| On 15th August 2006, when Prime Minister | | | | women, cleanliness of rivers, raising the age of |
| Manmohan Singh will address the nation from | | | | marriage and improve the economic base of India |
| Rampant of Lal Quila, India will be completing its | | | | . |
| 59 years of Independence and will be entering into | | | | India Shinning : Moving forward with Passion and |
| "Diamond Jubilee" year of its existence. Let the | | | | Determination - India in 21st Century |
| celebrations continue for centuries and keep the | | | | Highlights of Economic Survey -2006-07 |
| tri-color high. Before I proceed further I like to | | | | 1. Economy projected to grow at 8.1% in |
| share with you the Speech of Pt. Jawahar Lal | | | | 2005-06. |
| Nehru delivered on 15th August 1947...Tryst with | | | | 2. Modest inflation in spite of spiraling global crude |
| Destiny... | | | | prices. |
| "Long years ago we made a tryst with destiny, | | | | 3. Rapid growth in exports and imports. |
| and now the time comes when we shall redeem | | | | 4. Faster development of physical infrastructure. |
| our pledge, not wholly or in full measure, but very | | | | 5. Progress in fiscal consolidation. |
| substantially. At the stroke of midnight hour, when | | | | 6. Industry and services propel overall growth of |
| the world sleeps, India will awake to life and | | | | the economy. |
| freedom. | | | | 7. Industrial resurgence driven by Manufacturing |
| A moment comes which comes but rarely in | | | | and construction sectors. |
| history, when we step out from the old to the | | | | 8. Broad-based Services sector growth. |
| new, then an age ends, and when the soul of a | | | | 9. Total food grains production projected to |
| nation, long suppressed, finds utterance. It is fitting | | | | increase by 2.3% from 204.6 MT in 2004-05 to |
| that at this solemn moment we take the pledge | | | | 209.3 MT in 2005-06. |
| of dedication to India and her people and to the | | | | 10. Continued reduction in the incidence of |
| still larger cause of humanity. At the dawn of | | | | poverty. |
| history India started on her unending quest, and | | | | 11. Pick up in investment and acceleration in |
| trackless centuries are filled with her striving and | | | | growth strengthened in 2005-06. |
| the grandeur of her successes and her failures. | | | | 12. Virtuous cycle of growth and savings likely to |
| Through good and ill fortune alike she has never | | | | continue for some years to come. |
| lost sight of that quest or forgotten the ideals | | | | 13. Policy framework to harness the dormant |
| which gave her strength. We end today a period | | | | talent pool of Indian work-force and |
| of ill fortune and India discovers herself again. | | | | entrepreneurs to position the economy on a |
| The achievement we celebrate today is but a | | | | sustained high-growth trajectory suggested. |
| step, an opening of opportunity, to the greater | | | | 14. Speedy provision of quality infrastructure |
| triumphs and achievements that await us. Are we | | | | through appropriate policy stimulus highlighted. |
| brave enough and wise enough to grasp this | | | | 15. A reversal of the slowdown in the mining |
| opportunity and accept the challenge of the | | | | sector, particularly coal stressed. |
| future? Freedom and power bring responsibility. | | | | 16. Reform of the tax system favored. |
| That responsibility rests upon this assembly, a | | | | The latest Economic Survey in an attempt to |
| sovereign body representing the sovereign people | | | | prune the fiscal deficit calls for improving the |
| of India. Before the birth of freedom we have | | | | quality of expenditure, better productivity in |
| endured all the pains of labor and our hearts are | | | | expenditure and greater growth dividend through |
| heavy with the memory of this sorrow. Some of | | | | deepening the reform process that could harness |
| those pains continue even now. | | | | higher savings and investment. |
| Continuation from PART-I | | | | Regarding the Securities Market, the Survey's |
| Government of India | | | | highlights are enlisted as below: |
| India is a SOVERRIGN, SOCIALIST, SECULAR, | | | | 1. Stock Market Index registers returns of 36 per |
| and DEMOCRATIC REPUBLIC. The Constitution of | | | | cent in 2005 as against 11 per cent in 2004. |
| India, which came into force on 26th January | | | | 2. Rs. 30,325 crore of resources raised in the |
| 1950, is the supreme law of the land. India has a | | | | primary market for equity in 2005. |
| federal form of government (with a high degree | | | | 3. 55 Initial Public Offerings (IPOs), roughly 4 IPOs |
| of Centralization) and a bicameral parliament | | | | every month, issued in 2005. |
| operating under a Westminster-Style | | | | 4. National Stock Exchange and Bombay Stock |
| parliamentary system. It has three branches of | | | | Exchange retain the world ranking at 3 and 5 |
| governance: the Legislature, Executive and | | | | respectively. |
| Judiciary. | | | | 5. From January 2002 to December 2005, Nifty |
| For the Union government of India, the President | | | | Index goes up from 1075 to 2837 giving |
| is the Head of State, and has a largely ceremonial | | | | compound returns of 27.45 per cent per annum |
| role, including interpreting the constitution, signing | | | | 6. Nifty Junior Index rise from 1349 to 5541 giving |
| laws into action, issuing administrative orders and | | | | compound returns of 42.36 per cent per annum |
| issuing pardons. He is also the Commander-in-chief | | | | from January 2002 to December 2005 |
| of India's Armed Forces. An electoral college | | | | 7. Market capitalization of Nifty at Rs. 13.5 lakh |
| elects the President indirectly for five-year terms, | | | | crore and Nifty Junior at Rs. 2.2 lakh crore adds |
| consisting of the members of Parliament and of all | | | | upto Rs. 15.7 lakh crore or roughly two-thirds of |
| the state Legislative Assemblies in a very | | | | the broad Indian equity market at the end of |
| complicated scheme. The Prime Minister is the de | | | | December, 2005 |
| facto head of Government, and has most | | | | 8. Impact cost for doing transactions in the Nifty |
| executive powers. He or she is appointed by the | | | | and Nifty Junior drops steadily and sharply |
| President. As a general rule and rather a very | | | | 9. Total equity market turnover goes up from Rs. |
| strict convention, the President appoints only that | | | | 43 lakh crore in 2004 to Rs. 60.2 lakh crore in |
| person as the Prime Minister who enjoys the | | | | 2005 |
| support of the majority of the members in the | | | | 10. Number of depository accounts at National |
| Lok Sabha (the lower house of the Parliament), | | | | Securities Depository Limited (NSDL) and Central |
| and serves a five-year term, with re-selection | | | | Depository Services Limited (CDSL) stands at 85 |
| possible. | | | | lakhs |
| The legislature of India is the bicameral Parliament | | | | 11. Number of depository accounts at NSDL |
| (Sansad), which consists of the upper house called | | | | continues to grow rapidly (72,76,300) with the rise |
| the Rajya Sabha (Council of States), and the | | | | of 21.9 per cent in 2005 which corresponds to |
| lower house called the Lok Sabha (House of | | | | over 5,000 accounts being opened per working |
| People). The 245-member Rajya Sabha is chosen | | | | day; 12,70,071 CDSL accounts in 2005. |
| indirectly through the state Legislative Assemblies, | | | | 12. Assets under management of all mutual funds |
| and has a staggered six-year term. Each state | | | | rise to a level of roughly Rs. 2 lakh crore in 2005 |
| sends members to the Rajya Sabha in a | | | | in comparison to approximately Rs. 1.5 lakh crore |
| proportion of its population (unlike the Senate of | | | | in the previous year. |
| the United States). The 545-member Lok Sabha | | | | 13. Number of Foreign Institutional Investors (FIIs) |
| is directly elected by popular vote for a five-year | | | | rises to 823 and number of sub-accounts stands |
| term, and is the determinative constituent of | | | | at 2273 in December 2005 |
| political power and government formation. All | | | | 14. Net investments from FIIs on equity spot |
| Indian citizens above age 18 are eligible to vote. | | | | market rise to Rs. 47,182 crore in 2005 as against |
| The Lok Sabha is subject to dissolution by the | | | | Rs. 38,965 crore in 2004 |
| President but the Rajya Sabha is not. | | | | 15. Turnover of commodity of futures in the four |
| The executive arm consists of the President, | | | | commodity exchanges of the country rises to Rs. |
| Vice-President and the Council of Ministers (the | | | | 13.87 lakh crore in 2005 |
| Cabinet being its executive committee), headed | | | | 16. In context of Agriculture the Survey highlights |
| by the Prime Minister. Any minister holding a | | | | are enlisted below. |
| portfolio must be a member of either house of | | | | The Economic Survey for 2005-06 has estimated |
| parliament. In the Indian parliamentary system, | | | | a growth rate of 2.3% in the agricultural |
| the executive is subordinate to the legislature. All | | | | production as against a lower growth rate of |
| ministers are appointed and dismissed by the | | | | 0.7% during 2004-05. |
| President on the advice of the Prime Minister. The | | | | 1. The total food grains production is estimated to |
| President is bound to follow the advice of the | | | | be 209.3 million tonnes in the year against 204.6 |
| Council of Ministers while making any executive | | | | million tonnes in 2004-05. |
| decision or order, but may ask the Council to | | | | 2. The Kharif production has been estimated at |
| reconsider its decision once. | | | | 105.3 million tonnes in 2005-06 against 103.3 million |
| India's independent judiciary consists of the | | | | tonnes in 2004-05. |
| Supreme Court, headed by the Chief Justice of | | | | 3. The production of Rabi food grains is expected |
| India--all appointed by the President. The Supreme | | | | to be around the previous years level of 101.3 |
| Court has both original jurisdiction over disputes | | | | million tonnes. |
| between states and the Centre, and appellate | | | | 4. The Kharif oilseeds production for 2005-06 is |
| jurisdiction over the High Courts of India. Each of | | | | estimated at 14.6 million tonnes as per first |
| these states has a tiered system of lower courts. | | | | advance estimates while Rabi oilseeds production |
| The Supreme Court has the right to declare laws | | | | is estimated to reach the target level of 10.4 |
| and orders passed by the government as null and | | | | million tonnes with favorable weather. |
| void if they are in conflict with the Constitution. | | | | 5. The sugarcane output is estimated to increase |
| Impeachment of the President and the judges of | | | | to 257.7 million tonnes in 2005-06 against a level |
| the Supreme Court requires a two-thirds majority | | | | of 232.3 million tonnes in the previous year. |
| in each house of the Parliament. Removal of the | | | | 6. The cotton production may come down to 15.9 |
| Prime Minister requires a simple majority in the | | | | million tonnes from 17 million tonnes in 2004-05. |
| Lok Sabha. | | | | 7. The Economic Survey terms horticulture, |
| The federating states (rajya) of India have a | | | | floriculture, organic farming, genetic engineering, |
| governor as the titular head of the province; a | | | | food processing, branding and packaging and |
| Chief-Minister has the real head of the | | | | futures trading as the areas emerging with a |
| government (with his council of ministers) and a | | | | potential for high growth. |
| directly elected Vidhan Sabha (Legislative | | | | 8. The production of horticulture products was |
| Assembly) to which he is responsible, and | | | | 164 million tonnes in 2004-05, contributing 28% of |
| optionally an upper house Vidhan Parishad | | | | GDP from agriculture. |
| (Legislative Council). The highest court of a state | | | | 9. A shift from the current MSP and Public |
| is its High court, whose judges are appointed by | | | | Procurement System and developing alternative |
| the President and not by the governor. There are | | | | product markets are essential for crop |
| 18 appellate High Courts, each having jurisdiction | | | | diversification and broad-based agricultural |
| over a state or a group of smaller states. No | | | | development. |
| state has its own Constitution except Jammu and | | | | Regarding the Industries highlights, the survey |
| Kashmir. No state has a separate citizenship (in | | | | enumerates: |
| Jammu and Kashmir, there is a constitutional | | | | 1. Coal, electricity, crude petroleum, refinery |
| provision of permanent resident of the state). | | | | throughput, steel and cement that havea direct |
| Economy of a Country is a matter of Choices | | | | bearing on infrastructure registered a growth of |
| and not Chances - Indian Economy from | | | | 4.5 per cent in April-December 2005 as compared |
| 1947-2005 | | | | to 6.4 per cent registered during the |
| The launching of the First Five Year Plan in April | | | | corresponding period of last year. |
| 1951 initiated a process of planned economic | | | | 2. The recently introduced private-public |
| development of the country--aiming not merely at | | | | partnership (PPP) model had limited success in the |
| raising the standard of living of the people, but | | | | area of electricity and mining and the dominance |
| also opening out to them new opportunities for a | | | | of the public sector continued. |
| richer and a more varied life. This was sought to | | | | 3. The targets of tele-density levels have been |
| be achieved by planning for growth and social | | | | surpassed. The total number of telephones (basic |
| justice. Indian economy has come a long way | | | | and mobile) rose from 22.8 million in 1999 to more |
| completing its nine Five-Year Plans and launching | | | | than 125 million at the end of December 2005. |
| the tenth Five Year Plan in April, 2002. | | | | 4. The overall figure of tele-density has risen from |
| First Plan: The first five-year plan focused on | | | | a mere 2.32 per one hundred populations in 1999 |
| Agriculture. During First Five-Year Plan net | | | | to 11.32 in December 2005. |
| domestic product went up by 15%. It was due to | | | | 5. As on November 30, 2005, 6271 Kms of roads |
| the fact that the first plan laid foremost priority | | | | under National Highway Development Project with |
| on agriculture. Per capita income also went up by | | | | the bulk of 5097 Kms. lying on the Golden |
| 8%. Lower increase of per capita income as | | | | Quadrilateral was completed, and another 6179 |
| compared to national income was due the rapid | | | | Kms. was under construction. |
| increase in population. | | | | 6. The cargo handled by the major ports achieved |
| Second Plan: The second five-year plan focused | | | | a 12.7 per cent growth up to December, 2005 as |
| on industry, especially heavy industry. Domestic | | | | compared to 11.3 per cent registered in 2004-05 |
| production of industrial products was encouraged, | | | | 7. The International airports in Delhi and Mumbai |
| particularly in the development of the Public | | | | are being modernized and upgraded through |
| Sector. | | | | private sector participation. Construction work at |
| Third Plan: The planned stress was on agriculture, | | | | green field airports of international standards at |
| but due to the Sino-Indian War of 1962 instead of | | | | Hyderabad and Bangalore has commenced and |
| agriculture the focus shifted towards defence and | | | | these are likely to be operational by middle of the |
| development. China war exposed the weakness | | | | year 2008. |
| of the economy. In 1965 - 66, the Green | | | | 8. The Survey recommends further liberalization |
| Revolution was started for the advancement of | | | | including allowing an associated coal mining |
| Indian agriculture. The wars lead to the rise in | | | | company engaged in captive mining to sell excess |
| price in India. Therefore the priority shifted to | | | | coal to the appropriate end-user, allocating coal |
| price stabilization. | | | | blocks for captive mining through price-based |
| Fourth Plan: During the early period of the plan, | | | | auctions and liberalization of FDI restrictions in joint |
| several droughts affected the economy. Indian | | | | ventures in captive mining. |
| Currency was devalued due to rising inflation. | | | | 9.The survey mentions that the total investment |
| Then an annual plan was introduced to resolve | | | | required in infrastructure is enormous and the |
| immediate problems, but still unemployment and | | | | Committee on Infrastructure, headed by the |
| poverty were major problems so this remained | | | | Prime Minister has estimated the investment |
| the focus of the plan. Another problem rose in | | | | requirements as Rs. 1,72,000 crore in the National |
| 1973 in form of the hike in fuel prices but the | | | | Highways sector by 2012, Rs. 40,000 crore for |
| focus remained unchanged. | | | | Airports by 2010 and Rs. 50,000 crore for Ports |
| Fifth Plan: 1974-79, Stress on employment | | | | by 2012. It is expected that a substantial share of |
| poverty removal and justice. Self-reliance with | | | | this investment is to come from the private |
| respect to agricultural production and defence. | | | | sector. |
| During the 4th and 5th plan, stress was on ratuinal | | | | 10.The Survey states that the policies and |
| minimum; but it was realized that still poverty | | | | institutions need to be geared up to meet the |
| plagued the nation. In 1978 the newly elected | | | | specific requirements of the infrastructure sector |
| Janta Government rejected the plan. | | | | in the country for which a well defined regulatory |
| Sixth Plan: 1978-1983, called the " Janta | | | | architecture has to be set up so as to increase |
| Government Sixth Five Year Plan " .The new | | | | the comfort level of different players in the |
| government rejected the "Nehruvian Model" of | | | | market. |
| economy and stressed on village and cottage | | | | Conclusion |
| industries ,natural mobilization of resources, so | | | | Countries who got their independence after 1947 |
| increase in employment . | | | | are already in the category of "Developed |
| Seventh Plan: 1980-1985, the comeback of Indian | | | | Countries" and we are much behind. I don't like to |
| National Congress Party into power. The stress | | | | justify this by giving reasons and excuses but |
| was on improving productivity level of industries | | | | yes, "Growing Population", Corruption at "High |
| by up-gradation of technology. | | | | Level" and "Attitude" of people has made all the |
| Eighth Plan: 1985-1990,Modernizations of industries, | | | | difference. We have still done well and we are |
| gradual opening of economy because of huge | | | | growing stronger with each passing day. My |
| deficit and foreign debt. The time period of | | | | heartiest CONGRATULATIONS to all my |
| 1989-91 was a time of political instability for the | | | | country-mates and people of India. Together we |
| nation hence no plan was being implemented | | | | will and we shall take this country on the roads of |
| Ninth Plan: 1997-2002 The target rate of growth | | | | success, growth and development. |
| during the plan is proposed to be 7%. India should | | | | Looking forward to your comments and feedback |
| be able to achieve it because sound base for | | | | With lots of love and care |
| rapid growth has already been laid in the country. | | | | Sanjeev Sharma (Himachali) |
| Tenth Plan: (2002 - 2007) The tenth five year | | | | E-mail: ; sanjeev. |
| plan gives more importance to empowerment of | | | | |