
  • Organic farming (with the zero budget natural farming model developed by Maharashtrian farmer Subhash Palekar being singled out for national application).
  • Increasing forest cover.
  • Reducing pollution and waste.
  • A chapter titled ‘Sustainable environment’ states: “The objective is to maintain a clean, green and healthy environment with peoples’ participation to support higher and inclusive economic growth through sustainable utilization of available natural resources.”
  • It focuses on air pollution, solid waste management, water pollution, and forestry.

Limitations: Many missing issues

  • However, it is puzzling why these above mentioned four issues are singled out from amongst the much larger number of environmental issues India faces.
  • Some other issues do find mention elsewhere, such as arresting land degradation and soil erosion, and water conservation.
  • But many are missing, such as the urgent need to conserve a range of non-forest ecosystems.
  • Since colonial times, forests have remained predominant in the minds of decision-makers, as indicated by the fact that India still has only a Forest Department and no dedicated entity for grassland, marine and coastal, wetland, mountain, and desert conservation.
  • The increasing presence of toxic chemicals around us finds no mention.
  • Most importantly, the absence of an integrated, comprehensive view on how ecological issues can be integrated into all sectors indicates that this is still not core to the mindset of our planners.

Current form of Economic growth is un-sustainable

  • There is total absence of an understanding in the document that the current form and goal of economic growth is inherently unsustainable.
  • For more than three decades, governments have been promising that with environmental safeguards, growth can be made sustainable.
  • There is no indication that this is anywhere near achievable, much less achieved.
  • In 2008, the Confederation of Indian Industry indicated that India was already using twice of what its natural resources could sustain, and that more than half its biocapacity had already been eroded.

Contradictions in the document: Few Alarming features

(a) Proposal of doubling of the extent of mining

  • One of the biggest ecological and social disasters in India is mining, especially the large-scale open-cast type.
  • NITI Aayog ignores this when it proposes a doubling of the extent of mining.
  • The only concession is the suggestion to bring in “cutting-edge” technology to “limit environmental damage” but that will not solve the fundamental need to deforest areas.

(b) Tourism

  • Another major sector with horrendous environmental impacts is tourism, as witnessed by virtually all our groaning hill stations and the ruin that areas like Ladakh, Kutch and the island regions are facing.
  • Yet, NITI Aayog recommends doubling the number of domestic tourist visits to over 3,200 million from 1,614 million in 2016.

(c) Mega river valley projects

  • The document also urges prompt completion of a host of mega river valley projects that have proved to be ecological nightmares, including Pancheshwar in the fragile Himalaya, the Ken-Betwa link in Madhya Pradesh, and dozens in the Northeast that are going to choke up rivers and are being pushed ahead despite strong local opposition.

(d) Farming

  • While mentioning of organic farming, there is no clear direction to phase out chemical fertilizers and pesticides.
  • The objective of sustainable farming is undermined by the mention of the following: “Phase out old varieties of seeds and replace them with hybrid and improved seeds”.
  • This is the kind of Green Revolution approach that has caused huge loss of agricultural biodiversity and resilience amongst small farmers.
  • There is also no focus on dryland farming though most farmers are engaged in this.
  • There is positive mention of organic farming models for replication, but nothing on the amazing work of dryland farmers (such as the Dalit women of the Deccan Development Society in Telangana) showing productive, sustainable, biodiverse agriculture with millets and women as the fulcrum.

(d) Single-window clearance of infrastructure projects

  • One of the most alarming features of the document is its stress on rapid, single-window clearance of infrastructure and other projects.
  • Any decent ecological assessment of a project needs a year of study (over all seasons), so the 180 days limit it suggests will mean short-cuts.
  • This rush also means compromising on crucial processes of social assessment, public hearings, and participatory decision-making, as already seen in the last few years.
  • There is nothing on the need to seek consent from local communities, though this is mandated under the Forest Rights Act, 2006, and the Panchayat (Extension to Scheduled Areas) Act, 1996.

Way Forward

  • Governments in the last few years have a dismal record of safeguarding the environment and the livelihoods of Adivasis and other communities.
  • They have found ways to bypass constitutional and policy safeguards these vulnerable sections are supposed to enjoy.
  • Without a strong, unambiguous commitment to upholding these protections, and putting communities at the centre of decision-making, India @ 75 is going to be an even more unequal, unjust, and conflict-ridden society than India @ 50.
  • This is not the future we want.Instead, we can learn from the many alternative initiatives for food, water, energy, housing, education and health existing across India, which show the way to more just and sustainable livelihoods and ways of living.
NITI Aayog’s Assessment

[op-ed snap] The shape of growth mattersop-ed snap


Mains Paper 3: Economy | Indian Economy Issues relating to planning

From the UPSC perspective, the following things are important:

Prelims level: Strategy for New India @ 75

Mains level: Measuring India’s growth till date and formulating future plans according to the changing dynamics


NITI Aayog’s new development plan

  1. NITI Aayog recently released its ‘Strategy for New India @ 75’
  2. The strategy affirms that “policymaking will have to be rooted in ground realities” rather than economic abstractions
  3. The intent to change the approach to planning from preparations of plans and budgets to the creation of a mass movement for development in which “every Indian recognises her role and experiences the tangible benefits” is laudable
  4. The strategy emphasises the need to improve the implementation of policies and service delivery on the ground, which is what matters to citizens
  5. Its resurrection of the 15 reports of the Second Administrative Reforms Commission and recommendation that they must be implemented vigorously are welcome

Focus on employment led growth

  1. Employment and labour reforms, the second chapter in the strategy, have rightly been given the highest priority, which was not the case in the previous plans
  2. Overall growth is also emphasised by NITI Aayog: “Besides having rapid growth, which reaches 9-10 per cent by 2022-23, it is also necessary to ensure that growth is inclusive, sustained, clean and formalised
  3. The employment-generating capacity of the economy is what matters more to citizens than the overall GDP growth rate
  4. There is no joy for citizens if India is the fastest-growing economy and yet does not provide jobs and incomes
  5. The growth of industry and manufacturing is essential to create more employment, and to provide bigger opportunities to Indians who have been too dependent on agriculture so far
  6. Here, too, it is not the size of the manufacturing sector that matters but its shape. Labour-intensive industries are required for job creation
  7. If the manufacturing sector is to grow from 16% to 25% of the GDP, which the strategy states as the goal, with more capital-intensive industries, it will not solve the employment problem
  8. The strategy does say that labour-intensive industries must be promoted, but the overall goal remains the size of the sector
  9. The goal must be clearly set in terms of employment, and policies and measurements of progress set accordingly
  10. Indian statistical systems must be improved quickly to measure employment in various forms, formal as well as informal

Providing tax incentives 

  1. The strategy highlights the urgency of increasing the tax base to provide more resources for human development
  2. It also says financial investments must be increased to strengthen India’s production base
  3. Managing this trade-off will not be easy
  4. If tax incentives must be given, they should favour employment creation, not more capital investment

Increasing mid-level industries

  1. A big weakness in the Indian economy’s industrial infrastructure is that middle-level institutions are missing
  2. Rather than formalising small enterprises excessively, clusters and associations of small enterprises should be formalised
  3. Small enterprises cannot bear the burden of excessive formalisation — which the state and the banking system need to make the informal sector ‘legible’ to them
  4. Professionally managed formal clusters will connect the informal side of the economy with its formal side, i.e. government and large enterprises’ supply chains
  5. NITI Aayog’s plan for industrial growth has very rightly highlighted the need for strong clusters of small enterprises as a principal strategy for the growth of a more competitive industrial sector

Labour laws revamp

  1. It recommends complete codification of central labour laws into four codes by 2019
  2. While this will enable easier navigation for investors and employers through the Indian regulatory maze, what is required is a fundamental reorientation of the laws and regulations — they must fit emerging social and economic realities
  •  First, the nature of work and employment is changing, even in more developed economies
  1. It is moving towards more informal employment, through contract work and self-employment, even in formal enterprises
  2. In such a scenario, social security systems must provide for all citizens, not only those in formal employment
  3. Indeed, if employers want more flexibility to improve the competitiveness of their enterprises, the state will have to provide citizens the fairness they expect from the economy
  4. The NITI Aayog strategy suggests some contours of a universal social security system. These must be sharpened
  • Second, in a world where workers are atomised as individuals, they must have associations to aggregate themselves to have more weight in the economic debate with owners of capital
  1. Rather than weakening unions to give employers more flexibility, laws must strengthen unions to ensure more fairness
  2. Indeed, many international studies point out that one of the principal causes of the vulgar inequalities that have emerged around the world is the weakening of unions
  3. The NITI Aayog strategy mentions the need for social security for domestic workers too
  4. This will not be enforceable unless domestic workers, scattered across millions of homes, have the means to collectively assert their rights
  • Third, all employers in India should realise that workers must be their source of competitive advantage
  1. India has an abundance of labour as a resource, whereas capital is relatively scarce
  2. Human beings can learn new skills and be productive if employers invest in them
  3. Employers must treat their workers — whether on their rolls or on contract — as assets and sources of competitive advantage, not as costs

Way forward

  1. The shape of the development process matters more to people than the size of the GDP
  2. Development must be by the people (more participative), of the people (health, education, skills), and for the people (growth of their incomes, well-being, and happiness)
  3. How well India is doing at 75 must be measured by the qualities of development, as experienced by its citizens, along these three dimensions
NITI Aayog’s Assessment

[pib] NITI Aayog releases Second Delta Ranking under the Aspirational Districts ProgrammePIB


Mains Paper 2: Governance | Government policies and interventions for development in various sectors

From UPSC perspective, the following things are important:

Prelims level:  Delta Ranking 2018

Mains level:  Aspirational District Programme


  • NITI Aayog will release the Second Delta Ranking of the Aspirational Districts Programme (ADP) .

Delta Ranking

  1. The ranking will measure the incremental progress made by districts.
  2. The districts have been ranked in a transparent basis on parameters across Health & Nutrition, Education, Agriculture & Water Resources, Financial Inclusion & Skill Development, and Basic Infrastructure through key performance indicators.
  3. The rankings are based on the data that is publicly available through the Champions of Change Dashboard, which includes data entered on a real-time basis at the district level.
  4. The rankings, for the first time, will also factor in inputs from household survey conducted by NITI Aayog’s knowledge partners, namely, TATA Trusts and the Bill and Melinda Gates Foundation (BMGF).
  5. The first Delta ranking for the Aspirational Districts was released in June 2018.

Performance in 2018

  1. Virudhunagar district in Tamil Nadu has shown the most improvement overall, followed by Nuapada district in Odisha, Siddarthnagar in Uttar Pradesh, Bihar’s Aurangabad and Koraput in Odisha.
  2. These districts have championed the development narrative in fundamental parameters of social progress.
  3. Nagaland’s Kiphire district, Jharkhand’s Giridih, Chatra in Jharkhand, Hailakandi in Assam, and Pakur in Jharkhand have shown least improvement.


Aspirational District Programme

  1. The Aspirational Districts Programme (ADP) is a essential retreat from India’s previous development strategies in its ownership, scope, and scale based on “One-size-fits-all” approach.
  2. 115 districts were chosen by senior officials of the Union government in consultation with State officials on the basis of a composite index of the following:
  • deprivation enumerated under the Socio-Economic Caste Census,
  • key health and education performance indicators and the state of basic infrastructure
  1. A minimum of one district was chosen from every State.
  2. The areas under the programme that have been targeted for transformation are education, health and nutrition, agriculture and water resources, financial inclusion, basic infrastructure and skills.
  3. There is no financial package or large allocation of funds to this programme
  4. Its aim is to leverage the resources of the several government programmes that already exist but are not always used efficiently.
NITI Aayog’s Assessment

[pib] NITI Aayog releases Strategy for New India @ 75PIB


Mains Paper 3: Economy | Indian Economy Issues relating to planning

From the UPSC perspective, the following things are important:

Prelims level: Not much

Mains level: Role of planning in an economy and need of bringing planning back in vogue


  • The NITI Aayog has unveiled its comprehensive national Strategy for New India, which defines clear objectives for 2022-23.

Strategy for New India @ 75

  1. It is a detailed exposition across forty-one crucial areas that recognize the progress already made, identifies binding constraints, and suggests the way forward for achieving the clearly stated objectives.
  2. It is an attempt to bring innovation, technology, enterprise and efficient management together, at the core of policy formulation and implementation.
  3. It will encourage discussion and debate, and invite feedback for further refining our policy approach.

Four Sections Discussed

The forty-one chapters in the document have been dis-aggregated under four sections: Drivers, Infrastructure, Inclusion and Governance.

  • The first section on Drivers focuses on the engines of economic performance with chapters on growth and employment, doubling of farmers’ incomes; upgrading the science, technology and innovation eco-system; and promoting sunrise sectors like fintech and tourism.
  • The second section on Infrastructure deals with the physical foundations of growth which are crucial to enhancing the competitiveness of Indian business as also ensuring the citizens’ ease of living.
  • The third section on Inclusion deals with the urgent task of investing in the capabilities of all of India’s citizens. The three themes in this section revolve around the dimensions of health, education and mainstreaming of traditionally marginalized sections of the population.
  • The final section on Governance delves deep into how the governance structures can be streamlined and processes optimized to achieve better developmental outcomes.
NITI Aayog’s Assessment

[op-ed snap] Make planning fashionable againop-ed snap


Mains Paper 3: Economy | Indian Economy Issues relating to planning

From the UPSC perspective, the following things are important:

Prelims level: Not much

Mains level: Role of planning in an economy and need of bringing planning back in vogue


History of planning in India

  1. India under Nehru’s leadership inaugurated a strategy for industrialisation of the country in the early 1950s
  2. This involved the setting up of public sector units (PSUs) in diverse areas of manufacturing; research institutions in cutting-edge technologies of the time such as space and atomic energy; and centres of higher learning, including the Indian Institutes of Technologies (IITs)
  3. By consciously entering into sectors such as machine building and nuclear research, which needed capital and technology more critically than labour, India was also challenging a deeply held orthodoxy in economic theory
  4. The theory of comparative advantage argued that countries should develop industries based on their comparative advantage
  5. According to this theory, a labour-surplus country like India should be limiting its industrial development ambitions to labour-intensive sectors, such as garments or leather
  6. The British government in India had indeed been putting the theory of comparative advantage into practice — to the disadvantage of most Indians

Evaluating the Indian model of planning

  1. The programmes launched in India from the 1950s onwards to build indigenous capabilities in the capital- and technology-intensive sectors, despite the general poverty of the country, became a model for other developing and Third World nations
  2. The foundations for India’s diversified economic base had been laid during the planning years
  3. The successes that India enjoys today in the information technology and knowledge-intensive sectors owe much to the research and educational institutions that were built during the early decades
  4. At the same time, however, planning did very little to remove the hurdles to the growth of agriculture and small-scale industries
  5. India’s record during the post-Independence period in implementing land reforms and ensuring primary education for all has been rather unimpressive
  6. As a result, the benefits from state-led development have so far reached only a minority of Indians

LPG reforms led to the diminishing of planning

  1. India’s commitment towards development through planning had begun to diminish from the early 1990s itself — much before the Planning Commission was formally dismantled in 2014
  2. After the introduction of economic reforms in 1991, public investment, especially on agriculture and industry, has been on a decline in the country
  3. PSUs have begun to be valued only for the returns they bring as commercial entities
  4. There has been little recognition of the important role that PSUs can play as creators of new technologies and knowledge, particularly in fields in which the private sector may have little interest or capabilities

Impact of reduced role of planning

  1. The disregard for planning and the general withdrawal of the state from economic decision-making have had important consequences on Indian industry
  2. India is today one of the largest markets in the world for a wide range of goods, whether passenger cars, mobile phones or food products
  3. Despite the emergence of such a large domestic market, the record of Indian manufacturing in absorbing the large labour reserves in the country remains abysmal
  4. The imports of machinery, transport equipment, electronic goods and all their components have been rising continuously in India from the 2000s onwards
  5. This trend has not been reversed after the introduction of the ‘Make in India’ initiative

Need of planning

  1. Planning is not incompatible with markets and globalisation
  2. On the contrary, a developing country trying hard to stay afloat amidst the turbulence of a global economy requires more, and not less, guidance through industrial policies
  3. The successes achieved by East Asian countries such as South Korea in manufacturing are, to a great extent, the result of strategic planning over several decades by their governments
  4. The Chinese achievements owe much to the careful planning and investments made by its government, particularly in the area of science and technology

Interventions required

  1. The employment challenge that India faces — close to 15 million waiting to be absorbed in the industrial and services sectors every year — is possibly bigger than that faced by any other country (except China) in the world
  2. It cannot be resolved with the technologies that foreign companies bring into India, which tend to be labour saving
  3. What India requires, on the other hand, are technological advances that create new economic opportunities and absorb — not displace — labour
  4. India’s research institutions and our PSUs should engage in the creation and dissemination of such technologies
  5. The country’s industrial policies should be able to enthuse young and educated entrepreneurs from rural areas to make use of these technologies to create new jobs

Way forward

  1. Economic planning is not considered fashionable today
  2. Nevertheless, contemporary economic debates will have much to gain by revisiting the ideas on planning
  3. Planning should be brought back to the centre of our economic discussions
NITI Aayog’s Assessment

[pib] 4th Edition of NITI Lecture SeriesPIB


Mains Paper 2: Governance | Government policies and interventions for development in various sectors

From UPSC perspective, the following things are important:

Prelims level: NITI lecture Series

Mains level: Various policy initiatives to boost AI ecosystem in India



  • NITI Aayog is organizing the fourth edition of NITI Lecture Series with theme this year is “AI for ALL: Leveraging Artificial Intelligence for Inclusive Growth”.

NITI Lecture Series

  1. The ‘NITI Lectures: Transforming India’ are being held annually since 2016 featuring eminent speakers from across the world.
  2. The aim of the series is to enable learning, both at the Centre & States, from successful development practice world over.
  3. With the vision of disseminating cutting-edge, innovative ideas in development policy to India, the NITI Lectures are attended by the Government’s top decision makers.
  4. Through the lectures, NITI Aayog has been bringing policy makers, academics, experts and administrators of global repute to India.

AI ecosystem in India

  1. Union Budget-2018 mandated NITI Aayog to come up with a national programme on employing AI towards national development.
  2. NITI has, since, published a National Strategy for Artificial Intelligence.
  3. The Strategy is termed #AIForAll as it is focused on leveraging AI for inclusive growth in line with the Government policy of Sabka Saath, Sabka Vikas.
  4. NITI Aayog has signed Statements of Intent (SoI) with industry leaders such as Google, Microsoft and IBM to enable use of artificial intelligence in key, high gain sectors of social development – healthcare, agriculture, smart mobility, education and infrastructure.
  5. Example: India’s diversity of languages is bridged by creating a AI based digital “Ek Bharat, Shrestha Bharat” platform using Natural Language Processing (NLP).
  6. NLP is a system of protocols which allow machines or computers to understand and interact with human speech and symbols.

Focus on R&D

  1. Recognising the importance of research and its commercial adoption in success of AI, NITI has also proposed setting up of Centre of Research Excellence (CORE).
  2. It aims to focus on developing better understanding of existing core research.
  3. Besides this, the Aayog also recommends setting up of International Centres of Transformational AI with a mandate to develop and deploy application-based research in collaboration with private players.

Hurdles for AI in India

  1. Aiming to put AI to use for all and across sectors, NITI has identified barriers that need to be addressed to achieve success in the use of AI.
  2. These include lack of expertise, absence of enabling data ecosystem, high resource cost and low awareness, privacy and security issues and absence of collaborative approach to adoption and application of AI.
NITI Aayog’s Assessment

[pib] India and the UN to sign a Five-Year Sustainable Development Framework (2018-2022)IOCRPIBPrelims Only


Mains Paper 2: IR | Bilateral, regional and global groupings and agreements involving India and/or affecting India’s interests

From UPSC perspective, the following things are important:

Prelims level: UNSDF

Mains level: Sustainable development agenda of NITI Aayog.



  • NITI Aayog and United Nations are set to sign the Government of India-United Nations Sustainable Development Framework (UNSDF) for 2018-2022.

India-UNSDF (2018-2022)

  1. The Framework outlines the work of UN agencies in India, to support the achievement of key development outcomes that are aligned to the national priorities.
  2. The NITI Aayog is the national counterpart for the UN in India for the operationalization of the UNSDF.
  3. Nineteen (19) UN agencies have signed on the UNSDF 2018-2022.

About United Nations Sustainable Development Framework

  1. The UNSDF 2018-22 comprises of seven priority areas that outline the work that UN agencies will undertake jointly or individually, fully aligned with the priorities of the GoI.
  2. The seven priority areas outlined in the UNSDF are:
  • Poverty and Urbanization;
  • Health, Water, and Sanitation;
  • Education and Employability;
  • Nutrition and Food Security;
  • Climate Change, Clean Energy, and Disaster Resilience;
  • Skilling, Entrepreneurship, and Job Creation;
  • Gender Equality and Youth Development.


NITI Aayog’s Assessment

NITI Aayog for clear policy on ‘jhum’ cultivationPrelims OnlyPriority 1States in News


Mains Paper 3: Agriculture | Major crops cropping patterns in various parts of the country

From UPSC perspective, the following things are important:

Prelims level: Jhum Cultivation

Mains level: Need for formalizing Jhum Cultivation.


Recognizing Shifting Cultivation

  1. A recent NITI Aayog report has recommended that the Ministry of Agriculture should take up a “mission on jhum cultivation” to ensure inter-ministerial convergence.
  2. The document said land for shifting cultivation be recognised as “agricultural land” where farmers practise agro-forestry for the production of food rather than as forestland.
  3. Various authorities often have divergent approaches towards shifting cultivation.
  4. This creates confusion among grass-roots level workers and jhum farmers said the report.
  5. The report suggests that shifting cultivation fallows must be legally perceived and categorised as ‘regenerating fallows’ and that credit facilities be extended to those who practise shifting cultivation.

Falling area

  1. Locally referred to as jhum cultivation, this practice is considered as an important mainstay of food production for a considerable population in North-East India.
  2. The report notes that between 2000 and 2010, the land under shifting cultivation dropped by 70 %.
  3. The report quotes data of the Indian Council of Forestry Research and Education which points out that from 35,142 sq km in 2000, the area under jhum cultivation dropped to 10,306 sq km in 2010.
  4. The Wastelands Atlas Map shows a reduction in shifting cultivation in north-eastern States from 16,435.18 sq km to 8,771.62 sq km in two years.

Food security on anvil

  1. While the practice ensures food security it does not provide adequate cash for the families and thus they are shifting to regular agriculture, particularly to horticulture.
  2. The MGNREGA has also had an impact on reducing dependency of people on shifting cultivation.
  3. The issue of food and nutritional security of communities involved in jhum cultivation during transition and transformation is rampant
  4. It can be ensured by broadening the PDS to ensure widespread access to cereals and other basic food items.

Issues with Jhum Cultivation

  1. One of the issues jhum cultivation was that people were returning to fallow land left after shifting in a shorter span.
  2. Earlier the cultivators returned to fallows after 10-12 years, now they are returning in three to five years which has impacted on the quality of the soil.


Jhum (Shifting) cultivation

  1. It is a slash and burn practice of cultivation in States of North Eastern Hill Region of India and people involved in such cultivation are called Jhumia.
  2. It involves technique carried out since the Neolithic period from 13,000 to 3,000 B.C.
  3. The practice involves clearing vegetative/forest cover on land/slopes of hills, drying and burning it before onset of monsoon and cropping on it thereafter.
  4. After harvest, this land is left fallow and vegetative regeneration is allowed on it till the plot becomes reusable for same purpose in a cycle.
  5. Initially, when Jhum cycle was long and ranged from 20 to 30 years, the process worked well.
  6. However, with increase in human population and increasing pressure on land, Jhum cycle reduced progressively (5-6 years) causing problem of land degradation and threat to ecology of the region at large.
  7. Burning of residues provide potash to the soil. However it has several cons.
  8. Tree burning leads to:
  • Higher  CO2, NO2 and other Greenhouse gases (GHGs) emissions
  • Loss of Biomass hence higher surface run off of rainwater leading to soil erosion
NITI Aayog’s Assessment

[pib] NITI Aayog launches “Pitch to MOVE”PIBPrelims Only


Mains Paper 2: Governance | Government policies and interventions for development in various sectors and issues arising out of their design and implementation.

From UPSC perspective, the following things are important:

Prelims level: Pitch to MOVE

Mains level:  The newscard highlights the importance of clean energy options in manufacture of electric vehicles that gives various benefits.


Pitch to MOVE Contest

  1. It is organised by NITI Aayog in collaboration with Invest India and Society of Indian Automobile Manufacturers (SIAM) as a part of a series of engaging featured events in the run up to the main event.
  2. The competition aims to identify and reward the start-ups offering innovative solutions for shared, connected, and environment friendly mobility.
  3. The Startups can be from the domain of Public Mobility, Electric Vehicles, Shared Transport, Last Mile Connectivity, Passenger Transportation, Battery Technology, Automotive IoT, Freight & Logistics, Powertrain/Drivetrain, Experiential, Travel, Mobility Infrastructure and Automotive Electronics etc.
  4. The Mobility Pitch Competition is open to primarily startups from various parts of India who are interested in showcasing their business ideas to jury members.

Aim of the initiative

  1. Startups working in the various fields of mobility can pitch their ideas to industry leaders and Venture Capitalists for raising investments.
  2. With rapidly evolving technologies and business models for delivering mobility services, our goal of cleaner and more efficient mobility systems will be achieved with the help of the dynamic entrepreneurial class of India.
  3. The objective is to harness the latest disruption for generating employment and growth in our country.
  4. Winners of the event will be felicitated by PM during the Global Mobility Summit.


Global Mobility Summit

  1. Steeply falling technology costs and business – model innovation are driving the world’s transition to renewable energy and electric vehicles.
  2. Against this background, NITI Aayog, in collaboration with various ministries and industry partners, is organising ‘MOVE: Global Mobility Summit’.
  3. This Summit will help drive Government’s goals for vehicle electrification, renewable energy integration and job growth and also speed up India’s transition to a clean energy economy.
  4. MOVE Summit aims to bring together and engage with key stakeholders within the rapidly transforming global mobility landscape and to evolve a public interest framework for a shared, connected, zero emission and inclusive mobility agenda for the future.
  5. The Summit, hence, aims to encourage synergies between indigenous industries such as Automobile Manufacturing, Information Technology, Electronics, Telecommunications and others, to integrate with global supply chains and cement India’s position as a progressive, forwarding looking nation.
NITI Aayog’s Assessment

[pib] NITI Aayog to Release First Delta Ranking under the Aspirational Districts ProgrammeGovt. SchemesPIBPriority 1


From UPSC perspective, the following things are important:

Prelims level: Aspirational District Programme, Delta Ranking

Mains level: Read the attached story.


Delta Ranking

  1. NITI Aayog will release the First Delta Ranking of the Aspirational Districts Programme
  2. The ranking will measure the incremental progress made by districts between March 31, 2018, and May 31, 2018.
  3. The districts have been ranked in a transparent basis on parameters across Health & Nutrition, Education, Agriculture & Water Resources, Financial Inclusion & Skill Development, and Basic Infrastructure through 49 key performance indicators.
  4. The rankings are publicly available through the Champions of Change Dashboard, which includes data entered on a real-time basis at the district level.
  5. The Delta ranking seeks to highlight the Districts who have achieved incremental progress between the months of March 2018 and May 2018.


Aspirational District Programme

  1. The Aspirational Districts Programme (ADP) is a essential retreat from India’s previous development strategies in its ownership, scope, and scale based on “One-size-fits-all” approach.
  2. 115 districts were chosen by senior officials of the Union government in consultation with State officials on the basis of a composite index of the following:
  • deprivation enumerated under the Socio-Economic Caste Census,
  • key health and education performance indicators and the state of basic infrastructure
  1. A minimum of one district was chosen from every State.
  2. The areas under the programme that have been targeted for transformation are education, health and nutrition, agriculture and water resources, financial inclusion, basic infrastructure and skills.
  3. There is no financial package or large allocation of funds to this programme
  4. Its aim is to leverage the resources of the several government programmes that already exist but are not always used efficiently.
NITI Aayog’s Assessment

Development agenda for 2022 soon: NITI Aayog


Mains Paper 3: Economy | Indian Economy Issues relating to planning

From UPSC perspective, the following things are important:

Prelims level: NITI Aayog, New India 2022

Mains level: India’s development plans and issues related to them

New development plan

  1. NITI Aayog will soon come out with a development agenda for ‘New India 2022’, which will spell out the strategy for expediting economic growth
  2. NITI Aayog will start working on a 15-year vision document after finalizing the development agenda document
  3. NITI Aayog had earlier planned to come out with three documents—three-year action agenda, seven-year medium-term strategy paper, and a 15-year vision document
NITI Aayog’s Assessment

NITI to open applications for Atal New India Challenge


Mains Paper 2: Governance | Government policies and interventions for development in various sectors and issues arising out of their design and implementation.

From UPSC perspective, the following things are important:

Prelims level: Particulars of the AIM

Mains level: The Atal New India Challenge will help in creating innovation environment in the country.

Atal New India Challenge

  1. The Atal Innovation Mission (AIM) has recently launched a challenge in which grants of up to Rs 1 crore and mentorship will be given to the winning ideas
  2. The AIM is a mission under NITI Aayog
  3. Under the Atal New India Challenge, AIM will invite prospective innovators to design market-ready products, using cutting edge technologies across 17 identified focus areas
  4. such as Smart Mobility, Predictive Maintenance of Rolling Stock and Waste Management

The provision of the financial grant

  1. The applicants showing capability, intent and potential to productise technologies will be awarded grants up to Rs 1 crore
  2. According to the statement, this grant will be further supplemented by mentoring, handholding, incubating and other support as needed at various stages of commercialisation, while generating wider deployment for the product


Atal Innovation Mission (AIM)

  1. The AIM was launched by the NITI Ayog as an innovation promotion platform involving academics, entrepreneurs, and researchers utilizing national and international experience to promote the culture of innovation, R and D in India particularly in technology oriented areas
  2. The AIM along with Self-Employment and Talent Utilization (SETU) are Government of India’s the leading ventures to promote a culture of innovation and entrepreneurship
  3. The Atal Innovation Mission has two core functions:
    (1) Entrepreneurship promotion through Self-Employment and Talent Utilization, wherein innovators would be supported and mentored to become successful entrepreneurs
    (2) Innovation promotion: to provide a platform where innovative ideas are generated
NITI Aayog’s Assessment

EAC: PM suggests incentives to states for skill development, more employment

Image source


Mains Paper 3 | Indian Economy and issues relating to planning, mobilization of resources, growth 

Prelims level: EAC, 15th Finance Commission, Economy Tracking Monitor

Mains level: The news card talks about the EACs second meeting



EAC Second Meeting: Key points

  1. The Economic Advisory Council to the Prime Minister (EAC-PM), in its second meeting, outlined a roadmap for stepping up skill development, job creation, enhanced resource investment in the social sector including for health and education and for boosting infrastructure financing
  2. The EAC-PM, chaired by Niti Aayog Member Bibek Debroy, formulated recommendations to guide the evolving framework for the 15th Finance Commission, including the incentivization of states for achieving health, education and social inclusion outcomes.
  3. The Council is also evolving the design of a new Economy Tracking Monitor, linking economic growth indicators with social indicators.

What is required now?

  1. According to the council, improvements are needed in National Accounts and innovative steps are required for unlocking the growth
  2. Exports and employment potential of growth drivers were also deliberated upon including through transformation of India’s Gold Market
  3. There is a need for infrastructure financing to be accorded high priority
  4. The strategies for achieving Swastha Bharat by 2022 were also highlighted

Uniqueness of EAC

  1. The unique feature of the EAC is turning out to be its ability to link economic growth with social aspects, with greater last mile connectivity.
  2. Its value addition as an independent institutional mechanism for providing informed advice to the Prime Minister is increasingly being recognized, with focused time-bound recommendations to move from policy to practice, benefiting from consultation with a wide spectrum of experts and stakeholders.

EAC First Meeting

  1. In its first meeting last month, the EAC-PM had stressed the need to accelerate economic growth and employment over the next six months and identified 10 areas on which it will prepare reports and make recommendations to the government over the next few months


Economic Advisory Council to the Prime Minister (EAC-PM)

  1. It is an independent body to give advice on economic and related issues to the Government of India, specifically to the Prime Minister
  2. The terms of reference of EAC includes-
  • To analyze any issue, economic or otherwise, referred to it by the prime minister and advising him thereon;
  • To address issues of macroeconomic importance and presenting views thereon to the prime minister.
NITI Aayog’s Assessment

[op-ed snap] A troubling snapshot of Indian manufacturingop-ed snap

Image Source


Mains Paper 3: Economy | Effects of liberalization on the economy, changes in industrial policy and their effects on industrial growth

Q.) How can the government remove barriers to growth in the manufacturing sector?

From UPSC perspective, the following things are important:

Prelims level: Particulars of the report

Mains level: The article effectively explains the issues related to employment and productivity in the Manufacturing Sector.



  1. The article talks about the condition of Indian Manufacturing Sector and the recently released Ease Of Doing Business report by NITI Aayog and the IDFC Institute

Main issue with enterprises in Manufacturing Sector

  1. Enterprises in this sector have a growth problem
  2. Majority of these enterprises are dwarfs, unable to increase the share of Manufacturing sector in the economy
  3. These dwarfs dominate the sector numbers-wise
  4. They suffer from low productivity given that their small size prevents them from achieving economies of scale, among other disadvantages
  5. However, they employ a huge chunk of the labour force

Issues with Jobs, created by Manufacturing Sector

  1. The jobs created by dwarf enterprises are low-paying ones
  2. The wage spread between small and large enterprises is a disquieting 80%
  3. Compare this to China, where the spread is just about half that

What should be done to counter the problems?

  1. Improving physical infrastructure is essential
  2. This ranges from transport systems to the power sector
  3. The report by NITI Aayog also mentions the need to improve access to finance for smaller enterprises and making firm entry and exit easier, among other measures

Older Manufacturing firms Vs. Younger Firms

  1.  The report throws up some interesting facts
  2. Most of the young enterprises are located in Maharashtra, Gujarat, Tamil Nadu, Andhra Pradesh and Telangana
  3. Concurrently, unlike in other states, older manufacturing firms in Andhra Pradesh, Telangana, Maharashtra and Gujarat face a lower regulatory burden than younger firms
  4. The latter are thus disadvantaged in the states where they are highly concentrated
  5. It creates a barrier to growth and productivity

The way forward

  1. Political compulsions have often been offered up as an excuse for going slow on reforms related to manufacturing sector
  2. Government should take care of this
NITI Aayog’s Assessment

Odisha rated as low-growth State

Image Source


Mains Paper 3: Economy | Inclusive growth and issues arising from it.

From UPSC perspective, the following things are important:

Prelims level: Particulars of the report

Mains level: ‘Ease of doing business’ is one of the most important priorities of the government.


The NITI Aayog’s ‘Ease of Doing Business Report: An Enterprise Survey of Indian States’

  1. The report has released recently
  2. It points at more issues in setting up new businesses in Odisha compared to other States
  3. The 15-high growth States include Bihar, Uttarakhand, Tripura, Sikkim and Meghalaya
  4. Basis of the report: The NITI Aayog and IDFC Institute, its knowledge partner, have classified States on the basis of their average annual real growth rate
  5. By using State GDP from 2004-05 to 2013-14
NITI Aayog’s Assessment

Under-employment severe in India: NITI

Image Source


Mains Paper 2: Governance | Government policies and interventions for development in various sectors and issues arising out of their design and implementation.

From UPSC perspective, the following things are important:

Prelims level: What is Underemployment?

Mains level: The shows the concerns of NITI Aayog regarding the employment issues in India.



  1. NITI Aayog has said, in its three year agenda that not unemployment but a “severe under-employment” is the main problem facing the country
  2. NITI Aayog has a goal of promoting highly productive and well-paid jobs

What is Underemployment?

  1. Underemployment, or disguised unemployment, refers to a job that is insufficient in some important way for a worker, relative to a standard, which results in the under-utilization of the worker
  2. Examples include holding a part-time job despite desiring full-time work, and overqualification, where the employee has education, experience, or skills beyond the requirements of the job.

Recommendations from the NITI Aayog

  1. The Aayog recommended the creation of a handful of Coastal Employment Zones, which may attract multinational firms in labour-intensive sectors from China to India
NITI Aayog’s Assessment

Niti Aayog’s Appraisal of the Twelfth Five Year Plan: Low manufacturing growth holds back job creation

Image Source


Mains Paper 2: Governance | Government policies and interventions for development in various sectors and issues arising out of their design and implementation.

From the UPSC perspective, the following things are important:

Prelims Level: Not Much

Mains Level: Important suggestion for improving the condition manufacturing sector of Indian Economy. These suggestions are more important because they are from a Report of NITI Aayog.


Issues with Manufacturing sector

  1. According to NITI Aayog’s report, the sector’s growth rate has remained constant for the past 25 years
  2. Whereas countries such as Taiwan and China recorded more than double the rate of expansion in India

Example of other countries

  1. In Taiwan and South Korea in the 1960s and 1970s and in China in the 1980s, 1990s and 2000s, manufacturing grew at rates approaching or exceeding 15 per cent
  2. It lead to transformation of these economies from primarily agrarian and rural character to modern urban ones in around three decades

India’s situation

  1. The fast-growing sectors in India have been automobile and its parts, two-wheelers, machinery, chemicals, petroleum refining, telecommunications, software and pharmaceuticals
  2. None of these sectors employs low-skilled workers in large numbers
  3. As a result, the vast majority of Indian workers remain concentrated in agriculture, unorganised industry or low-paying services

Challenges in front of India

  1. To achieve rapid growth in manufacturing sector
  2. Ensuring healthy growth in labour-intensive sectors such as clothing, leather manufactures, food processing and electronic assembly
  3. Growth in these sectors would help create good jobs for workers with limited skills

Suggestions by the Niti Aayog in its three-year action plan
Suggestions include

  1. Easing entry barriers and reducing duties on synthetic fibres to make India’s apparel industry competitive in global market
  2. Reducing custom duty on gold
  3. Increasing investment in skill training
  4. Expediting creation of integrated mega food parks and lower duties on key inputs of final electronics products
NITI Aayog’s Assessment

Give tax breaks for digital payments, says Niti Aayog I

  1. What: Niti Aayog has proposed giving tax breaks to consumers and merchants for debit or credit card payments
  2. It has also suggested levying surcharge for cash transactions beyond a set limit to encourage electronic transactions
  3. Reason: Niti Aayog CEO Amitabh Kant pitched for encouraging e-payments for driving online commerce
  4. This would also bring in greater transparency and higher tax collection for the government
  5. In South Korea, the government promoted electronic payments by providing tax breaks on electronic transactions
NITI Aayog’s Assessment

Give tax breaks for digital payments, says Niti Aayog II

  1. E-commerce: Mr.Kant observed that e-commerce contributed about only 1% to the total retail market as compared to 14% in China
  2. It was pointed out that existing legislation does not recognise e-commerce consumers
  3. Niti Aayog recommended early enactment of Consumer Protection Bill 2005 introduced in Lok Sabha in October 2015
  4. And also updating National Consumer Helpline regularly for e-commerce complaints
NITI Aayog’s Assessment

Five-year Plans out, 15-year vision soon- II

  1. The current 12th Five-Year Plan will be terminated in the current financial year, 2016-17 in order to facilitate the 15 year vision document
  2. The mid-term appraisal of the 12th Plan is also not done though it was due after the completion of two-and-a- half years
  3. PMO has also instructed NITI Aayog to undertake outcome-based monitoring of all government programmes and ministries on a yearly basis
  4. Aim: Keeping a tab on the progress made and work done
NITI Aayog’s Assessment

About the National Development Agenda

  1. The agenda will lay down the schemes, programmes and strategies to achieve the long-term vision
  2. It will also deal with issues related to internal security, defence and external affairs (Planning Commission rarely dealt with these issues directly)
  3. Review: After a gap of every three years to ensure that it was aligned with financial needs and requirements
  4. For the first Development Agenda, the review would be done in 2019-20, in line with the termination year of the 14th Finance Commission
NITI Aayog’s Assessment

Five-year Plans out, 15-year vision soon- I

  1. Vision Doc: Govt has decided to get rid of the five-year plans and replace them with 15-year vision documents
  2. These will be framed keeping in mind the country’s social goals and the sustainable development agenda
  3. The first 15-year vision document will start from 2017-18 & NITI Aayog has been directed to prepare a vision document at the earliest
  4. Also there will be a 7-year National Development Agenda
NITI Aayog’s Assessment

NITI Aayog plans new planning framework

  1. News: NITI Aayog is working on a sector-based medium-term planning framework
  2. The medium-term growth is dependent on past performance
  3. Purpose: The new planning framework could replace five-year plans, as XII FYP will end in FY 2016-17
  4. Challenge: Long-term growth can only be enhanced by structural reforms and improving the productive capacity of the economy
NITI Aayog’s Assessment

Plans to revive Investment Commission

  1. Context: Centre is planning to revive Investment Commission
  2. Aim: Arresting India’s falling investment rate
  3. Relevance: Earlier, it functioned under the finance ministry from December 2004 to December 2009
  4. In new form, it could be part of NITI Aayog
  5. Function: To make recommendations to govt on policies and procedures to facilitate investment
NITI Aayog’s Assessment

NITI Aayog: 2nd regional consultation

  1. Context: 2nd Regional Consultations on Agricultural Development in New Delhi
  2. Held by: NITI Task Force on Agricultural Development under the chairmanship of Vice Chair Arvind Panagariya
  3. Demands: southern states pitched for preparation of a model land leasing act and higher remunerative prices for farmers
  4. Other areas: shared best practices in area of agriculture and water resources; river linking and water conservation and harvesting; emphasis on strengthening of agricultural co-operatives
NITI Aayog’s Assessment

NITI Aayog wants formula to transfer funds to states

NITI Aayog has called for the creation of an objective and transparent formula to distribute central funds to states under the centrally sponsored schemes (CSS)

  1. This is in line with the recommendation of the sub-group on rationalisation of CSS
  2. State govts should have a broad appreciation of the quantum of Central funds that is committed to them scheme-wise
  3. This helps them to plan better and also ensure speedier execution of CSS
  4. Task of creating the formula has been entrusted to a 3-member committee with the secretary of the nodal ministry implementing the CSS as the chairman
  5. NITI Aayog will give its inputs and recommendations based on consultation with all state governments
NITI Aayog’s Assessment

NDC to be scrapped, NITI Aayog council likely to get its powers

  1. The Cabinet will take up NDCs closure and pass a resolution for transferring its powers to the Governing Council of the NITI Aayog.
  2. PM will take up the resolution with the CMs at a meeting of the Governing Council of the NITI Aayog.
  3. National Development Council (NDC) was setup in 1952 by an executive order.
  4. It served as the highest decision making authority in the country on development matters.
NITI Aayog’s Assessment

Amitabh Kant appointed CEO of NITI Aayog

Decision in this regard was taken by Appointments Committee of the Cabinet (ACC) headed by Prime Minister Modi in New Delhi.

  1. Senior IAS officer Amitabh Kant has been given additional charge as Chief Executive Officer (CEO) of National Institution for Transforming India (NITI) Aayog.
  2. Mr. Kant’s appointment comes after incumbent NITI Aayog CEO Sindhushree Khullar’s extended tenure is coming on 31st December 2015.
  3. Amitabh Kant is IAS officer of 1980 Batch of Kerala Cadre.
  4. Presently, he is serving as Secretary, Department of Industrial Policy and Promotion (DIPP) and is expected to retire in March 2016.
NITI Aayog’s Assessment

NITI Aayog panel moots private funding for R&D

A NITI Aayog panel on innovation has recommended that the private sector should help fund R&D, including in research labs at universities and startups.

  1. The panel has also recommended improved tax benefits for investments equivalent to a percentage of corporate profits.
  2. The panel also suggested a ‘Make in Universities’ program which would involve setting up 500 tinkering labs.
  3. It also recommended Grand Prizes approach to finding ultra-low-cost solutions to India’ s most intractable problems.
  4. Incentivised innovation has worked around the world in stimulating innovation.
NITI Aayog’s Assessment

People’s Planning Campaign and NITI Aayog

  1. Kerala’s People’s Planning Commission (PPC) and the NITI Aayog are similar models of planning.
  2. The PPC was introduced in the mid 1990’s is not fully implemented in Kerala, but fiscal decentralisation is done by PPC while NITI Ayog plays the role of facilitator.
NITI Aayog’s Assessment

UIDAI shifted to IT ministry from NITI Aayog

  1. Earlier, UIDAI was the part of Planning Commission.
  2. The Unique Identification Authority of India (UIDAI), which issues Aadhaar cards, has been shifted to the administrative control of the ministry of communication and information technology from NITI Aayog.
  3. Move to shift UIDAI from NITI Aayog is taken keeping in mind govt’s ambitious ‘Digital India’ plan as Aadhaar numbers are being linked with several services
  4. Aadhaar is a 12-digit individual identification number issued by UIDAI.
NITI Aayog’s Assessment

NITI Aayog plans subsidy regime revamp

  1. NITI Aayog proposes to marry data from Aadhaar, the Jan Dhan accounts & the socio economic & caste census to better target subsidies.
  2. The plan has been inspired by the so-called JAM (Jan Dhan, Aadhaar, Mobile) trinity proposed by the finance ministry.
  3. The estimated direct fiscal cost of both central and state government subsidies is about Rs.3.78 trillion, or about 4.2% of GDP.

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