from the editor's desk · 2019-04-03 · dr. chetan bajaj dr. rajendra k sinha dr. rajashree...

A NATIONALMOVEMENTTO LAST BEYONDTOMORROW

IMPACT INDIA 2019 - Produced by IFIM Business School Supplement with Dalal Street Investment Journal Published : Alternate Monday (Mar 25, 2019) Pages 1 to 100 Apr 01 - 14, 2019

1

Supplement with Dalal Street Investment Journal Published : Alternate Monday (Mar 25, 2019)Apr 01 - 14, 2019

2

IMPACT INDIA 2019 - Produced by IFIM Business SchoolSupplement with Dalal Street Investment Journal Published : Alternate Monday (Mar 25, 2019)Apr 01 - 14, 2019

ifimbschool.com

3

Impact India 2019

Published by IFIM Business School

Supplement with Dalal Street

Investment Journal

Editorial Team

Atish Chattopadhyay

Dr. Chetan Bajaj

Dr. Rajendra K Sinha

Dr. Rajashree Pandiyan

Dr. Rema Gopalan

Dr. Pritam Ghosh

Rajarshi Chakraborty

Dr. Sangita Dutta Gupta

Dr. Nina Jacob

Dr. Satish Kumar

Dr. Mafruza Sultana

Forum Bhatt

Lumina Bose

Hemanth R Shankar

Pruthviraj Kulkarni

Maaz Ahmed

Vijaysingh B. Padode

Vikram Limsay

Sanjay Padode

Design: Print 2 Last Solutions

Produced by

IFIM Business School

8 P & 9 P, KIADB Industrial Area,

Electronic City Phase I, Bengaluru,

Karnataka 560100

Published by

Dalal Street Investment Journal

305, 3rd Floor, C-Wing,

Trade Center, North Main Road,

Near Axis Bank, Opposite Lane No. 6,

Koregaon Park, Pune - 411001

From polling stations 15,000 feet above the sea level to a voting outpost for a sole hermit deep in the forests of Western India, General Elections 2019 promises to be an unprecedented democratic saga, in the history of Independent India.

At $7 billion (approximately Rs. 500 billion), this democratic exercise is already being touted as the world’s most expensive. Around 900 million voters, from across the country shall exercise their political franchise and over 8,000 contestants would draw out their gauntlets to grab their share of the 543 pie.

Typical to India’s tryst of embracing plurality all at once, the multitude categories of voters, from the frigid deserts of Ladakh to the tropical backwaters of Kerala, aspire for and are united by a singular vision—that of economic development.

India’s economic report card under the NDA Government, between 2014-2019, can be highlighted by subdued inflation, higher & stable GDP growth and radical improvement in the ease of doing business. Of course, the Industrial Production (IIP) data and the issue of chronic NPAs that the Public Sector Banks are suffering from, are some of the indicators that may raise scepticism. But aren’t these also decades-long legacy issues that need structural shifts?

‘Make In India’, campaigns to curb black money, measures to increase transparency through legislation [the Insolvency & Bankruptcy Code (2016), the Coal Mines (Special Provisions) Bill, (2015), the Mines and Minerals (Development & Regulation) Act (2015), the Finance Bill (2018)] and most importantly, the promotion of meritocracy through sheer political will, have been some of the hallmarks of the government.

The NDA Government leveraged herculean efforts to enforce the G ST by July 1, 2017; a landmark reform that establishes ‘One Nation, One Tax’ in true sense of the term. Of course, it is also a befitting tribute to Atal Bihari Vajpayee. While on the one hand, India moves towards a monolithic taxation system, competitive federalism has thrived, with the states striving to attract more investments through reforms.

Modi’s diplomatic blitzkrieg (even if it were to go beyond protocol), in jugalbandhi with his resolve to establish direct connect with the ordinary citizens (through reforms), has charmed the political fraternity and the farmer alike. The deregulation of diesel, kerosene and fertilizer pricing, the Ujjwala Yojana, the Jan Dhan Yojana, the Samman Nidhi Yojana and Shram Yogi Mandhan Yojana, have benefited over 220 million individuals.

If anything, the NDA government has hinged on a sharp sense of purpose to promote inclusive socioeconomic development. While India decides its next government through the course of the summer 2019, it may be worthwhile to consider that whatever be the mandate, it is the mandate of the people. But perhaps, what India needs the most today, is the continuation of the current policies with a vigour characteristic of the past five years.

Sumantra Basu

From the Editor's Desk


ifimbschool.com

4

Director’s Note 06

Modus Operandi Develop India 07

Shifting Gear From ‘TalK’ to ‘Do’ 12

Leveraging Scaleable Solutions to Build Momentum for ‘Vision 2022’ 14

Forging a Sustainable Path to India’s Economic rise 20

Development Reaching Poorest, Ensuring Better Life for all 24

A Holistic Manufacturing Ecosystem for High Trajectory Growth 28

Ensuring ‘Sabka Saath, Sabka Vikas’ 32

Projecting India’s Soft Power Through AYUSH 39

Boosting MSMEs Sector Through High Powered Reforms 42

Services Sector in India: A Story of Dynamic Growth 48

Swachh Bharat: Ensuring Cleanliness & Dignity for Ordinary Citizens 52

Modicare 55

Chalking a Strategic Roadmap to Provide Housing for all by 2022 58

Financial Inclusion 64

Creating Holistic Policy Environment to Boost Agriculture 68

Through Policies, Schemes for Minorities and Special Groups 72

Digital India: Building a Digital Infrastructure for India 74

Ushering a New India Through Policies Focused on Youth Development 80

Boosting Services Sector 87

Reversing Brain Drain and Harnessing Yuva Shakti for India 90

Leveraging Conscious Capital in Education Sector 96

C o n t e n t s

5Supplement with Dalal Street Investment Journal Published : Alternate Monday (Mar 25, 2019)Apr 01 - 14, 2019


ifimbschool.com

6

Director's Note

Considering the contemporary Indian political

discourse, it won’t be an exaggeration to say that

in the Indian parliamentary democracy, the Prime

Minister’s position today is like the CEO of the

Nation who the people of the nation appoint (rather elect),

making this the most important position in the country. With

the oncoming general elections for the 17th Lok Sabha, we

are set to evaluate the incumbent CEO and either give him a

second term or elect a new one.

The job of the CEO is to deliver on certain parameters/promises for an organisation and be assessed on those parameters/promises. Similarly, a nation’s CEO needs to deliver on the promises made while presenting her/his candidature before assuming the office and be assessed by those who appointed him (the electorate, in this case). It is important that the CEO’s performance is assessed against key metrics and the future deliverables of the CEO need to be known by the people who have appointed that CEO.

So far, a dashboard hasn’t been created for the CEO of the nation. The question is whether we need a dashboard based on which the government and the Prime Minister can be assessed? I believe, we must! – somewhere the process needs to begin to document the impact in terms of delivery of the promises made.

As the government completes its tenure and the largest democracy of the world is gearing up to elect and appoint its new CEO, we, as at IFIM Business School, wanted to take stock of how the metrics look like. We wanted to give this a start and we hope that this will lead to a discussion on what should be the dashboard to assess the CEO of the nation. That is also very contextual because the metrices that are important for a developing nation like India will be very different from the ones needed for the countries of the developed world.

We have looked at certain specific areas of governance and their impact, namely Government’s Work Ethics, Scalable Solutions, Sustainable Economic Growth, Inclusive Development, Manufacturing Ecosystem, Youth and Sports, MSME Reforms, Services Sector, Swachh Bharat, Comprehensive Healthcare, Financial Inclusion, Agriculture Policy, Schemes for Minorities and Special Groups, Digital India, Employment Opportunities, Reverse Brain Drain and Conscious Capitalism.

Our faculty have tried to understand how the government has delivered on these key areas of focus. I thank my colleagues Dr. Chetan Bajaj, Dr. Mafruza Sultana, Dr. Nina Jacob, Dr. Pritam Ghosh, Mr. Rajarshi Chakraborty, Dr. Rajendra K Sinha, Dr. Rema Gopalan, Dr. Sangita Dutta Gupta, and Dr. Satish Kumar for making an effort which can be a starting point for the electorate to take a conscious decision.

I am also thankful to Mr. Vikram Limsay and Mr. Sumantra Basu for their articles. I thank Mr Sanjay Padode for his contributory piece and for supporting in this initiative. I am grateful to Shri V B Padode, Chairman of IFIM Business School for his blessings as well as the contribution to this publication.

We expect to come out with a publication like this each time a government is to be elected and the CEO of the nation is to be appointed. We hope that we will be able to come out with a dashboard outlining the key metrics and to assess the performance of the government against those metrics, going forward.

Atish Chattopadhyay, PhD Director IFIM Business School, Bangalore


ifimbschool.com

7

Leaders have come and gone in the 72 years history

of independent India. The Indian economy has fought

battles to protect its borders and against poverty for

keeping its population alive during this period. The

economy reached the verge of bankruptcy and survived by

forced liberalizing its economy. The liberalization was a boon

and the bankruptcy seemed to have been god sent as it set

the economy in motion.

The economy broke out of its Hindu growth rate and

started to cause a stir in the global arena. The power of the

demographics, values and intelligence was unleashed as

entrepreneurs stepped on the accelerator and the brain drain

began to reverse. However as is evident all this happened

because it had to happen. All of this could have been better

managed if the development of our economy was devoid of

personal agenda and focused on building a direction aligned

to a mission which never existed.

This was to change as BJP found its foothold in the

Modus Operandi Develop India

Vijaysingh B. Padode

CHAIRMAN CENTRE FOR DEVELOPMENTAL EDUCATION (CDE) SOCIETY

beginning of the 21st century. The then Prime Minister

demonstrated their mission for making India a super power

and an integral part of the developed world. The government

laid out its agenda for infrastructure development and

strengthening of its resolve to fight the powers that were

weakening the nation. Unfortunately, another decade was

lost as a directionless government came to power.

Fortunately, the seeds of development were sowed, and

the agenda continued its momentum without any impetus

from changing policies and governmental interventions. The

elections of 2014 again established the aspirations of the

world’ largest democracy as development by providing a

sweeping majority to the NDA.

Modi known for his singular focus on developing India was

elected as the Prime Minister and a new era dawned. He not

only pushed the machinery towards development, provided

a clear direction to the nation that black will be punished

and white will be cherished. He established to the world that

India exists and that the world needs India more than India

needs the world. His Modus Operandi for Developing India

consisted of 3-point action agenda

1. Position India

2. Clean India

3. Make India

Position India

Prime Minister Narendra Modi proved himself to be as

comfortable on the global stage as at home. Modi’s

foreign diplomacy has been one of the key highlights of his

government and his diplomatic outreach has reached far and

wide in the last four years. Indian’s global presence is said to


ifimbschool.com

8

have become stronger since Prime Minister Modi came to

power.

Ergo, Modi has been accused by foreign policy wonks of

conflating action with achievement. He has succeeded in

making significant steps with neighbors like China, evidenced

by the settlement of the Doklam standoff, which was

threatening to snowball into a major armed skirmish.

However, Modi’s Pakistan policy and his overtures of peace,

including an impromptu visit, did not pay off as Pakistan

was not yet ready for development and was trying to resolve

its own governance battles between its armed forces and

the democracy. At the UN General Assembly, Modi said he

was prepared to engage in a serious bilateral dialogue with

Pakistan in a peaceful atmosphere, without the shadow

of terrorism, to promote friendship and cooperation.

Pakistan must also take responsibility for creating the right

environment.

About twenty years ago, world leaders used to call Kashmir

a “law and order problem”, he lamented, suggesting

only now had they come around to understanding India’s

concerns. “Some countries are giving refuge to international

terrorists,” he said. “They consider terrorism to be a tool of

their policy.” Modi called for collective responsibility and said,

“Let us bring ourselves in tune with the call of our times,” he

said, pointing out that the world was witnessing tensions and

turmoil on a scale rarely seen in recent history.

No single country can determine the course of the world.

There had to be a genuine global partnership. That was not

just a moral position, but a practical reality. Putting aside

differences, member states should mount a concerted effort

to combat terrorism and extremism, he said, urging them

to adopt the Comprehensive Convention on International

Terrorism. His first attempt has always been to extend a

warm and friendly hand to the neighbors of India and this

was evident from the invitations that he sent out to the heads

of neighboring countries during his swearing in ceremony

and by his strategic actions of inviting the heads of state to

attend our Republic day celebrations.

Modi also visited China, Germany and Russia four times

in four years. Relations between Indian and China have

strained since the Doklam issue arose and these meetings

have defined the two countries’ relationships. Modi was one

of the first to congratulate Xi Jinping when he was re-elected

as the president of China. Modi’s informal summit with

China’s president Xi Jinping in Wuhan on April 27-28, 2018,

is yet another example of harnessing the personal touch

in diplomacy to further Indian’s interests and strengthen


ifimbschool.com

9

relations with the world at large. Today he is seen as a force

that is uniting the world against terror.

Clean India

Modi was the first leader who conceded that India was dirty

and needed to clean up to be truly incredible. The potential

of India would make itself apparent as soon as the hygiene

and sanitation is taken care of. This was taken literally by

him when he addressed the need for India to become open

defecation free and also when demonetized the currency to

get rid of the dirt money in the system.

As part of Swachh Bharat Abhiyan, Modi aimed to achieve

an open defecation-free India by the 150th anniversary of

the birth of Mahatma Gandhi, i.e. October 2, 2019. Open

defecation has always been a major problem in India

where one in ten individuals practices open-defecation.

His Government pushed construction of toilets and also

campaigned extensively for developing a hygiene conscious

attitude amongst the nation’s populace.

The cleanliness drive extended beyond toilets to the holy

river which is believed to cleanse people of their sins. The

National Clean Ganga mission delivered on its promise at the

Ardh Kumbh 2019. The organisation and the efforts of Clean

Ganga Mission were evident at this grand event.

Cleaning India mission of Modi extended to the policies

of business. He made extensive efforts to drive the policy

makers to simplify laws and regulations to make India climb

in the Doing Business rankings. Delays and red tape that

existed due to the convoluted structure of policy framework

dropped drastically to make India a more business friendly

country.

In 2016, the Lok Sabha repealed 1,175 of 1,827 laws

identified as obsolete, and many other steps were taken


ifimbschool.com

10

to make lives of common man easier. From self-attestation

to doing away with birth certificate for passport to tatkal

reforms, to easing I-T filing, these reforms went unnoticed in

the four years of Modi-led NDA government.

Modi demonstrated his propensity for meritocracy by

nailing many who had taken the system for granted for their

personal gains. He ensured that the government machinery

chased such fugitives in foreign land to bring them to justice.

He brought in greater transparency to award those who

contributed to the development and growth of the nation by

cleansing the politics around the coveted Padma awards

conferred by our Nation.

Make India

It’s a no brainer that the best action for fueling any country’s

economy is to build infrastructure and create livelihood for

the bottom of the pyramid. Modi accelerated the pace for

development of highways, encouraged the BJP run states

to build Metro networks in cities and major towns, put

into motion the lethargic machinery of the government to

complete infrastructure projects, promulgated schemes such

as Skill India, Make in India and Digital India.

Leveraged his well-established friendship with Japanese

prime minister Shinzo Abe to secure concessional financing

for his dream project –the bullet train - and the civilian

nuclear deal. Cracked the whip on the banks to behave

responsibly and lend to the genuine entrepreneurs and wean

away from the cronies of the past.

Fast forwarded the new bankruptcy code to help banks

recover their dues and rejuvenate their balance sheets for

funding the growth of India. Fast tracked the disinvestments

in the PSU’s to raise capital for funding the fiscal deficit.

Accelerated the introduction of the GST to streamline indirect

taxation for fueling trade across various states and for

reducing the drag on business. GST also helped reign in the

prevalent corruption in the now defunct taxation authorities

and departments.

At the international level besides establishing an image as

one of the best statesman of the decade globally, Modi

government’s trade policy were appreciated as the country

reduced tariffs ceding ground beyond the World Trade

Organization’s demand.

The Make in India agenda of Modi is holistic and inclusive.

The economic growth of the nation had to be balanced

by improving the quality of life for the citizens of the

country. Modi knew very well that sustenance of growth

and prosperity can only be attained by uplifting happiness

quotient of the demography. He demonstrated his conviction

towards women’s empowerment by easing the maternity

benefits of women and he passed an ordinance against the

Triple Talaq legacy.

His Jan Dhan Yojana pushed the banks to open more than

300 million bank accounts to enable the government to

transfer direct benefits and disengage the clutches of the


ifimbschool.com

11

middle men and defeat the corrupt who were continually

exploiting the inefficiencies of the legacy system. He

introduced the National Health Protection Scheme (NHPS)

for enhancing the health of the country.

His schemes for reaching piped gas and cooking gas to

homes of seven crore people of India relieved many women

from the daily suffering of inhaling the smoke from firewood

and coal. The direct transfer of Rs 6,000 annually to the

small farmers is a true expression of his intent to fuel the

agri-economy without disrupting the banking system.

Rural electrification has been a major policy success.

Without last-mile connectivity, many villages were without

power, and the pace of rural electrification has been quickest

in Indian’s history. Thepace of airways and waterways has

been another outstanding success. His dream for providing a

roof to every person in India reflects a holistic vision backed

by a detailed and balanced thought process.

Modi slogged 24 hours and 365 days. He did not take a

single leave during his entire tenure. In spite of this grueling

schedule, he knew that there is no replacement for leading

by example and he did propagate the practice of yoga as a

panacea for longevity and health. He was also instrumental

in getting UN to declare a Yoga Day pushing India back into

thought and action leadership position globally.

When the whole academic world in the country had

practically given up on education reforms, Modi’s

government announced the Institution of Excellence,

Graded Autonomy amongst Universities and Institutions.

These policies were applauded by the intelligentsia

as these would bring the lost glory back to the

scholarly pursuits of the country and would surely

propel our universities across the various international

ranking.

The government’s commitment to transform 10 public and

private educational institutions into world-class ones further

corroborated the intent of making India a destination for

knowledge creation and dissemination.

Modi believes youth power is the answer if the 21st century

will be that of India or China. He understands the need to

equip these youngsters with adequate skills and at the

same time giving dignity to each and every skilled

professional.

To attempt so much in five years is itself an outstanding feat,

Modi pursued his intent relentlessly till it became action. The

journey for delivering all of the above was

further compounded by the efforts of the opposition and their

cronies but Modi was unstoppable. His tenacity to deliver on

his singular promise of “Achche Din” has been

well established by his action and there remains no doubt

that he is a patriotic leader who is fully committed to develop

India.


ifimbschool.com

12

A most conspicuous and discernible positive change

in the last five years of the Modi Government

is the change in work culture and the way of

doing things. Suddenly the entire governance

mechanism, at least at the centre, seems to have shifted

gears from a “talk” to “do” mode. And the good thing is

that this culture seems to be seeping down the pyramid. It’s

not uncommon now to find even corporators at the local

government level getting more execution oriented.

For far too long status quo has been the norm. It was

expected and sadly even accepted that that matters of

governance and policy will move at a snails pace and

execution would be of minimal priority. This was the

entrenched culture. Projects would be announced, ribbons

would be cut and foundation stones be laid with pomp and

fanfare with an utter disregard to any thought of completion.

This complete lack of accountability, delayed half done

projects and dismal execution not just resulted in frustration

Shifting Gear From 'TalK' to 'Do'

Vikram Limsay

CEO & PRINCIPAL CONSULTANT HELICON CONSULTING

Changing the paradigm of work culture in government

and hopelessness amongst people but over the years even

impacted macro-economic indicators making ours a laggard

economy in spite of all the inherent dynamism of its people.

Colluding economists even invented the derogatory term

“Hindu Growth” rate to put an official stamp of approval on

the results of this work culture.

All that has thankfully changed in the last five years. The

language and the manner of doing business has become

target driven and accountability led. Narendra Modi who

has led this initiative to change the paradigm of work culture

has been helped in his cause by brilliant no non sense

execution oriented ministers. Stellar amongst them being

Nitin Gadkari, Piyush Goyal, Suresh Prabhu, Late Manohar

Parrikar, Rajyavardhan Rathore, Kiren Rijuju, J P Nadda and

the likes. Perhaps the culture emanates from the ethos of a

cadre based party with its roots in RSS where recognition

is for work, delivery and effectiveness and not for lineage.

The same culture can be seen even at the party organization

level with Amit Shah and a slew of chief ministers like

Devendra Fadnavis , Yogi Adityanath and others who talk

delivery and effectiveness as a habit.

Age is another criteria that drives this paradigm shift. Mr

Modi has selected a bunch at the central and state level

largely in late forties and early fifties that has the right mix of

energy driven by youth and experience driven by age.

The language of public discourse has changed. Even

common folk want to speak in terms empirical and

quantifiable indices. KM of roads laid per day, villages

electrified per week, number of accounts opened, number

of surgeries done under Ayushman Bharat etc. are common


ifimbschool.com

13

kerbside discussion drivers. Target vs achievement is

the call. In that sense the government has become more

business-like with Narendra Modi acting as its CEO with

a perform or perish environment such that accountability,

execution and delivery is paramount. And yes performance

has been rewarded, classic case being of Piyush Goyal who

has been given additional charge of several sectors while

some have even perished in this high pressure pace set by

the Prime Minister. While this changing paradigm of work

culture can be felt all around the ground level change will

take some time to be seen. Hope we are all patient enough.

Sometimes totally un connected areas are available for

the government to showcase and exemplify its ability in a

modular format. The Kumbh Mela was one such opportunity

and the government grabbed it with both hands to

showcase to the world what their new work ethic can deliver.

Over 30 Crore landed up in Prayagraj over fifty days and the

organization that the government displayed was epic and top

class. Infrastructure, roads, railways, security, cleanliness,

logistics every area was handled professionally and to the

best standards. If the Kumbh Mela organizing was any

showcase of this paradigm shift then we as a country are

sure in for great times in future with this new work culture.

Naysayers will always be there but they need to be

discounted. As is there wont, the most common rant was

to point out projects that were started by them many years

earlier. But that precisely is the point. The project was never

a priority. The concomitant grandstanding was and soon the

foundation stone would be covered by weeds. There are

innumerable such projects which had decayed even in the

memory of people. This government brought a closure to

many such incomplete ones as result of the changed work

ethic. The list of such incomplete projects is endless. The

Bogibeel Bridge in the East, The Chenani Nashri Tunnel in

the North, The Kollam Bypass in South, The Ro-Ro Ferry

Service in West are all examples of projects completed

because of this execution oriented work ethic.

These slow moving projects and a status quo led work

culture was not just blocking expensive public money but

was also testing public patience resulting in all around

hopelessness amongst the people about the potentiality of

India.

That thankfully has changed now and is the biggest

contribution of the Narendra Modi Government. Changing

the paradigm of the Governments Work Culture


ifimbschool.com

14

I have a milestone of 2022 when India completes 75

years of Independence. We all should take a pledge,

of something good that we want to contribute to the

country and promise to fulfil that pledge by 2022”, said

Prime Minister Narendra Modi, in March 2017, unveiling his

plans for a New India at the BJP party-workers meet in New

Delhi, in March 2017.

India economic development post 1947 until 1989, was

slow. A matter of point being that India and China were

equally poor countries, during their independence. While

China embarked on an aggressive path towards economic

development especially since the 1970s, India remained

stuck in a 2-3% GDP growth (famously touted as the Hindu

rate of growth) for decades, dogged by licence Raj and a

hyper-socialist mindset.

Leveraging Scaleable Solutions to Build

Momentum for 'Vision 2022'

“

dr. Chetan Bajaj

PROFESSOR - MARKETING, IFIM BUSINESS SCHOOL

In 1990-91, the government, under the Premiership of

PV Narasimha Rao, unleashed a plethora of reforms that

liberalized the economy, by harnessing the power of free

markets and privatization. The reforms witnessed a huge

influx of multi-nationals coming into the country, while at

the same time, encouraging a new breed of entrepreneurs

to spring up and tap into the promising potential that India

harnessed.

The years between 2008 to 2014 were marked by a tepid

growth outlook as a result of the global financial crisis and a

political inertia back home. The other turning point in India’s

economic fortunes came in 2014 elections as the BJP won a

majority mandate, the first such after a span of almost three

decades.

Narendra Modi, with a proven credential of transforming the

enterprising state of Gujarat into a model-state, took over as

the Prime Minister of India. An administrator with a penchant

for accelerated, focused reforms, Modi unleashed fresh

thinking and most importantly, unshackled the bureaucracy.

The Prime Minister stepped in where it mattered the most—

ensuring transparency, fairness and quick decisions. Be it

creating an amended framework for the transparent auction

of minerals, prepping up manufacturing or advocating for

a Swachh India, Modi wholeheartedly focused on creating

well-engineered reforms that kicked off a chain of credit

positive, GDP accelerating events.

While traditionally one of the most promising Emerging


ifimbschool.com

15

Markets, as suggested by the BRICS acronym, coined by investor

Jim O’ Neill (then with Goldman Sachs), India’s faded sheen

among the global investment community began to resurface.

By 2017, India had overtaken China as the fastest growing major

economy in the World. While on the one hand, the mantra of

inclusive growth and a strong domestic consumption story pegged

the GDP on a strong wicket despite a tepid global outlook, critical

indicators such as the Ease of Doing Business Index and credit

upgrades by the sovereign ratings agencies went on to prove the

India’s fundamental story was intact and in fact getting better.

Modi Government came to power in 2014 with an express

mandate of increasing the rate of economic growth and ensuring

financial inclusion, through equitable distribution of income across

the lower income segments.

The years 2014-2018, have witnessed massive and

unprecedented improvements in infrastructure facilities with huge

increase in road network, railway connectivity, electrification,

provision of drinking water and sanitation facilities.

‘Housing for All’, which had remained an utopian dream for long,

has become a reality. The tax base has widened owing to the

introduction of the Goods and Services Tax (GST) and transparent

accounting practices, enforced through legislative amendments.

An unprecedented number of individuals are connected to the

mainstream banking system.

Before 2014, only 56 % of India’s six lakh plus villages were

connected by roads. The people living in remaining 44 % villages,

did not have access to roads and were cut off even from basic

education and healthcare facilities. If there is a single-most

indicative metric that could define the sheer grit to execute

infrastructure development, the NDA government’s impressive

record of developing roadways stands tall by a huge margin

as compared to the previous governments. It hardly comes as

a wonder then, that by 2018, over 82% of the villages were

connected by roads.

The average speed of construction of rural roads had increased

dramatically, from 69 kms per day in 2013-14, to 134 kms per day

in 2017-18. Most of Rural India now have access to rest of the

country.


ifimbschool.com

16

The speed of highway construction has also increased over

two-fold from only 12 kms per day in 2013-14, to 27 kms

per day, in 2017-18. The National Highway Network has

increased from 92,851 kms in 2013-14 to 1,20,543 kms

in 2017-18. The total length of all roads is now about 3.3

million Kms. Over the next five years, the government plans

to build 83,677 kilometers (km) of roads by spending a

staggering Rs7 lakh crore ($108 billion). This is the largest-

ever outlay for road construction in India.

Railways is the backbone of India’s transport infrastructure,

both in terms of movement of people and goods. Before

2014-15, India’s rail network was growing at a snail’s pace.

In the five years between 2009 to 2014, only 7,600 kms of

Broad-Gauge lines were commissioned.

The development of comprehensive rail network gathered

momentum within the first year of NDA’s tenure in 2014. In

a span of just 4 years (2014-18), as much as 9,528 kms of

Broad-Gauge lines have been commissioned, about 2,000

kms more than during the UPA rule of 5 years, between

2009 and 2014.

During the last three years of UPA regime between 2011

to 2014, track laying suffered and fell behind targets. Track

renewal shot up by over 50% from only 2,926 kms in 2013-

14 to 4,405 kms in 2017-18.

In the three years, 2013-2014 to 2017-2018 the track

renewal has been 11.5% faster than during the last three

years of UPA rule and exceeded targets by about 13 %. The

track renewal of 4,405 km of old rails in 2017-2018 has been

the highest ever. The previous best track renewal was 4,175

km in 2004-2005, when a rehabilitation plan was finalized,

with a total fund outlay of Rs 17,000 crore.

The railways have gained notoriety for accidents, as the

institution grossly ignored safety. In 2013-14 there were

118 consequential train accidents. This went down very

substantially, to just 72 consequential accidents, in 2017-18,

a reduction of 62%.

As an agrarian economy, the countryside is pretty much

at the epicenter of affairs. Dynamic initiatives by the

NDA government between 2014-2018, have completely

transformed the face of Rural India. There has been huge

improvement in sanitation facilities, with construction of

toilets in each household.

Rural electrification is almost complete, roads have reached

the remotest rural villages, concrete, brick and stone houses

are being constructed at a rapid pace and Optical Fiber

cables have provided Digital connectivity, to the large rural

hinterland.

Poor Sanitation facilities and lack of toilets in rural

households had contributed greatly to spread of diseases.

Hence, construction of toilets in rural households, was the

prime focus of the Modi Government. Over a period of 67

years, from India’s Independence in 1947 to 2014, only

6.5 crore toilets were built in rural India. Between 2014-

2018, over 7.25 crore toilets have been built in rural India.

A tremendous growth, this has resulted in huge increase in

sanitation coverage in rural India from just 38.70% to 83.71

% in just four years.

To take the initiative forward, the Ministry of Urban

Development has decided to give every household without

a toilet, Rs 4,000 to construct a toilet, with an additional

incentive share of Rs. 8,000 from the state government

under the Swachh Bharat Mission.

Digital connectivity as stated earlier has seen a

marked improvement under the NDA government.

Telecommunication and Internet connectivity, in rural areas

over the last four years, is the best example of this.


ifimbschool.com

17

Between 2011-2014, only 59 Gram Panchayats were

connected by optical fiber. The number of Gram Panchayat’s

connected with optical fiber shot up dramatically to 1.15

lakhs between 2014-2018. Similarly, the number of common

service centers in rural India, shot up from just 83,000 pre-

2014, to over 2.92 lakhs in 2017.

India is gearing up for a massive digital transformation of its

vast hinterland. The government has launched BharatNet,

a flagship program that will provide broadband connectivity

across India’s villages, by 2019, —at a cost of Rs. 34,000

crore.

The first Phase of BharatNet was completed by December

2017 and covered 100,000 Village Panchayats. By 2019,

the Government plans to lay one million kms of optical fiber

network—to bring digital connectivity to all the 2,39,000

Panchayats.

The National Optical Fibre Network (NOFN) is an ambitious

initiative to trigger a broadband revolution in rural areas.

NOFN was envisaged as an information super-highway

through the creation of a robust middle-mile infrastructure

for reaching broadband connectivity to Gram Panchayats.

NOFN aims to connect all the 2,50,000 Gram panchayats

in the country and provide 100 Mbps connectivity to all

these Gram Panchayats. To achieve this, the existing fibres

of PSUs (BSNL, RailTel and Power Grid) were utilized and

incremental fibre was laid to connect to Gram Panchayats

wherever necessary.

Non-discriminatory access to the NOFN was provided to all

the service providers like Telecom Service Providers (TSPs),

ISPs, Cable TV operators and Content providers to launch

various services in rural areas. The NOFN project was funded

by the Universal Service Obligation Fund (USOF). Based on

NOFN experiences, newer, updated and upgraded version

of BharatNet was conceived, as a nation-wide broadband

network.

In 2014, when the NDA took over the reins of the

government, the World Bank reported that India had the

largest un-electrified population in the World. In 2015,

an audit identified 18,452 villages, without electricity.

Accordingly, DeenDayal Upadhyaya Gram Jyoti Yojana was

launched, under which every village in the country was to be

electrified, within 1,000 days.

On April 28, 2018, Leisang, a tiny hamlet in the remote

northeastern state of Manipur, was connected to the grid,

exactly 988 days thereafter, electricity had reached all the

villages in India—a remarkable achievement indeed in a

comparatively short span of time.

In 2014, over four crore homes in rural India did not have

access to electricity. The government has launched the

Saubhagya programme, with a total outlay of $2.5 billion, to

provide power connections to every household by the end

of March 2019. Under the programme to achieve 100 %

electrification target by March 31, 2019, a staggering 2.03

million new households, have to be provided with electricity

connections, every month.

March 31, 2019 will mark the dawn of a new era, when every

household in India, will have access to electricity. The World

Bank has now lauded India’s effort on electrification, in its

latest report on Energy Progress.

The Government has also been committed to the efficient

use of energy through greater usage of LED Bulbs which are

very energy efficient and economical in the long run. It has

subsidized distribution of LED bulbs to the rural and urban

poor.

Over 90 Crore LED bulbs have been distributed over the

last four years, 30 crores by the government sector and 60

crores by the private sector. Usage of LED bulbs has resulted

in total savings of over Rs. 40,000 crores to consumers,

every year.

In 2015, Prime Minister Narendra Modi announced the

‘Housing for All by 2022’. The erstwhile Indira Awas Yojana

was re-nomenclated as the Pradhan Mantri Awas Yojana

Grameen, and another scheme Pradhan Mantri Awas Yojana

Urban, was launched in 2015. Under both these schemes a

total of 50 million houses have been targeted to be built by

financial year 2022, including twenty million in urban areas.


ifimbschool.com

18

The government’s budgetary support for these schemes has

risen from Rs 11,600 crore in FY16 to Rs 29,043 crore in

FY18. Over the last four years, 2014-2018, almost one crore

houses were constructed in Rural and Urban areas. This is a

record for construction of houses.

Housing for all remained a remained an unachievable wish

since the country’s Independence in 1947. There are a

plethora of reasons for this. Acquisition of land in urban areas

at an affordable price has been difficult; this combined with

inadequate infrastructure and a lengthy approval process --

has made the progress very tardy.

But the Modi government is taking the bull by the horns and

taming it. First, it is giving a subsidy of the 6.5 per cent at

the lowest rung of the ladder. Secondly, it is crediting the

entire subsidy of a 20-year loan, to the loan account of an

applicant, which reduces EMI, thus making it more affordable

to the applicant. Thirdly, they have allowed withdrawals from

the Employee Provident Fund Organization (EPFO) to the

extent of 90 per cent of the amount, for housing, in case

there is a group of eight other people, who are doing so, for

a house, in the same society.

The Government has also announced following schemes and

incentives to promote growth in the housing sector:

●● Affordable housing has been granted infrastructure

status, giving developers access to cheaper sources

of funding, including external commercial borrowings

(ECBs).

●● Promoters of affordable housing have been granted

more time for project completion. The deadline has

been increased from three years to five years.

●● Developers will get a year’s time to pay tax on

notional rental income on completed but unsold units.

The tenure for long-term capital gains for affordable

housing has been reduced from three to two years.

●● • The qualifying criteria for affordable housing have

been revised to 30 square meters and 60 square meters

on the carpet, rather than the saleable area, for metros

and non-metros respectively. This effectively increases

the size of the affordable housing market across India.

●● To augment the sops announced in the budget, a

new Credit Linked Subsidy Scheme (CLSS) for the mid-

income group was announced with a provision of Rs

1,000 crore.

In India, the number of income tax payers are a small

percentage of the total population. Many people evade

taxes and do not file Income Tax Returns (ITRs). The Modi

government had come to power with a strong commitment

to unearth the huge amount of black money in the economy

and pump it in the mainstream economy for productive

purpose.

This becomes essential to raise funds for developmental and

social expenditures. The government has also given high

priority to increase tax compliance, by bringing more people

under the tax net and thus diversify the tax base.

Two major initiatives by the Modi Government to unearth

black money and improve Tax compliance have been

demonetization and implementation of the Goods and

Service Tax (GST). These initiatives have been hugely

successful in drawing out the black money and improving

India’s tax compliance.

The number of total registered tax payers in India in Pre

GST-era, before 2017, was only 65 lakhs, a very small

fraction of total population. Post implementation of GST It

grew very substantially, to over one crore, an increase of over

50%. This shows the great success achieved by the NDA

government, in widening the tax net.

Similarly, the number of Income Tax Returns registered a

phenomenal 80.5 % jump from just 3.79 crores in 2013-

2014, to over 6.84 crores in 2017-2018. Net Income

Tax collections in 2017-2018 crossed Rs. 10 Lakh crore,

recording an increase of over 18 % compared to 2016-2017.

On a clarion call from the Prime Minster, over 5.5 Million

Consumers have also given up their cooking gas subsidy

that has saved the government Rs. 900 crore.


ifimbschool.com

19

Rapid and equitable economic growth has been the prime objective

of the Modi Government. One of Modi Government’s most dynamic

and successful initiatives has been “Pradhan Mantri Jan-Dhan Yojana

(PMJDY)”. This initiative leverages technology to ensure that most

deprived and excluded sections of the society have basic savings bank

account and access to various financial services, including need-based

credit, remittances facility, insurance and pension facility.

In a way, PMJDY is a National Mission on Financial Inclusion. Every

beneficiary would get RuPay Debit card having in-built accident

insurance cover of Rupees one lakh. The plan also envisages

channeling all Government benefits (from Centre/State/Local Body) to

the beneficiary’s accounts and promoting the Direct Benefits Transfer

(DBT) scheme of the Union Government. Technological issues like poor

connectivity, are being addressed to make PMJDY a roaring success.

On August 28, 2014, the inauguration day of PMJDY, over 1.5 crore

bank accounts were opened. A record 18,096,130 bank accounts

were opened between August 23-29, 2014. On 20 January 2015, the

scheme entered into Guinness book of world records for the most bank

accounts opened in one week.

By September 2018, over 31.52 crore (315 million) bank accounts were

opened, which is equal to the population of USA and over `792 billion

(US$12 billion) were deposited under the scheme. Now, every family

in India boosts of a bank account, opened under Jan Dhan scheme.

Social Security was made a nation-wide Phenomenon with Jan

Suraksha. Under this scheme more than 19 crore people were insured

against Life and accident risks or assured of pensions.

The successful Implementation of all developmental programs initiated

by the Modi Government will change the face of India. The General

Elections 2019 are a critical juncture that shall decide India’s future

growth trajectory and its path towards a sustainable development.

If the NDA government comes back to power the scale and speed of

change will further accelerate. Infrastructure Projects of massive scale,

such as Bullet Trains and Smart Cities will see the light of the day. India

will become the manufacturing hub of the world. Digital India will have

become a reality. Unemployment would be at an all-time low. The huge

manpower of this country, which constitutes the largest work force in

the World, will have helped India emerge as one of the most dynamic

economies in the World and a powerhouse for the Global Economic

Growth.


ifimbschool.com

20

We have taken several important decisions

associated with reforms and the government

will continue to do so. Steps are also being

taken to maintain the financial stability of

the country and to increase investment and to speed up

economic growth”, said the Prime Minister Narendra Modi

in October 2017, listing out the achievements of the Modi

government.

The aftermath of the global financial crisis of 2008 was

marked by a prolonged phase of tepid economic growth,

dimmed prospects across the emerging and frontier markets

and an even gloomy story for the advanced economies.

Even the global driver of economic growth, China, began to

falter.

While India caught a slight flu, strong domestic consumption

and sound fundamentals, akin to an aspirin, kept any dip in

check. The Global Economic Prospects report (June 2018)

Forging A Sustainable Path To India's Economic Rise

dr. rajendra k sinha

“

too documents the global economy seems to be leaving the

legacy of the Great Recession behind.

Given the robust global economic growth, global GDP

growth has been projected around 3.1% in 2018 before

its gradual slowdown over the next two years. For the first

time from 2010, the long-term (10-year-ahead) consensus

forecast for global growth appears stabilized.

On India’s growth rate projection next fiscal, the ADB said:

“Growth in FY 2018-19 is expected to rise to 7.6% as

measures to strengthen the banking system bolster private

GDP Growth Rate (at current prices): 2013-2018

India’s GDPcurrent prices): 31%

World GDP 4%

PROFeSSOR & CHAIRPeRSON, CeNTRe FOR eXCeLLeNCe IN BANKING, IFIM BUSINESS SCHOOL


ifimbschool.com

21

investment and as benefits kick in from GST. Any further

increase in oil prices poses a downside risk to growth.”

The CII ASCON Q1FY19 survey tracks sectoral growth

through responses garnered from sectoral industry

associations. On the production front, some sectors shall

witness a steady growth in the foreseeable future. For

instance, the automobile industry has continued to dominate

the export scenario as well.

The services sector is not only the dominant sector, but has

also attracted significant foreign investment, and contributed

to exports and generated large-scale employment. India’s

distinctive competencies and competitive advantages

formed by knowledge-based services make it an emerging

market. The services sector has the potential to unlock

immense opportunities.

The production of food-grains in 2017-18 was 284.83 million

tonnes (third advance estimate), compared to 265.04 million

tonnes in 2013-14. GDP from Agriculture in India averaged

INR 4,057.73 billion from 2011 onwards, reaching an all-time

high of INR 5,666.82 billion in the fourth quarter of FY 2016-

17, and a record low of INR 2690.74 billion in Q3 of 2011.

The value of merchandise exports and imports increased

17.6% and 21.3% respectively in USD terms in June 2018

over June 2017. Forex reserves stood at USD 400.10 billion

as in August 2018.

Going forward, merchandise exports rose 19.2% year-on-

year in August 2018, though India’s trade deficit widened to

USD 17.39 billion from USD 12.72 billion in the same month

a year earlier, it compared with the market expectations of a

USD 17.25 billion gap.

While retaining India's projected growth rate for the current and the next fiscal year,

China 1 25,239 18.7 37,067 1 6.86 2 14,093 16.1 21,574 2 6.86

United States 2 20,413 15.1 24,537 2 2.27 1 20,413 23.3 24,537 1 2.27

India 3 10,385 7.69 16,785 3 6.74 7 2,848 3.25 4,663 5 6.74

Japan 4 5,619 4.16 6,358 4 1.71 3 5,167 5.9 5,962 3 1.71

Germany 5 4,374 3.24 5,171 5 2.51 4 4,211 4.81 5,272 4 2.51

Russia 6 4,169 3.09 4,933 7 1.55 11 1,719 1.97 1,974 12 1.55

Indonesia 7 3,492 2.59 5,033 6 5.07 16 1,074 1.23 1,549 16 5.07

Brazil 8 3,389 2.51 4,168 8 0.98 9 2,138 2.44 2,717 8 0.98

United Kingdom 9 3,029 2.24 3,598 9 1.79 5 2,936 3.36 3,477 7 1.79

France 10 2,960 2.19 3,544 10 1.85 6 2,925 3.34 3,586 6 1.85

World 1,34,981 1,78,018 87,505 1,14,353

% Growth% Growth Rank 2018 % share 2023 Rank

GDP RankingCountry GDP (PPP) Ranking(billions of Int. $) GDP (Nominal) Ranking) (billions of $)

Rank 2018 % share 2023 Rank

GDP rankings of top 10 global economies(Source: International Monetary Fund World Economic Outlook , April - 2018)

For the past few quarters now, India has consistently been the fastest-growing major economy globally. The Asian

Development Bank (ADB) has stated that India is the dominant economy in South Asia with its growth gaining momentum at

7.7% in the quarter-ended March of 2017-18, the highest growth since Q1 2016-17.

On India's growth rate projection next fiscal, the ADB said: “Growth in FY 2018-19 is expected to rise to 7.6% as measures to strengthen the banking system bolster private investment and as benefits kick in from GST. Any further increase in oil prices poses a downside risk to growth."

The CII ASCON Q1FY19 survey tracks sectoral growth through responses garnered from sectoral industry associations. On the production front, some sectors shall witnessa steady growth in the foreseeable future. For instance, theautomobile industry has continued to dominate theexport scenario as well.

The services sector is not only the dominant sector, but has also attracted significant foreign investment, and contributed to exports and generated large-scale employment. India’s distinctive competencies and competitive advantages formed by knowledge-based services make it an emerging market. The services sector has the potential to unlock immense opportunities.

The production of food-grains in 2017-18 was 284.83 million tonnes (third advance estimate), compared to 265.04 million tonnes in 2013-14. GDP from Agriculture in India averaged INR 4,057.73 billion from 2011 onwards, reaching an all-time high of INR 5,666.82 billion in the fourth quarter of FY 2016-17, and a record low of INR 2690.74 billion in Q3 of 2011.

The value of merchandise exports and imports increased 17.6% and 21.3% respectively in USD terms in June 2018 over June 2017. Forex reserves stood at USD 400.10 billion as in August 2018.

Going forward, merchandise exports rose 19.2% year-on-year in August 2018, though India's trade deficit widened to USD 17.39 billion from USD 12.72 billion in the same month a year earlier, it compared with the market expectations of a USD 17.25 billion gap.

1.75 % (2005)

2.43 % (2013)

3.25 % (2018)

Growth in India’ share of World GDP

6.74% (2023P)


ifimbschool.com

22

Government of India has taken initiatives for an all-round

development. India launched the Make in India program to

place India on the world map as a manufacturing hub and

give global recognition to Indian economy. India is expected

to become the fifth-largest manufacturer by the end of 2020.

Under Make in India, the Government aims to increase the

share of the manufacturing sector in the GDP to 25 per cent

by 2022, from 16 per cent, and to create 100 million new

jobs by 2022.

Hardly a surprise then, that India today has become one

of the most attractive destinations for investments in the

manufacturing sector. The country has become a leading

mobile manufacturing hub. The Government has taken

initiatives to promote a healthy environment for the growth

of manufacturing. Some of the notable initiatives and

developments are:

●● New industrial policy

●● In Budget 2018-19, the government reduced the I-T

rate to 25% for companies with turnover up to INR

250 crore (USD 38.75 million).

●● The phased manufacturing program (PMP)

has been launched.

●● Ease of FDI in defense under the automatic route

to 51%

●● The government approved the ‘Strategic Partnership’

model to enable private firms to tie up for

manufacturing defence products.

●● Modified Special Incentive Package Scheme (M-SIPS)

has been accepted

India’s ranking in ease of doing business has taken a

quantum leap in a short phase of just two years. The

country’s rank in the World Bank’s Ease of Doing Business

2019 survey climbed 23 places to 77 among 190 countries

surveyed, making it the only country to rank among the top

10 improvers for the second consecutive year.

A number of programs being implemented by the

government aims to increase farmers’ income. The necessity

is to foster synergy in these programmes for success

of various policy initiatives of the central government for

creating an enabling environment for enhancement of

farmers’ income.

The Government has recognizing the importance of growing

services sectors, has extended several incentives for

sectors like healthcare, tourism, education, engineering,

communications, transportation, information technology,

banking, finance, management, etc.

Goods and Services Tax (GST) is going to help the

economic growth of the country by efficient tax collection

India becoming a leading Mobile Manufacturing

Hub (during 2014-18)

Mobile Manufacturing

Units 120 ( up from 2)

Worth of Mobile Handsets produced:

Rs 1.32 lakh cr (up from 18,992 cr)

Mobile Handsets produced 22.5 cr

(up from 6 cr)

Rank 142

(2014)

Rank 130

(2016)

Rank 100

(2017)

India’ world ranking in ease of doing business

Rank 77

(2018)


ifimbschool.com

23

with the motto of ‘one country, one tax, one market’, on its

implementation from 1st July 2017.

Opening of commercial coal mining sector to private players;

transparency in resource allocation with 89 mines allocated;

promulgation of Real Estate Regulation Act for protecting

the buyers rights; and moving forward the disinvestment

processes by crossing the target of Rs 72500 crore are

viewed as some of the bold reforms by the government.

The promulgation of the Insolvency and Bankruptcy Code

has been a historic initiative. The focus of this legislation is at

providing resurrection and resolution.

Following the government bringing the Payment Wages

(Amendment) Act 2017, the applicability of the Act will cover

the enhanced wages ceiling from INR 18,000 per month to

INR 24,000 per month, and thereby benefit a larger number

of employees.

The “Unified Shram Suvidha” Portal of the Ministry of

Labour and Employment brought in October 2014, has

been envisaged as a single point of contact between

employer, employee and enforcement agencies, bringing in

transparency in their day-to-day interactions.

The infrastructure sector is another area where the

government has been not just diligent, but innovative. Some

of the steps taken in the recent past are being discussed

hereafter. The announcements in Union Budget 2018-19,

included the massive push to the infrastructure sector by

allocating INR 5.97 lakh crore for the sector.

The noteworthy initiatives of the government are the ones for

infrastructure boosting through the “Bharatmala” project to

develop and expand approximately 40,000 km of roads at an

investment of INR 6.9 lakh crore by 2022.

The deceleration in GDP growth rates below 7% between

Q3 2016-17 and Q2 2017-18 were attributed to temporary

disruptions in economic activity as the economy adjusted

to demonetization and businesses prepared for the GST.

However, against the background of government initiatives,

the growth prospects in the medium and long term appear

stable, diversified and resilient.

Global sentiment from FIIs, sovereign wealth funds, multi-

nationals cueing up to set up base in India, tech leaders

and the international political community, signal rational

exuberance, towards an irreversible growth story. With

the NDA government at helm, this positive sentiment shall

be channelized to forge a stronger path for the nation to

accentuate its inimitable rise.

India's Global Competitive Index ranking : 71 (2014-15)

India's Global Competitive Index ranking : 40 (2017-18)

Ease of doing

Business

Doing away with

Cascading e�ect of

Taxes

Signi�cant decrease in Transport times with

elimination of check-posts

Overall

Reduction in Prices

End of Multiple

Taxes: Relief to Small

Traders &


ifimbschool.com

24

My government is working for the common man.

Our priority is the poor of the country. We want

good governance through a dynamic and

seamless government”, said Prime Minister Modi

during a conversation with India Inc in April, 2015. The NDA

government has taken substantial measures since coming

to power to ensure the levels of development of the country

envisaged by the current NDA government reaches the

grassroots and touches the lives of all.

The Shrameva Jayate Scheme was announced by the Prime

Minister in 2014 to introduce a whole host of reformative

measures for improving the working conditions and minimum

wages of construction workers, daily wage labourers and

those in the unorganized sector.

Some of the major steps implemented as a part of the

Scheme are as follows:

Development Reaching Poorest, Ensuring Better Life For All

“

dr. rajashree Pandiyan

ASSISTANT PROFESSOR, IIFIM COLLEGE

●● While the UPA government enacted the Unorganized

Sector Workers’ Social Security Act 2008, the current

government is ensuring that the daily wage labourers

get their basic rights

●● It is noteworthy the 7th Pay Commission announced

in 2016 has benefited 5 million employees and 3.5

million pensioners

●● The Centre contributes 12% to the Employees’

Provident Fund for new recruits in the public sector

●● Gratuity ceiling has been enhanced from Rs.10 lakhs

to Rs.20 lakhs since 1st January, 2016. This has

been applicable to both the public and private sector,

and ensures higher savings for the employed and

those who have retired since 1st January 2016.

●● The Apprentices Act, 1961 was amended to ensure

all apprentices and interns get at least some money

for their work as stipend.

●● The Payment of Wages (Amendment) Act 2017

brought into force last year provides that employers

need to pay wages either in cash or cheque or

by crediting the wages in the bank accounts of the

employees. This was done to guard against delayed

payment of wages.

●● Under the Shrameva Jayate Scheme, a Unique

Labour Identification Number (UIN) has been allotted


ifimbschool.com

25

to all daily wagers to identify them individually,

recognize their efforts and also to ensure that no

individual labourer misses out on receiving any kind

of social security benefits that the government may

announce for them from time to time.

The Antyodaya Mission announced in the Union Budget

2017-18, has been initiated to make difference in the lives

of 10 million households across 50,000 Gram Panchayats.

A Mission Mode Project envisaged by the Ministry of Rural

Development, the Antyodaya Mission is a comprehensive

and integrated system for enhancing the efficiency and

effectiveness at Gram Panchayat Level. It is a convergence

framework for measurable effective outcomes on parameters

that transform lives and livelihoods.

Official data from the mission website shows within one and

a half years 206,855 gram panchayats have been covered.

Also the Centre is in the process of reaching out to 15,162

more panchayats. This shows the central government has

been successful in delivering benefits going to over four

times of what it had planned and promised.

It is also critical to draw focus on the Deendayal Upadhyaya

Gram Jyoti Yojana (DDUGJY), a marquee initiative designed

to provide continuous power supply to rural India. As of the

date of publishing, over 586,567 villages across the country,

have been electrified across the length and breadth of India.

Statistics show 217 million rural households have been

electrified under the scheme till date. Some of the salient

points of the DDUGJY are as follows:

●● Separation of agriculture and non-agriculture feeders

for better supply to agricultural & non-agricultural

consumers

●● Strengthening and augmenting sub-transmission &

distribution infrastructure in rural areas

●● Rural electrification for completion of targets laid

down under Rajiv Gandhi Grameen Vidyutikaran

Yojana for 12th and 13th Plans by

subsuming the Rajiv Gandhi Grameen

Vidyutikaran Yojana into the

Deen Dayal Upadhyay Gram Jyoti

Yojana.

The Pradhan Mantri Sahaj Bijli Har Ghar Yojana or the

‘Saubhagya’ Scheme was launched on 25th September,

2017. Under the scheme, the government shall provide free

electricity connections to all households (both APL and poor

families) in rural areas and poor families in urban areas. Rural

electrification Corporation (ReC) has been designated as the

nodal agency.

Under the scheme, as of date, over 21 crore (over 99%)

households across rural India have been electrified. The

total households that are yet to be electrified are 19,372. It

is impressive to say the least. Under the scheme, DISCOMs

have organized camps across rural India to facilitate on-

the-spot filling up of application forms including release of

connections to households. DISCOMs/Power Departments

will adopt innovative mechanisms like dedicated web-portal/

Mobile App for collection/consolidation of applications forms

in electronic mode and releasing connections. Providing

last mile connectivity and electricity connections to all un-

electrified households in rural areas.

The Saubhagya Scheme ensures that households have

access to Solar Photovoltaic (SPV)-based standalone system

for un-electrified households in remote and inaccessible

villages / habitations, where grid extension is not feasible or

cost effective. Providing last mile connectivity and electricity

connections to all remaining poor households in urban areas,

is at the heart of the scheme.


ifimbschool.com

26

Pradhan Mantri Jan Dhan Yojana (PMJDY) is the National

Mission for Financial Inclusion to ensure access to financial

services, namely, banking/ savings & deposit accounts,

remittance, credit, insurance, pension in an affordable

manner. A bank account can be opened in any bank

branch or via a Business Correspondent (Bank Mitra) outlet.

Accounts opened under PMJDY are being opened with

Zero balance. However, if the account-holder wishes to get

cheque book, he/she will have to fulfil minimum balance

criteria.

Some of the special benefits under PMJDY Scheme are:

●● Interest on deposit.

●● Accidental insurance cover of Rs. 1.00 lac

●● No minimum balance required.

●● The scheme provide life cover of INR 30,000 payable

on death of the beneficiary, subject to fulfilment of the

eligibility condition.

●● Easy transfer of money across India

●● Beneficiaries of Government Schemes will get Direct

Benefit Transfer in these accounts.

●● After satisfactory operation of the account for 6

months, an overdraft facility will be permitted

The Claim under Personal Accidental Insurance under

PMJDY shall be payable if the RuPay Card holder have

performed minimum one successful financial or non-financial

customer induced transaction at any Bank Branch, Bank

Mitra, ATM, POS, E-COM etc.

Channel both Intra and Inter-bank i.e. ‘on-us’ (Bank

Customer/RuPay card holder transacting at same Bank

channels) and ‘off-us’ (Bank Customer/RuPay card holder

transacting at other Bank Channels) within 90 days prior to

date of accident, including accident date is being included

as eligible transactions under the RuPay Insurance Program

2016-2017. The overdraft facility up to INR 5,000 is available

in only one account per household, preferably the lady of the

household.

Reports demonstrate that till date, 35.04 crore Jan Dhan

accounts have been opened for direct benefit transfer to

the needy and underprivileged sections. The balance in

beneficiary accounts stands north of Rs. 94,617 crore. Over

1.25 bank mitras are committed to delivering branchless

banking services across rural India. Also, the Indian postal

payments bank has taken the banking system to the

doorsteps of the underprivileged and those who do not have

easy access to the banking system in India.

The Indian Postal Payments Bank (IPPB) gives the poorest

the opportunity to enjoy banking at home with doorstep

services. The wide network of post offices and postal

employees will make banking accessible to the remotest

corners. They can open a bank account, transfer funds,

deposit and withdraw cash, recharge or pay bills and

accomplish much more with our Doorstep banking services,

at nominal charges.

The IPPB has leveraged and connected 155,000 post offices

and helped over 3 million postal employees coordinate

with each other to deliver a whole host of services at the

doorsteps of the poor and rural people. This has proven to

be an extremely innovative step so far as now the banking

system has successfully reached out to the needy rather

than them having to run around from pillar to post for

opening of accounts, maintaining deposits with banks etc.

Also the IPPB system has made the post offices across the

country more efficient and progressive and has helped to

remove the earlier impression from the minds of the people

that the Indian postal service is vastly unreliable and does

not provide any special facilities for the underprivileged.

Pradhan Mantri Suraksha Bima Yojana (PMSBY) is one

of three social security schemes that the government

had announced in the 2015 Budget. The other two being

Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY) and the

Atal Pension Yojana (APY). An accident insurance scheme,

PMSBY offers a one-year accidental death and disability

cover, which can be renewed annually.

The cover is for a one-year period. Under PMSBY, the

risk coverage available is Rupees two lakhs for accidental

death and permanent total disability, and Rupees one lakh

for permanent partial disability. Permanent total disability is

defined as total and irrecoverable loss of both eyes or loss of

use of both hands or feet or loss of an eyesight and loss of

use of a hand or a foot.


ifimbschool.com

27

Permanent partial disability is defined as total and

irrecoverable loss of an eyesight or loss of use of a hand

or foot. The cover will be in addition to any other insurance

plan the subscriber has. The scheme is not a Mediclaim,

i.e., there is no provision for reimbursement of hospitalisation

expenses following accident, resulting in death or disability.

Estimates show that a total of 13.25 crore people have been

insured with personal accident cover under this scheme

at Rupees 12 per year. Thus, more than half of the Indian

population has already benefited from this scheme till date,

ever since the date of its implementation.

The Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY)

is a state-funded, one-year life insurance scheme. The

cover under PMJJBY is for death only and hence benefit

will accrue only to the nominee. PMJJBY is a pure term

insurance policy which covers only mortality. Statistical

reports show that till date nearly six crore people have

enrolled under PMJJBY scheme, and the total number of

claims received till date are nearly 1,02,849.

The government announced the introduction of universal

social security schemes for all Indians, especially the poor

and the underprivileged, in the Budget for 2015-16. With that

objective, the government launched the Atal Pension Yojana

(APY), which provides for a defined pension, depending on

the contribution, and its period.

The APY focuses on the unorganised sector who join the

National Pension System (NPS) administered by the Pension

Fund Regulatory and Development Authority (PFRDA).

Under the APY, the subscribers begin to receive a fixed

minimum pension at the age of 60 years depending on their

contributions. Till date, reports have shown this scheme has

more than 10 million subscribers who as promised receive

a fixed pension amount of anything between INR 1000 and

INR 5,000 per month.

Pradhan Mantri Vaya Vandana Yojana (PMVVY) is a Pension

Scheme announced by the Government of India exclusively

for the senior citizens aged 60 years and above which is

available from 4th May, 2017 to 31st March, 2020.

Due to the success of the scheme, its duration has been

extended till March 2020 and the investment limit under the

annual budget of 2018-19 for the scheme has been raised to

INR 15 lakhs from the earlier ceiling of INR 7.5 lakhs. Further,

the Yojana ever since its inception has successfully delivered

returns at 8% and will be doing so for 10 years from the date

of its inception, i.e. in 2017.

It is evident that the efforts of the Modi government to reach

the poor have been largely successful with the success rate

of some of the schemes exceeding expectations and the

expectations of the poor and underprivileged sections. The

government has ensured that the efforts of development go

down to the poorest by putting people

in charge of uniform implementation of

everything envisaged, starting from the top

to the bottom.

The main objective of direct benefit

transfer can be safely said to have been

met. All this augurs well for the nation in

the coming years. The author is glad to

know the current government realizes the

importance of all sections working together

to transform India. Empowerment will lead

to a happy workforce which in turn will

lead to overall development of the nation

which will further lead to a happy and

prosperous India.


ifimbschool.com

28

We are working aggressively towards making

India a Global Manufacturing Hub. We want

the share of manufacturing in our GDP to go

up to 25 per cent in the near future”, said

Prime Minister Narendra Modi, at the opening of the Make in

India Week in 2016. A marquee initiative by the government,

Make in India, was launched in September 2014. Its hardly

much of a surprise, that in a matter of four years, India

is steadily emerging as a global centre for electronics

manufacturing.

Manufacturing has emerged as one of the high growth

sectors in India. India is expected to become the fifth largest

manufacturing country in the world by the end of year 2020.

“

A Holistic Manufacturing Ecosystem For High

Trajectory Growth

Catching the Manufacturing Missed Bus

dr. Chetan Bajaj

PROFESSOR - MARKETING, IFIM BUSINESS SCHOOL

The industrial sector is made up of manufacturing, mining

& quarrying, and electricity, water supply, and gas sectors.

The industrial sector accounts for around 27.6% of the India

GDP and it employs over 17% of the total workforce in the

country.

The Gross Value Added (GVA) at basic current prices from

the manufacturing sector in India grew at a CAGR of 4.34

per cent during FY12 and FY18 as per the estimates of

annual national income published by the Government

of India. During April-September 2018, GVA from

manufacturing at current prices grew 14.8 per cent year-

on-year to Rs 138.99 trillion (US$ 198.05 billion). Under

the Make in India initiative, the Government of India aims to

increase the share of the manufacturing sector to the gross

domestic product (GDP) to 25 per cent by 2022, from 16 per

cent, and to create 100 million new jobs by 2022.

Manufacturing Sector is key driver for the growth of

economy. The benefits from growth of Manufacturing sector

include

●● Utilization of natural resources like mineral, forest

and agro-based resources. Development of Agro

based industry increases the value of farm produce.

●● Growing industrialization in the country can attain

balanced sectoral development and thereby reduce

over dependence of the economy on the agricultural


ifimbschool.com

29

sector. As industries develop People move away from

farming and there-by reduce pressure on land.

●● Increasing volume of investment in industries leads

to enhancement in the rate of capital formation in the

country. This leads to increase in GDP and Per capita

income. The country becomes self-reliant and its

exports grow.

●● Development of industrial sector, particularly the

labor intensive Small and Medium scale enterprises

would create job opportunities for millions of

unemployed persons and thereby lessen the burden

of unemployment.

The NDA Government has taken several initiatives

to promote a healthy environment for the growth of

manufacturing sector in the country. Make in India is a

major initiative of the Modi Government to encourage

companies to manufacture their products in India. It was

launched in September 2014 and covers 25 sectors of the

economy. Make in India seeks to establish best facilities and

Infrastructure to attract foreign companies to invest in India.

Projects under Make in India initiatives are granted speedy

approvals. The vision of ‘Make in India’ is to transform India

into a global design and manufacturing hub and build best

in class manufacturing infrastructure, to facilitate investment,

to foster innovation, enhance skill development and

protect intellectual property. The Idea is to attract Foreign

Investments and Technology by enabling foreign investors

to take advantage of huge domestic market and use India’s

huge resource base to create a Global manufacturing hub.

Make in India concept was extensively marketed, across the

World, with attractive Promotional campaigns. A dynamic

web portal was launched and attractive brochures were

released on the 25 sectors. Foreign equity caps, norms and

procedures in various sectors were relaxed.

Application of manufacturing application was made available

online and the validity of licenses was increased to three

years. As per the current policy, 100% Foreign Direct

Investment (FDI) is permitted in all 25 sectors, except for

Space industry (74%), defense industry (49%) and Media

(26%). Japan and India also announced a US$12 billion

“Japan-India Make-in-India Special Finance Facility” fund

to push investment. In line with the Make in India, individual

states too launched their own local initiatives, such as

“Make in Odisha”, Vibrant Gujarat “Happening Haryana” and

“Magnetic Maharashtra”

Zero Defect Zero Effect” slogan was coined by Narendra

Modi to capture the essence of the Make in India initiative.

This was to bring advanced processes,

materials and technologies to India and

manufacture Quality Products with zero

defects and no adverse effect on the

Environment. “Make in India Week” multi-

sectoral industrial event was organized in

February 2016. It was attended by 2500+

international and 8000+ domestic, foreign

government delegations from 68 countries

and business teams from 72 countries and

17 Indian states.

Start-up India is another key initiative of

the Modi Government to develop a strong

ecosystem to promote start-ups in the

country. This initiative, is based on the

following three pillars:


ifimbschool.com

30

1. Simplification and Handholding.

2. Funding Support and Incentives.

3. Industry-Academia Partnership and Incubation.

Restrictive Government policies, within this domain,

pertaining to Licenses, Land Permissions, Foreign

Investment Proposals, and Environmental Clearances are

liberalized and discarded.

Standup India initiative was launched by Prime Minister

Narendra Modi to support entrepreneurship among women

and SC & ST communities.

Besides, the highly acclaimed initiatives like Make in India,

Start-up India and Stand-up India, some other major

initiatives taken by the Modi Government after 2014, to

boost growth of Manufacturing sector include:

●● Finalization of Draft National Policy on Electronics

(NPE), released in October 2018, which envisages

creation of a US$ 400 billion electronics

manufacturing industry in the country by 2025.

●● Exemption of 35 parts from basic custom duty, in

September 2018, to boost mobile handset

production in the country. The Government of India

also has launched a phased manufacturing

program (PMP) aimed at adding more smartphone

components under the Make in India initiative

thereby giving a push to the domestic

manufacturing of mobile handsets.

●● Income tax rate for all companies having a turnover of

up to Rs 250 crore (US$ 38.75 million), was

reduced to 25 per cent.

●● Export incentives available to labor intensive MSME

sectors by increased by 2 per cent under the

Mid-Term Review of Foreign Trade Policy (2015-20).

●● The Government of India is in talks with stakeholders

to further ease foreign direct investment (FDI) in

defense under the automatic route to 51 per cent

from the current 49 per cent, to give a boost to the

Make in India initiative and to generate employment.

●● The Ministry of Defense, Government of India,

approved the “Strategic Partnership” model which

will enable private companies to tie up with foreign

players for manufacturing submarines, fighter jets,

helicopters and armored vehicles.


ifimbschool.com

31

●● The Union Cabinet has approved the Modified Special

Incentive Package Scheme (M-SIPS) in which,

proposals will be accepted till December 2018 or

up to an incentive commitment limit of Rs 10,000

crore (US$ 1.5 billion).

The dynamic policies of the Modi Government have

changed the scenario of manufacturing in the Country. Huge

investments have poured in and massive projects have been

launched. The big policy changes in India have also been

highly appreciated in Global forums

The World Bank latest ‘Doing Business Report’(DBR, 2019)

shows that India has jumped to 77th Position out of 190

countries in Ease of Doing Business Index, a jump of 23

positions against its rank of 100 in 2017, and 130 in 2016.

By the end of 2017, India had also risen 32 places in World

Economic Forum’s Global Competitiveness Index and 19

notches in the Logistics Performance index.

After the launch of make in India initiative, India received

investment commitments worth `16.40 lakh crore (US$230

billion) and investment inquiries worth `1.5 lakh crore (US$21

billion), between September 2014 to February 2016. India

emerged as the top destination globally in 2015 for Foreign

Direct Investment (FDI), surpassing USA and China with

US$60.1 billion FDI.

Several large Manufacturing Projects have been announced

following the policy Initiatives of the Modi Government, after

it came to power in 2014. The massive scale and scope of

these Projects can be gauged from following commitments:

●● General Motors announced investment of US$1

billion to manufacture automobiles in Maharashtra.

SAIC Motors announce an investment of Rs. 2,000

crore in a car manufacturing plant in Gujarat.

●● In April 2017, Kia, announced that the company

would invest over $1.1 billion to build a car

manufacturing plant in Anantapur, Andhra Pradesh.

This will create Employment for 10,000 people

●● European automobile major PSA announced that in a

partnership with CK Birla Group, it is going to build

a car manufacturing plant in Tamil Nadu at the cost of

`7,000 crore ($1.03 billion).

●● Boeing announced setting up of a factory to

assemble fighter planes, either the Apache or

Chinook, defense helicopter in India, as well as the

manufacture of F/A-18 Super Hornet.

●● In May 2018, the Indian Army announced a `50,000

crore (US$7.0 billion) ammunition production project

to be implemented in phases over a 10-year period.

Under the project, 11 private firms will manufacture

and supply ammunition for the Army’s tanks, rockets,

air defense system, artillery guns, infantry combat

vehicles, grenade launchers and other field weapons

●● Foxconn committed US$5 billion investment over

5 years in research and development and hi-tech

semiconductor manufacturing facility.

●● In April 2018, Saudi Arabian Oil giant Aramco signed

an initial deal with a consortium of Indian refiners to

build a $44 billion refinery and petrochemical project

on India’s west coast.

●● Huawei announced new research and development

(R&D) campus in Bangalore with an investment of

US $ 170 million and telecom hardware

manufacturing plant in Chennai.

Modi Government seeks to make Manufacturing sector

the major engine for Economic growth over next 10 years.

As contribution of Agriculture to total GDP declines, the

share of Industry in GDP will increase. The vision for the

Manufacturing sector stated in the National Manufacturing

Policy (NMP) anticipates that manufacturing sector will have

a growth rate of 12-14% in the medium term. Accordingly,

the share of Manufacturing sector in GDP will increase to

25% by 2022. Several incentives are given to small and

medium enterprises, which are labour intensive and generate

maximum employment under Start-up India and Stand-

up India schemes. Manufacturing sector will generate 100

million new jobs by 2022


ifimbschool.com

32

When 1.25 billion dreams go towards a goal,

there’s nothing that cannot happen. In 2014,

the people of the country did not just stop at

forming a government. They got together for

nation-building and they will keep at it”, said Prime Minister

Narendra Modi during his speech from the Red Fort on the

country’s 72nd Independence Day.

While, the issue of reservation and quota for the certain

sections of the society (based on the age-old caste system

as well as religious and ethnic minorities) has been a

defining feature of the Indian democratic system, no other

government in the history of post-Independent India has ever

tread on the path to focus on the economically backward

or weaker sections of the General Category, through

reservations.

On January 7, 2019, the Government approved a 10 per

cent reservation for economically backward upper castes

in government jobs and education. An individual shall be

“

Ensuring 'Sabka Saath, Sabka Vikas'

Pritam ghosh

ASSISTANT PROFESSOR OF LAW, IFIM LAW SCHOOL

qualified as economically weaker if his/her annual income is

below Rupees eight lakhs, the agricultural land ownership is

less than five hectares and home ownership is below 1,000

square feet.

The year 2014 was a landmark year in the political history

of India. After three decades, India voted a government into

power through an overwhelming majority. The former Chief

Minister of Gujarat Narendra Modi took over the reins, with

the resolve of ‘Sabka Saath Sabka Vikas’, and ‘Maximum

Governance, Minimum Government’.

While the ‘Suit boot ki sarkar’ jibe has been a constant by

those opposing the government’s development model, the

government has silently but in a typically unflinching resolve,

worked towards the upliftment of the common man and

towards the betterment of all-round development of all classes

of the society ever since being voted to power in 2014.

The Scheme of Grant in Aid to Voluntary Organisations

working for Scheduled Castes, for instance, is a timely

initiative to involve the voluntary sector and training

institutions of repute to improve educational and

socioeconomic conditions of Scheduled Castes. Through the

programme, the members of these communities would be

engaged with to upgrade their skills to enable them to take

up jobs or to encourage self-employment.

The government has been early to recognize that children

and youth are the future of the country. An inclusive

approach towards educating and skilling them is at the heart

of a sustainable long term socio-economic development.

Reports by the Ministry of Social Justice indicate that till

date more than 200 NGOs across the country have received


ifimbschool.com

33

grants to setup residential primary schools, nursing homes

and dispensaries, vocational training centres etc.

The pre-matric Scholarship to the students from the

Scheduled Caste (SC) students studying in classes IX & X is

a Centrally Sponsored Scheme and implemented through

State Government and Union Territories (UT) administration.

The key objectives of the scheme are:

(1) To support parents of SC children for education of

their wards studying in classes IX and X so that the

incidence of drop-out, especially in the transition

from the elementary to the secondary stage is

minimized

(2) To improve participation of SC children in classes IX

and X of the pre-matric stage, so that they perform

better and have a better chance of progressing to

the post-matric stage of education.

(3) The Scheme will be available for studies in India only

and will be awarded by the Government of the State/

Union Territory to which the applicant belongs i.e.

where he is domiciled.

It is noteworthy that the annual report of implementation of

schemes published by the Ministry of Social Justice indicates

that for the 2017-18 plan year, Rs 3,347.99 crore of funds

have been released by the Central Government for the grant

of post matric scholarships to students of the Scheduled

Caste Category.

Another scheme, the Free Coaching for SC and Other

Backward Classes (OBC) students provides coaching of

good quality for economically disadvantaged candidates

to enable them to appear in competitive examinations and

succeed in obtaining an appropriate job in Public/Private

Sector. The scheme is being implemented through reputed

coaching institutions/centres run by the:

(1) Central Government/State Governments/

UTAdministrations/PSUs/Autonomous Bodies under

Central/State Governments;

(2) Universities (both Central and State) including the

Deemed Universities and Private Universities

recognized by concerned authority; and

(3) Registered private institutions/NGOs.

Reports suggest that for the 2017-18, Rs. 25 crore has

been released to provide free coaching so that the students

of the SC/ST/OBC categories could appear for competitive

examinations.

Ever since 2014, the Modi government has been able to

allocate and spend a total of Rs. 95000 crores for the overall

welfare of the Scheduled Caste (SC), Scheduled Tribe (ST)


ifimbschool.com

34

and Other Backward Classes (OBC). This includes an

unprecedented rise of 41% in the budget allocation for OBC

welfare in 2018-19 as compared to the financial year 2017-18.

It is noteworthy that over 3.3 crore students benefited from

the same during the two financial years of 2014-15 and

2015-16, with scholarships worth Rs 7,565 crore. One of the

major changes brought about in the Pre-Matric Scholarship

scheme for OBCs in the current financial year is the raising of

the income eligibility limit to avail the scholarship scheme.

Till the previous financial year, the eligibility limit was set

at Rs 44,500 per annum. which allowed only a miniscule

section of the population to be covered by the scheme.

However, the limit has been raised to Rs 2.5 lakhs per

annum. in the current financial year which has meant that

a larger percentage of the OBC population in India can

now be covered for the distribution and allocation of the

scholarships.

It is anticipated that this move shall create a bigger umbrella

under which a substantial portion of the OBC student

population in the country shall be reaping the benefits. The

income eligibility limit has also been raised in the current

financial year from Rupees two lakhs per annum to Rupees

2.5 lakhs per annum for the Pre-Matric Scholarship scheme

for the SCs.

In terms of increasing accessibility to public places for all

sections of the society, the government has converted at

least 50% of all government buildings in the national capitals

and in all the capital cities of states into fully accessible

places for the public, especially for the differently abled.

Special camps have been organized frequently since the

year 2014 for the distributions of Aids and Assistive devices

to eight lakh individuals with disabilities.

The Department of Empowerment of Persons with

Disabilities (DEPwD) has launched Accessible India

Campaign (Sugamya Bharat Abhiyan) as a nation-wide

initiative to achieve universal accessibility for Persons with

Disabilities (PwDs).

An accessible physical environment that benefits everyone,

not just persons with disabilities, is the focus. The

government has stated that measures should be undertaken

to eliminate obstacles and barriers to indoor and outdoor

facilities including schools, medical facilities, and workplaces.

These would include not only buildings, but also footpaths,

curb cuts, and obstacles that block the flow of pedestrian

traffic.

Objective 1: Enhancing the proportion of accessible government buildings


ifimbschool.com

35

An accessible government building is one, where persons

with disabilities have no barrier in entering it and using all

the facilities therein. This covers the built environment

– services, steps and ramps, corridors, entry gates,

emergency exits, parking – as well as indoor and outdoor

facilities including lighting, signages, alarm systems and

toilets.

Identifying accessible buildings requires annual accessibility

audits that determine if a building meets agreed upon

standards. Once a building is deemed fully accessible, an

annual audit is not necessary, but should be required for any

proposed changes to the structure or systems contained

therein. A full audit can then be done on a less frequent

basis.

Standards of accessibility should be as consistent as

possible with international standards, such as those of

the ISO, considering the local context. About the built

environment, ISO 21542:2011, Building Construction

– Accessibility and Usability of the Built Environment,

delineates a set of requirements and recommendations

concerning construction, assembly, components and fittings.

Speedy and effective implementation of the campaign

It is worthwhile to mention that audit for accessibility of

government buildings and public places for the differently

abled has been conducted for a total of 1,662 buildings in 50

cities and the process is ongoing in another 25 new cities at

the moment. In addition, all 34 international and 48 domestic

airports in the country have been provided with ramps,

accessible toilets, lifts with Braille symbols and auditory

signals.

The Rights of Persons with Disabilities Act, 2016 is a legal

milestone in the history of India. Under the RPWD Act,

2016, the list has been expanded from 7 to 21 conditions

and it now also includes cerebral palsy, dwarfism, muscular

dystrophy, acid attack victims, hard of hearing, speech

and language disability, specific learning disabilities, autism

spectrum disorders, chronic neurological disorders such as

multiple sclerosis and Parkinson’s disease, blood disorders

such as haemophilia, thalassemia, and sickle cell anaemia,

and multiple disabilities.

These disabilities have now been included in the 2016

legislation for the first time and were not there in the Disability

Act, 1995, enacted during the reign of the then government.

The nomenclature mental retardation is replaced by

intellectual disability which is defined as “a condition

characterized by significant limitation both in intellectual

functioning (reasoning, learning, problem-solving) and in

adaptive behaviour which covers a range of every day social

and practical skills including specific learning disabilities and

autism spectrum disorders.”

The RPWD Act, 2016 provides that “the appropriate

Government shall ensure that the PWD enjoy the right to

equality, life with dignity, and respect for his or her own

integrity equally with others.”

The Government has taken steps to utilize the capacity

of the PWD by providing appropriate environment. It is

also stipulated in the section 3 that no PWD shall be

discriminated on the ground of disability, unless it is shown

that the impugned act or omission is a proportionate means

of achieving a legitimate aim and no person shall be deprived

of his personal liberty only on the ground of disability.


ifimbschool.com

36

Living in the community for PWD is to be ensured and steps

are to be taken by the Government to ensure reasonable

accommodation for them. Special measures are to be taken

to ensure women and children with disabilities enjoy rights

equally with others. Measures are to be taken to protect

the PWD from being subjected to cruelty, inhuman, and

degrading treatments and from all forms of abuse, violence,

and exploitation.

Police officers, who receive a complaint or otherwise

come to know of violence, abuse, or exploitation, shall

inform the aggrieved PWD of his right to approach the

executive Magistrate. The police officer shall also inform

about particulars of nearest organization working for the

rehabilitation of the PWD, right to free legal aid, and right to

file complaint under the provisions of this Act or any other

law dealing with such offence.

Equal protection and safety in situations of risk, armed

conflict, humanitarian emergencies, and natural disasters are

to be provided to PWD. Children with disability are not to be

separated from parents except on the order of a competent

court and information about reproductive rights and family

planning to the PWD is to be ensured. Accessibility in voting

and access to justice without discrimination to the PWD are

to be ensured. Public documents are to be made available in

accessible formats.

It is to be ensured that all PWD enjoy legal capacity on an

equal basis with others in all aspects of life and has the right

to equal recognition everywhere as any other person before

the law and have the right, equally with others, to own and

inherit movable and immovable property as well as control

their financial affairs (Sec 13).

However, the PWD would have the right to alter, modify,

or dismantle the support system and in case of conflict

of interest, the supporting person would withdraw from

providing the support [sec 13(4&5)]. It has been provided

in the section 14 of the Act that a District Court or any

designated authority, as notified by the State Government,

finds that a person with disability, who had been provided

adequate and appropriate support but is unable to take

legally binding decisions, may be provided further support

of a limited guardian to take legally binding decisions on his

behalf in consultation with such person, in such manner, as

may be prescribed by the State Government.

It is also provided that the District Court or the designated

authority, as the case may be, may grant total support to

the person with disability requiring such support or where

the limited guardianship is to be granted repeatedly. In these

cases, the decision regarding the support to be provided

shall be reviewed by the Court or the designated authority,

as the case may be, to determine the nature and manner of

support to be provided.

Limited guardianship has been explained to mean a system

of joint decision which operates on mutual understanding

and trust between the guardian and the person with

disability, which shall be limited to a specific period and

for specific decision and situation and shall operate in

accordance to the will of the person with disability. It is also

provided that on and from commencement of the Act, every

guardian appointed under any other law for time being in

force shall be deemed to function as a limited guardian.

The Act provides for the access to inclusive education,

vocational training, and self-employment of disabled persons

without discrimination and buildings, campuses, and various

The Act provides for the access to inclusive education, vocational

training, and self-employment of disabled persons without

discrimination and buildings, campuses, and various facilities are to be made accessible to the

PWD and their special needs are to be addressed


ifimbschool.com

37

facilities are to be made accessible to the PWD and their

special needs are to be addressed.

Necessary schemes and programs to safeguard and

promote the PWD for living in the community are to be

launched by the Government. Appropriate healthcare

measures, insurance schemes, and rehabilitation programs

for the PWD are also to be undertaken by the Government.

All Government institutions of higher education and those

getting aid from the Government are required to reserve

at least five per cent of seats for persons with benchmark

disabilities. Also, four per cent reservation for persons

with benchmark disabilities is to be provided in posts of

all Government establishments with differential quotas for

different forms of disabilities. Incentives to employer in private

sector are to be given who provide five per cent reservation

for persons with benchmark disability.

Special employment exchanges for the PWD are to be

set up. Standards of accessibility in physical environment,

different modes of transports, public building and areas are

to be laid down which are to be observed mandatorily and a

5-year time limit is provided to make existing public building

accessible.

Access to information and communication technology is

to be ensured. The Central and State Advisory Boards on

disability are to be constituted to perform various functions

assigned under the Act. District level Committees are

also to be constituted by the State Government. Chief

Commissioner and two Commissioners for PWD are to be

appointed by the Central Government at the central level for

the purposes of the Act.

Similarly, State Commissioners for PWD are to be appointed

by the State Governments. National Funds for PWD and

State Funds for PWD are to be constituted at the central and

state levels respectively by the appropriate Governments.

Contraventions of the provisions of the Act have been made

punishable by a fine of an amount up to ten thousand for first

contravention and fifty thousand extendable up to five lakhs

for subsequent contraventions. Atrocities on PWD have been

made punishable with imprisonment of 6 months extendable

to five years and with a monetary penalty.

Statistical records show that ever since the enactment of the

Disability Act 2016, reservations for the “Divyang” population

of the country in government jobs has been raised from

three per cent to four per cent. Further, it is noteworthy that

more than 6 lakh people have benefited from 5,790 camps

organized across the country since May 2014.

On 1st November, 2014 a scholarship scheme was

introduced by the Modi government to provide financial

assistance to Divyang students to pursue technical

education. As a part of this scheme, every year there are

1,000 scholarships available to such students within which

Rs. 30,000 is provided towards tuition fee reimbursement

and Rs. 20,000 as contingency allowance.

Also, the Indian Sign Language Research and Training

Centre (ISLTRC) was established on 28th September, 2015,

with the objective of providing Sign Language Training

services to the section of the Indian population that is visually

and auditorily impaired.

Major amendments were approved on 1st August, 2018, by

the Modi government to the original SC/ST Atrocities Act

of 1989 in order to eradicate the victimization of the SC/

ST/OBC communities and being subjected to physical and

verbal atrocities by the forward classes.

The amendment bill of 2018 proposes the establishment of

special fast track courts for the speedy disposal of offences

committed against the backward classes by targeting

them in public or private. Special rights for protection to

victims and witnesses has also been proposed and the

corresponding duty has been imposed upon states and

union territories to adopt effective measures for victim and

witness protection.

These amendments will ensure that the backward classes

are no longer victimized and receive speedy justice in case of

being targeted by the forward classes and being deprived of

their basic human rights.

Prime Minister Narendra Modi, inaugurated the BR

Ambedkar International Centre in New Delhi on 7th

December, 2017, and said it would be an important place for


ifimbschool.com

38

research on social and economic issues. The Dr. Ambedkar

International Centre for Socio Economic Transformation is

also part of this project for which our Hon’ble Prime Minister

had said on the occasion of its inauguration that this will be

an important centre for research on social and economic

issues. He said the centre would function as a think-tank for

inclusive growth, and related socio-economic matters.

The Prime Minister and his government aim to create

awareness about the life and achievements of Dr. Ambedkar

and his great service to the nation by developing the

“Panchteerth” which are the places associated with his life

and include his birthplace in Mhow, Madhya Pradesh, his

residence during studies in London, Deeksha Bhoomi in

Nagpur where he embraced Buddhism, Mahaparinirvan

Sthal at Alipur in Delhi where he attained Parinirvan and his

memorial at Chaitya Bhoomi in Mumbai.

If one examines the overall performance of the Modi

government till date, the constant effort to keep striving for

a better and shining India becomes evident through the

adoption of innovative means to seek the end.

One hopes that the people of this country shall do a great

service to themselves by voting the Modi government into

power in the next elections so that the Prime Minister and his

team get five more years to bring about radical changes to

all systems prevalent in the country thereby making India a

superpower at par with the western world.

Transparency, accountability, initiating hassle-free legal

processes with the least amount of bureaucratic procedures

has been the focus from day one for the current NDA

government. Facilities that had been denied to the people of

this country for decades together have now reached them.

For instance, till 2014 the process of attestation on

documents used be an extremely tedious process with one

having to run around from pillar to post to look for a class

I gazetted officer to attest documents. However, all that

has now changed since the current NDA government has

brought in the concept of self-attestation of documents

wherein one can put his own signature on a photocopy of an

original document.

This is saving a lot of time, money and resources for the

common man and is allowing him to concentrate on other

important steps within an approval or submission process.

Also, this move has sent out an extremely positive message

to the Indians as the government wants to indirectly convey

that an individual’s own signature is sufficient proof of the

authenticity of the documents in his possession and do not

need to be verified by a third person for their genuinity.

Another commendable move made by the current

government is the swoop down on the creation of black

money and possession of undisclosed assets and income

within the economic system which had almost led to the

creation of a parallel economy within the main economy

consisting of the financial and capital markets.

To this effect the enactment of the Black Money Act 2015,

the Voluntary Disclosure of Income Scheme, 2015, and

major amendments to the Benami Transactions Act, are

major steps towards flushing out illegal wealth and bringing

in transparency, economic growth and revenue generation

into the Indian monetary system.

Recommendations to bring about such changes had been

made in the last four decades by economists such as Prof.

Sukhomoy Chakraborty but have been finally implemented

by the NDA government 2015 onwards. As a result, the

latest data on tax filing released by the Finance Ministry of

the Government of India shows that the number of new ITR

(Income Tax Return) filers grew by over 16 per cent from

85.51 lakh new filers for 2016-17 to 99.49 lakh in 2017-18.

All this can only mean “Achhe Din” has already arrived and

India is being led towards a new dawn of globalization,

industrialization, transparent and good governance and

efficient law enforcement and administration with a mixture

of speedy achievement of the greatest good of the greatest

number through social welfare legislations, social justice

and high levels of commitment to the people of this nation

all of which is coming from our dynamic Prime Minister Mr.

Narendra Modi and his cabinet.


ifimbschool.com

39

Yoga is India’s gift to the world for health, wellness

and peace. It connects us with wellness and

happiness”, said a jubilant Modi, on the sidelines

of the G20 Summit, at Buenos Aires, Argentina.

The United Nations General Assembly (UN GA) in December

2014, adopted a draft resolution declaring June 21 as

International Yoga Day. A record 177 countries co-sponsored

the resolution. As India is set firmly on a path to being a

superpower, it’s not flexing its muscles. It’s is using its soft

power to achieve its aim. Sports and Yoga are two ways it

believes it can get its rightful place.

The importance of sports and fitness in one’s life is

invaluable. Playing sports inculcates team spirit, develops

strategic & analytical thinking, leadership skills, goal setting

and risk taking.

Sports are an extremely important component for the

overall development of our nation. The potential needs to be

showcased on a global platform. It’s time we inspired young

talent, gave them top-notch infrastructure and training.

Projecting India's Soft Power Through AYUSH

“

rajarshi-ChakraBorty

ASSISTANT PROFESSOR, IFIM BUSINESS SCHOOL

The Khelo India programme has been introduced to kindle a

sports culture at the grassroots through a strong framework

for all sports.

To accomplish this, Khelo India programme has been divided

into 12 verticals to promote and generate interest in sports.


ifimbschool.com

40

Talented players identified in priority sports will be provided

annual financial assistance of INR 5 lakh per annum for 8

years. (Khelo India)

Many schemes and policies have been introduced. One such

is TOPS. The Target Olympic Podium Scheme is a flagship

program of the Government with the aim to produce Olympic

champions in 2020 and 2024 by identifying athletes and fund

the medal prospects for the Olympics in Paris in 2024 and

Los Angeles in 2028.

The TOPS-sponsored athletes saw relative success at the

2016 Rio Olympics and the 2018 Commonwealth Games.

In the 2016 Paralympics Games, the TOPS Athletes won 2

Gold, 1 Silver and 1 Bronze, demonstrating the effectiveness

of the Scheme. The recent success of the Commonwealth

Games emphasized the efficacy of the Scheme. Out of the

70 athletes who won medals at the CWG, 47 of them were

supported under the TOP Scheme. (India, Sports Authority

of india, 2018).

While addressing the 69th session of the UN on September

27, 2014, Prime Minister Narendra Modi urged for the

adoption of an International Day of Yoga.

On December 11, 2014, the General

Assembly approved the proposal to

establish 21 June as “International Day

of Yoga”. In its resolution, the UNGA

recognised that Yoga provides a holistic

approach to health and well-being.

The Ministry of AYUSH organised 1st

International Day of Yoga (IDY) on 21

June, 2015 in New Delhi. A 2-day

international conference on “Yoga for

Holistic Health” was organised on 21st

and 22nd June, 2015 in New Delhi and

millions across the world participated.

Outside India, IDY was celebrated in all

the UN members.

The present NDA government is

the first to truly leverage India’s soft

power. Narendra Modi’s government

has emphasised India’s cultural gifts

to the world, and aimed to strengthen their connections,

particularly, with the countries of Asia most influenced

by India in the past. Cultural power is perhaps the most

influential in this globalised economy. and It must form an

integral part of a realistic foreign policy.

Narendra Modi’s Yoga initiative, marks a new era, a new

India. His government is introducing Yoga training in schools

at all levels, not limiting Yoga to exercise, but including

pranayama and meditation.

Soft power is one of the key components of foreign policy in

this age of mass communication, global trade and tourism.

This soft power includes culture, sharing the intellectual,

artistic and spiritual culture with other nations.

Soft power is part of “cultural diplomacy”, using culture to

create a favourable foreign policy image for a country to

expand its associations and its interests.

When a country loses its cultural identity, other national

interests may come under threat. Cultural diplomacy has


ifimbschool.com

41

economic, political and social benefits, and aids in the

defence and security of a nation.

The Prime Minister’s clarion call for a ‘Fit India’, a mass

movement to take the nation forward on the path of fitness

and wellness. Personalities from different walks of life

including those from the media, films, sports, as well as

individuals from the armed forces, academia, corporate etc.

widely participated in the campaign through social media-

powered fitness challenge.

Invoking India’s ancient esoteric practice of Yoga along with

an equally revered, but hardly understood medicinal system,

Ayurveda, is creating a wider platform to showcase the sub-

continent’s indigenous wellness practices. The Ministry of

AYUSH (Ayurveda, Yoga, Unani, Siddha and Homeopathy),

the nodal ministry to promote research, awareness and the

practice of these forms, has led to the larger awareness

globally and at home, about the multiple benefits of these

practices.

In 2017, the government inaugurated the All India Institute

for Ayurveda, an apex institute that propagates, practices

and spearheads the medicinal practice across the country. A

host of ministries including railways, defence and labour have

agreed to collaborate with the Ministry of AYUSH to set-up

special wings within the allopathic hospitals operated by

these nodal ministries.

While the government has allocated Rs. 5,000 crore to

promote Ayurveda and Yoga, it has also stated that an

expansion of the sector shall lead to creation of jobs and

a better lifestyle among the citizenry. The Secretary for the

Ministry of AYUSH, Rajesh Kotecha, as a matter of fact,

stated that the creation of AYUSH has led to a 15-20%

growth in patient inflow to the sectors.

The present government harnessed India’s soft power. The

government has emphasised India’s cultural gifts to the

world, and aimed to strengthen diplomatic connections.

Cultural power must form an integral part of a realistic foreign

policy.

The Indian Council of Cultural Relations (ICCR) can play

an important role in this new expression of soft power and

cultural diplomacy. ICCR has the facilities and associations in

the many countries.

It is imperative that India expands its soft power and

civilisational strength, both for national unity and to gain

its rightful place in the world. It requires a new generation

of diplomats with a worldview in harmony with India’s

civilizational values. (Frawley, India’s soft power and

diplomacy: Role of Yoga and Dharmic traditions, 2018)


ifimbschool.com

42

The Union Government has accorded high priority

to the MSME sector in recent years. This outreach

and support programme, which will run for the

next 100 days, covering the entire country, is

expected to provide even greater synergy to the efforts being

made for this sector”, tweeted Prime Minister Narendra Modi

on November 2, 2018, post the launch of a mega initiative

for the Micro, Small and Medium Scale Industries (MSMEs).

The MSME Support and Outreach Programme, launched

by the government to boost the sector and improve credit

facilities for the entrepreneurs. The 100-day 100-district plan

was the perfect platform to launch the initiative for a sector

that employs the most number of people after agriculture.

Boosting MSMEs Sector Through High

Powered ReformsEnsuring Sustenance of Growth Drivers

dr. sangita dutta guPta

ASSOCIATE PROFESSOR, ECONOMICS & ENTREPRENEURSHIP, IFIM BUSINESS SCHOOL

“

While demonetization was a masterstroke in flushing out

black money in the system, the MSME and the unorganized

sectors of the economy, owing to the bottleneck to access

financial infrastructure facilities, faced a minor hiccup

(although the long-term prospects remained bright). The

GST, again a big-bang structural reform by the government,

created short-term blip for the MSME sector.

The market dynamics weren’t too much in favour either, as

the IL&FS fiasco, unfolded a shroud of fear among NBFCs

who were unwilling to lend to any institution, more so to the

MSMEs. A loan sanction of up to Rupees one crore in just 59

minutes, de-bottlenecking heavy-handed regulation through

transparent inspection, single window quick clearance and

formation of clusters are among the salient points of the

12-point action plan to rejuvenate the MSME sector.

There is no doubt that MSMEs contribute in a big way to

the economy. Today, India is one of the fastest growing

major economies in the world, that has the potential to be

a defining superpower in the decades to come. However,

the country’s industrial development is quite akin to the kind

of roadmap that most colonized nations had followed post

political sovereignty. The genesis of the country’s modern

industrial history suggests that the charkha, the cottage

industry and the small scale trader have been the backbone

of the economy.

Post the advent of liberalization policies in 1990, India


ifimbschool.com

43

witnessed a surge in economic activity, that transformed

trade, commerce and industry structurally, forever. The role

of the mega-PSUs diminished slowly, although not marginal,

by any extent. The rise of a new breed of entrepreneurs and

foray by foreign multi-national companies changed the face

of the Indian industry forever.

India stands in the third position in the world when compared

on the basis of “Purchasing Power Parity” (PPP), second only

to the United States and China. There has been significant

growth in per capita gross domestic product (GDP) of India.

This increase in the GDP per capita in PPP can be attributed

towards the strengthening of Indian economy. The GDP of

India has seen significant growth in the recent years and it no

longer represents an under-developing country. The GDP of

India is depicted in Figure 1 below.

Figure 1: GDP of India

MSMEs are the engine of the Indian economy. The service

sector MSME contributes more than manufacturing sector

MSME in India. Owing to the legacy of India’s industrial

evolution as well as the manner in which the manufacturing

and services sectors of the economy have panned out in

India, MSMEs are also a major contributor to employment

generation. The development of clusters around large

corporations and manufacturing facilities has led to the

development of a hub-&-spoke model. Although agility and

entrepreneurship are a defining trait of the MSMe segment,

the Indian MSME sector is not as evolved in terms of its

innovation quotient. However, capital intensive innovation is

replaced by frugal ‘jugaad’.

Being one of the youngest nations in the world provides

India a tremendous edge in terms availability of labour. This

demographic dividend to play out, however, needs a host of

factors The percentage of working population (between 15%

and 64%) is expected to be two-third of the total population

by 2025. By 2030, India will be the youngest nation. So the

sector which generates employment becomes extremely

important for the growth of the economy.

MSMEs complement large industries by acting as ancillary

units. They play an important role in the development of the

industrial sector. As it can be seen from the table below that

share of MSME in GDP is close to 30%.

0

500000

1000000

1500000

2000000

2500000

3000000

3500000

Q2

2011

Q3

2011

Q4

2011

Q1

2012

Q2

2012

Q3

2012

Q2

2012

Q1

2013

Q2

2013

Q2

2013

Q3

2013

Q4

2013

Q1

2014

Q2

2014

Q3

2014

Q4

2014

Q1

2015

Q2

2015

Q3

2015

Q4

2015

Q1

2016

Q2

2016

Q3

2016

Q4

2016

Q1

2017

GDP OF INDIA (In Crores)

Sou

rce:

Blo

ombe

rg


ifimbschool.com

44

Table 1: MSME sector’s contribution to Indian Economy

Year MSME Growth Total Share of Share of

GVA (%) GVA MSME in MSME in

GVA(%) GDP(%)

2011-12 2583263 810946 31.86 29.57

2012-13 2977623 15.27 920292 32.36 29.94

2013-14 3343009 12.27 10363153 32.26 29.76

2014-15 3658196 9.43 11481794 31.86 29.39

2015-16 3936788 7.62 12458642 31.60 28.77

Source: Central Statistics Office(CSO), Ministry of Statistics

and Programme Implementation

The MSME sector has been instrumental in generating

employment for women especially in the rural sector. Female

ownership is more in case of micro-enterprises compared to

small and medium enterprises. Distribution of enterprises in

rural and urban areas along with ownership is shown in the

table below:

Table 2: Distribution of Enterprises (Ownership) in rural and

urban areas

Sector Male Female All

Rural 77.76 22.24 100

Urban 81.58 18.42 100

All 79.63 20.37 100

Source: MSME Annual Report 2017-18

The NDA government is adopting policies that are aimed

at accelerating the MSME sector. The MSME Support and

Outreach Programme has the following salient features to

empower and facilitate a conducive environment for the

MSME entrepreneur:

●● Government will sanction loan up to 1 crore through

online portal

●● All GST registered MSMEs will get interest subvention

of 2% or fresh or incremental loans


ifimbschool.com

45

●● All companies with turnover of more than 500 crores

will be on TReDS platforms

●● All PSUs will have to procure 25% from MSME in

place of 20% of their purchase

●● 3% to be reserved for women entrepreneurs out of

25% purchase from MSMEs

●● CPSUs to procure from GeM Portal

●● Government will spend 6000 crores to establish

1000 technology centres

●● Government will set up pharma clusters

●● Annual filing of returns under 8 labour laws and

10 union regulations

●● Computerised random allotment will decide about

the establishment to be visited by the inspector

●● Single consent under water and air pollution laws

●● Entrepreneurs are exempted from approaching court

for minor violations under Companies Act

The government has recently doubled annual turnover

exemption limit for the composition scheme. The GST

council has doubled the GST exemption limit to Rs. 20 lakhs

from Rs. 10 lakhs and for North Eastern states to Rs. 40

lakhs from Rs. 20 lakhs. This is a major boost to the MSME

sector. Apart from these, some of the other schemes have

been started by the government are as follows:

1) development of khadi, Village and Coir:

There are many schemes under this programme to develop

the sector. These schemes are discussed below.

a) Market Promotion and Development Scheme

(MPDA)-This scheme has been launched by merging

different schemes. It includes publicity, marketing,

marketing promotion and marketing development

assistance.

b) Revamped Scheme of Fund for Regeneration of

Traditional Industries(SFURTI)-The main objective is

to ensure long term sustainability of traditional

industries.

c) Coir Vikas Yojana-The main objective is modernization

of coir industry, promoting export as well as

domestic market and also ensuring skill

development and welfare of artisans and coir

workers.

d) Coir Technology Upgradation Scheme: The objective

is to give assistance to the entrepreneurs to procure

modern plant and machinery.

e) Science and Technology Scheme for Coir: The

objective is that outcome of research should be

applied at the field level

f) Skill Upgradation and Mahila Coir Yojana: It provides

self-employment opportunities to rural women.

g) Export Market Promotion: The objective is to improve

export performance of the sector.

h) Domestic Market Promotion: The objective is to

popularise coir in the domestic product

2) Technology Upgradation and Quality Certification:

There are many schemes under this programme

which are discussed in details below.

a) Financial Support to MSMes in ZeD Certification

Scheme: Under this scheme, Zero defect and Zero

Effect practice is encouraged. So, Financial

support is given to ensure better quality and

reduction in wastages.

b) A Scheme for promoting Innovation, Rural Industry

and Entrepreneurship (ASPIRE): The main objective

is to reduce unemployment by creating more jobs.

The other objective is to promote entrepreneurship


ifimbschool.com

46

culture in India and promoting development at

Bottom of Pyramid (BoP) and encourage innovation

to strengthen competitiveness of MSMEs.

c) Credit Linked Subsidy for Technology Upgradation:

It provides 15% subsidy if there is additional

investment up to Rs 1 Crore for upgradation of

technology.

d) ISO 9001/14000 Certification Reimbursement:

This scheme reimburses charges incurred for

acquiring the certificates.

e) Marketing Support/ Assistance to MSMEs

(BAR CODE): This scheme reimburses charges for

acquiring Bar Code by MSMEs to encourage them

to use Bar Codes.

f) Lean manufacturing Competitiveness for MSMEs:

The objective is to encourage application of lean

manufacturing techniques to ensure competitiveness

of the firms.

g) Design Clinic for Design Expertise to MSMEs:

The objective is to increase competitiveness through

design thinking.

h) Technology ad Quality Upgradation support to

MSMEs: The objective of the scheme is to

encourage use of energy efficient technologies

(EET) in manufacturing units to reduce the cost of

production

i) Entrepreneurial and Managerial Development of

SMEs through Incubators: The objective is to

nurture innovative business plans which have the

capacity to commercialize in one year.

j) Adoption of QMS and QTT: The scheme

encourages MSMes to adopt Quality


ifimbschool.com

47

Management Standards (QMS) and Quality

Technology Tools( QTT).

k) Building Awareness on Intellectual Property Rights

(IPR): The objective to create awareness about IPR

and MSME sector can protect their own innovations

and ideas.

3) market Promotion schemes: There are many sun

schemes under this scheme which are discussed

below:

a) International Cooperation Scheme: The scheme covers

visit and participation of MSME delegates to other

countries in Trade Fairs or International exhibitions.

It also includes holding of International conferences,

summits and workshops.

b) Marketing Assistance Scheme: The scheme provides

assistance for organizing or co-sponsoring of

exhibitions abroad. It is also involved in buyer-seller

meet and conducting promotional activities.

c) Procurement and Marketing Support Scheme: It

encourages MSMEs to develop domestic markets,

to facilitate market linkages and to be aware about

trade fairs.

4) entrepreneurship and skill development Programme

(esdP) : This scheme tries to encourage youth to set

up their own enterprise.

5) assistance to training institutions ( asi): Under

this scheme, assistance is provided to National Level

training institutions like KVIC, NIMSME by providing

them with capital to develop their infrastructure.

6) infrastructure development Programme: Under this

programme, there is Micro and small enterprise

cluster development scheme ( MSE-CDP). The

objective is to enhance competitiveness and

productivity of MSME sector.

By 2020, the population of India is expected to be 1.35

billion, of which 906 million will be of working age (between

the age of 15 and 64 years). By 2030, India will be the

youngest nation with two-third of the population forming

the working-age population. Creating jobs for them will be

extremely important.

Only 10% of the graduates and 25% of the engineers

and MBAs are employable now (FICCI-EY Report, 2015).

Employability is a major problem. Hence, creating jobs for

young and aspiring population will be a challenge for the

government of India.

To address these head-up the government has announced

Skill India campaign on 15th July 2015 to train 40 crores

people in different skills by 2022. MSME sector which is

the largest generator of employment can play an important

role in rural as well as urban sector. The government has

come up with effective policies to develop the sector. These

superlative initiatives of the government are having a positive

impact on the MSME sector. The MSME sector will become

more vibrant under the NDA government and continue to

play an important role in the future.

References

1. State-focused roadmap to ‘India’s Vision 2030’ (FICCI

Higher Education Summit Report).

2. Sustainable Development Goals: Agenda 2030 – India

2017 (A Civil Society Report).

3. PwC Report ‘The world in 2050: Will the shift in

economic power continue?’

4. Indian workplace of 2022: Are organisations ready for the

future?

5. MSME Annual Report 2017-18

Data Sources:

Bloomberg Database

www.data.gov.in

www.data.worldbank.org


ifimbschool.com

48

Over the last two decades, India stood out due to

the dynamism of the services sector. The services

sector has been the vital cog for an accelerated

growth. The Economic Survey reports reveal

the sector has been led by the predominantly high-end,

knowledge-intensive services exports through well-trained

manpower. Its growth has been better than other sectors.

From 1950-51 to 1999- 2000, the economy experienced

a change in its structure with a shift away from agriculture

towards manufacturing and services.

The services sector, with 55.2% in India’s gross value-add

continued to be the key driver contributing almost 72.5%

of growth in 2017-18. While this sector is expected to grow

8.3% in 2017-18, the growth in services exports and net

services were robust at 16.2% and 14.6% respectively in H1

of 2017-18. As per the UN National Accounts Statistics data,

Services Sector in India: A Story of Dynamic Growth

Balanced Services Sector Growth

dr. Chetan Bajaj & dr. rema goPaLan

India’s ranking improved from 14th in 2006 to 7th in 2016,

from among the 15 largest economies.

As per the First Advance estimates of national income

2017-18, services sector growth (GVA at constant (2011-

12) basic prices) is expected to be 8.3% during 2017-18,

higher than the 7.7% in 2016-17. The growth in trade,

hospitality, transport, communication and services related to

broadcasting is expected to be 8.7% in 2017-18 compared

to 7.8% in 2016-17 and growth in the ‘financial, real estate

and professional services’ is likely to be 7.3% in 2017-18,

from 5.7% in 2016- 17.

‘Public administration, defence and other services’ registered

a growth of 11.3% in 2016-17 as against 6.9% in 2015-

16, owing to higher payments due to the Seventh Pay

Commission. This growth is expected to decelerate to 9.3%

in 2017-18, on a high base of 2016-17 (Table 1).

Note: Shares are in current prices and growth in constant

2011-12 prices; @ Provisional Estimates for 2016-17; #

First Advance estimates, * Also includes transport, storage,

communication and services related to broadcasting; ^Also

includes Real estate, ownership of dwelling and professional

services.

As per the latest WTO data for first half of 2017, services

export growth was 4.3% (average of Q1 and Q2) and robust

at 9.9% for India.

India remained the eighth-largest exporter of commercial


ifimbschool.com

49

Table 1: Share and Growth of India’s Services Sector (GVA at basic prices)

Share (Per cent) Growth (%)

2015-16 2015-16 2016-17@ 2017-18#

Total Services 52.9 9.7 7.7 8.3

Trade, repair, hotels and restaurants 11.4 11.2 7.8* 8.7*

Trade & repair services 10.4 10.9 — —

Hotels & restaurants 1.0 14.4 — —

Transport, storage, communication & 7.0 9.3 — —

services related to broadcasting

Railways 0.8 7.0 — —

Road transport 3.2 6.7 — —

Air transport 0.2 16.8 — —

Financial services 5.8 6.8 5.7^ 7.3^

Real estate, ownership of dwelling &

professional services 15.3 12.5 — —

Public Administration and defence & Others 13.4 6.9 11.3 9.4

Construction 8.1 5.0 1.7 3.6

Total Services (including Construction) 61.0 9.1 6.9 7.7

TOTAL GVA at basic prices 100.0 7.9 6.6 6.1

GDP Market Prices Constant Prices) Y-o-Y 8.0 7.1 6.5

Source: Computed from CSO data.

services in 2016 (WTO, 2017) with a share of 3.4% which is

double India’s merchandise exports at 1.7%. Moreover, the

ratio of services exports to merchandise exports increased

from 35.8% in 2000-01 to 58.2% in 2016-17. While India’s

services exports registered a CAGR of 8.3% from 2006-

07 to 2016-17, in 2015-16 it contracted (-)2.4%. Services

sector export growth was 5.7% in 2016-17. Services exports

saw robust growth of 16.2% in April-September 2017-18.

(Table 3).

Major Services Sector-wise performance and some recent

government policies to boost growth:

Tourism

India’s Tourism sector is thriving, with Foreign Tourist Arrivals

(FTAs) growing 9.7% to 8.8 million and Foreign Exchange

Earnings (FEEs) at 8.8% to USD 22.9 billion in 2016. FTAs

during 2017 was 10.2 million, growing 15.6%, while FEEs

from tourism was USD 27.7 billion, growing 20.8% over

2016. Domestic tourists grew 12.7% to 1,614 million in 2016

from 1,432 million in 2015. Tamil Nadu, UP, AP, MP and

Karnataka were the Top 5 Destinations in 2016.

Various initiatives have been taken to promote tourism,

including e-Visa facility under three categories of Tourist,

Medical and Business for citizens of 163 countries; launch

of Global Media Campaign for 2017-18 across TV Channels;

launch of ‘The Heritage Trails’ to promote World Heritage

Sites; launch of International Media Campaign on various

TV channels; Celebration of ‘Paryatan Parv’ having three

components -- Dekho Apna Desh’ for Indians, ‘Tourism

for All’ with onsite events across states, and ‘Tourism &

Governance’ with interactive sessions and workshops with


ifimbschool.com

50

stakeholders. FTAs on e-Tourist Visa grew 143% to 1.08

million in 2016, and further grew 57.2% to 1.7 million during

2017.

IT-BPM

India’s IT – Business Process Management (IT-BPM) industry

grew 8.1% in 2016-17 to USD 139.9 billion (excluding

e-commerce and hardware) from USD 129.4 billion in 2015-

16, as per Nasscom data. IT-BPM exports grew 7.6% to

USD 116.1 billion during the period. E-commerce market is

estimated at USD 33 billion, with a 19/1% growth

in 2016-17.

To boost the sector, many initiatives have been taken,

including establishing a BPO Promotion and Common

Services Centres to help in digital inclusion and equitable

growth and provide employment to 145,000, mostly in small

towns; setting up a separate Northeast BPO promotion

Scheme with 5,000 seats; preparing the draft Open Data

Protection Policy law besides long-term initiatives like Digital

India, Make in India, Smart Cities, e-Governance, Skill India,

drive towards a cashless economy and efforts to kindle

innovations.

Real Estate

The Real Estate sector secured FDI of USD 257 mn in H1

2017, double of 2016. Some recent reforms and policies in

Real Estate Sector include the Pradhan Mantri Awas Yojana

(PMAY) with the government sanctioning over 3.1 million

houses in the affordable housing segment in urban regions

till November 2017.

Of this, foundation stones have been laid for about 1.6

million houses and about 0.4 million houses have been built.

PPP policy for affordable housing was to give an impetus to

the ‘Housing For All by 2022’ mission. Credit-Linked Subsidy

Scheme (CLSS) under PMAY was extended to the Middle

Income Group (MIG) which was included in the scheme from

1st January 2017. With the enactment of the Real Estate

(Regulation & Development) Act, 2016, it is anticipated that

accountability would lead to higher growth across the value

chain while disclosures and registrations would ensure

transparency.

R&D

The professional Scientific & Technical activities which

include R&D services grew 17.5% and 41.1% in 2014-

15 and 2015-16 respectively. India-based R&D services

companies, which account for almost 22% of the global

market, grew 12.7%. However, India’s gross expenditure on

R&D has been around 1% of GDP. India ranks 60th of 127

on the Global Innovation

Index (GII) 2017, improving from 66th rank in 2016.

Buoyed by the government’s support through Schemes of

different Ministries/Departments, the R&D sector in India is

set to witness robust growth in the coming years. According


ifimbschool.com

51

to a study, engineering R&D market in India is estimated

to grow at a CAGR of 14% to USD 42 billion by 2020 for

dedicated research centres for R&D in these sectors.

Space

As of March 2017, PSLV successfully launched 254

satellites. Foreign exchange earnings from satellite launch

services increased noticeably in 2015-16 and 2016-17 to

INR 394 crore and INR 275 crore from INR 149 crore in

2014-15.

India’s share in global satellite launch services has also

increased to 1.1% in 2015-16 from 0.3% in 2014-15. Antrix

foresees greater utilization of its launch services for launching

their Low Earth Orbit (LEO) satellites.

Major Initiatives

The PM stated India’s priority is to work towards trade

facilitation agreements (TFA) for services for easier movement

of professionals.

The Government has adopted a few initiatives in the recent

past. These include:

●● Under the Mid-Term Review of Foreign

Trade Policy (2015-20), government increased

incentives under Services Exports from India

Scheme (SEIS) by 2 per cent.

●● India is working to remove trade barriers

to services.

Services sector growth is governed by domestic

and global factors. The Indian facilities management

market is expected to grow 17 percent CAGR

between 2015 and 2020, and surpass USD 19

billion mark supported by a booming real estate,

retail, and hospitality sectors.

The implementation of the Goods and Services Tax

(GST) has created a common national market and

reduced the tax burden on goods.

Over all the initiatives in the services sector have been multi

directional reducing the single sector overdependence like IT

BPM. This ensures incidence of the service sector to impact

to a wider range of geographies of the country.


ifimbschool.com

52

Is cleaning only the responsibility of the karamcharis?

Do citizens have no role in this? We have to change this

mindset”, said Prime Minister, reaching out to citizens

across the country, on the auspicious occasion of

Gandhi Jayanti in 2014. The Father of the Nation, considered

cleanliness as an act of the highest value, that next to

Godliness. He famously said, “Sanitation is more important

than independence.” The Swachh Bharat Abhiyan is

perhaps, the most striking resemblance to a highly Gandhian

ethos, prevalent in the DNA of the current government.

What started as a crowdsourced initiative, by the Prime

Minister inviting nine prominent citizens (namely, Sachin

Tendulkar, Anil Ambani, Ramdev, Shashi Tharoor, Mridula

Sinha, Kamal Haasan, Priyanka Chopra, Salman Khan

and the team of Tarak Mehta Ka Oolta Chashma) and then

Swachh Bharat: Ensuring Cleanliness &

Dignity for Ordinary CitizensInstilling National Pride

“

Sumantra BaSu

on being extended to the rest of the citizenry. With a total

budget outlay of Rs. 60,000 crore, the Swachh Bharat

Mission or Clean India Mission aims to end open defecation

forever in all villages by 2nd October, 2019.

The progress of the Abhiyan has been impressive to say the

least— as of now 1.13 million toilets have been built across

India. A similar method of gathering and verification of data

is used by the Ministry of Drinking Water and Sanitation,

who under Swachh Bharat Mission – Gramin (rural) as of

now, have built 92.5 million toilets pan-India, with over half a

million villages being declared Open Defecation Free (ODF).

As a result, sanitation coverage in the rural areas has risen

from 38.7 percent (October 2, 2014) to over 98 percent.

It is worthwhile to note that, independent third party

survey by the Bill and Melinda Gates Foundation states

that incidence of water-borne illnesses such as diarrhea

was significantly lesser in the Open Defecation Free

(ODF) villages, as compared to that in non-ODF villages.

Another survey by the Unicef concluded that an ODF

village household could be gaining as much as Rs. 50,000

per annum as a result of lower incidence of illness and

consequent lower income loss.

Although on April 1, 2000 the then government launched

the Total Sanitation Program (TSC), it was renamed Nirmal

Bharat Abhiyan by the UPA government under Manmohan

VeRTICAl HeAD- eDUCATION & INFRASTRUCTURe, INTeGRATeD BRAND-COMM


ifimbschool.com

53

Singh. A study of 80 villages in Madhya Pradesh showed

that the TSC programme modestly increased the number

of households with latrines, and had a small effect in

reducing open defecation. The low decibel rural sanitation

program was restructured as Swachh Bharat Abhiyan

on 24 September, 2014, amid much fanfare as the NDA

government focused on awareness and participation for

success of the same.

Under PM Modi, the national campaign was conceived in

March 2014 at a sanitation conference of UNICEF India and

the IIT as an inclusion of the larger Total Sanitation Campaign

or Nirmal Bharat Abhiyan which the previous government

had launched in 2000. The chief objectives of SBA was

to eliminate open defecation through the construction

of household-owned and community-owned toilets and

incorporating a mechanism to monitor toilet use.

The mission would help India reach Sustainable Development

Goal 6 (SDG 6) set by the UN in 2015. The wave of SBA

is India’s largest cleanliness drive to date with over 3

million government employees, and students from across

India participating in 4,041 cities, towns, and rural areas.

The PM called the campaign Satyagrah se Swachhagra,

which translates to ‘From Insistence on Truth to Insistence

on Cleanliness’, with reference to Gandhi’s Champaran

Satyagraha launched on 10 April, 1917.

National Mission for Clean Ganga (NMCG) and a lot of other

river cleaning projects have been undertaken as part of the

mission which has resulted in the holy rivers of India including

the Yamuna, the Narmada, the Brahmaputra, becoming

cleaner. As the flow of garbage is prohibited under the

project, $3 billion has been allotted to clean the waterways

that shall meet the needs of 400 million Indians.

The Swachh Bharat Mission has been a success, mainly on

account that it has two thrusts: Swachh Bharat Abhiyan-

Gramin or Rural under the Ministry of Drinking Water and

Sanitation, and Swachh Bharat Abhiyan-Urban, which

runs under the Ministry of Housing and Urban Affairs.

Swachhagrahis or “ambassadors of cleanliness” have

promoted indoor plumbing and community approaches to

sanitation in villages.

National real-time monitoring and updates from non-

governmental organizations (NGOs), who believe in the

mission’s goal, such as SWaCH Pune (Solid Waste Collection

and Handling), The Ugly Indian and Waste Warriors, are

aiding the mission.

For a very long time, open defecation and contamination of

water have been a problem dogging India. With 530 million

people contributing and being impacted by it, the country

ranked high on the charts, with the highest number of


ifimbschool.com

54

people defecating in the open. Many of the countries that

are economically less-developed rank better in this metric.

The Swachh Bharat Abhiyan has been critical in reducing the

number of persons who defecate in the open to fewer than

150 million in 2018.

The maximum funds under the Swachh Bharat Mission

– Gramin, for 2018-19 were released to Uttar Pradesh at

INR 6,592.64 crores and Bihar at INR 2,943.69 crores. The

villages under the radar are facing the problem of open

defecation due to a lack of toilets whereas the urban areas

are prone to another critical problem i.e. improper wastage

disposal that is causing vector-borne diseases. An organized

funding is therefore, most probably needed to achieve the

overarching goals of the mission.

PPP or Public-Private Partnership has thus far, proven to be

an effective model of delivery. Private partnership through

Corporative Social Responsibility supports the municipal

corporations in maintaining sanitation of new and existing

public toilets.

Also industry-academia collaboration has been a factor

in driving innovation. A prime example is the BOT model

where 45 custom-designed robots were created by nearly

270 students of IIT-Madras. They made robots capable of

sweeping an area of 750 square feet in just 15 minutes.

GenRobotics, a young startup from South India under the

Kerala Startup Mission, created a robot, ‘Bandicoot’, in 2015

which can replace a human’s job of cleaning manholes. In

the light of deaths caused every year due to workers needing

to enter dangerous spaces which are full of toxic waste,

the municipal corporations across India have placed orders

for Bandicoot, at a price of about Rs. 18 lakhs to replace

humans to do heavy-duty tasks as the Bandicoot can collect

up to 20 litres of sewage in 20 seconds.

However, the community participation model has been the

most powerful in determining the success of the Swachh

Bharat Mission. Lakhs of schools and colleges pan-India

have carried out activities like drawing competitions for

children with the themes ‘Mahatma Gandhi’ and ‘Swachh

Bharat Abhiyan’ as well as cleaning drives to inculcate the

habit of cleanliness at a young age. Rallies have been held to

spread information.

PPP models can provide healthy, environment-friendly and

mutually-beneficial solutions for communities by replacing

the harmful with the harmless. With the government doing

its fair share and the private sector aiding Swachh Bharat

Abhiyan, change has been seen. Although the mission was

more about practical ways of dealing with sanitation and

public hygiene, it did not fail to stir conversations on online

platforms and increased active youth participation.

Although the impact of SBA can be witnessed on the

ground, there are statistics and reports of the government

which support the claims. The data found in Individual

Household Latrine (IHHL) report by the Ministry of Housing

and Urban Affairs, is provided by people who benefit from

the scheme by uploading pictures of the toilets that have

been built. These pictures are then scanned and verified.

The objective is ultimately not to build an abundance of

toilets, but to make as many villages open defecation free

as possible through a behavioral change as the absence

of it is responsible for the spread of diseases like diarrhea

and pneumonia that are responsible for several lakh children

dying every year.

It hardly comes as a surprise then, that India today is only

the third country in the world that as improved its Travel

and Tourism Competitive Index by double digits in a single

year. The initiative has had positive impact in improving the

surroundings around the places of tourist interest. Improved

sanitation and cleanliness of tourists spots is also a subtle

and win-win method to attract tourism and boost India’s

global perception.

With citizens turning out in large numbers to pledge for

a Swachh India, the paramount goal to achieve an Open

Defecation Free (ODF) India by the 2nd of October, 2019,

seems to be a plausible date. This date marks the 150th

birth anniversary of Mahatma Gandhi. To commemorate

and honour his vision of a clean India, the country with the

support of the government, has a year more to contribute to

this national movement of Swachh Bharat Abhiyan.


ifimbschool.com

55

A game-changer initiative to serve the poor” said

Prime Minister Narendra Modi, after the launch

of Ayushman Bharat in September 2018. A

marquee initiative by the government to bring

the large swathes of the population across India and Bharat

under the ambit of state healthcare, Ayushman Bharat is by

far, one of the most ambitious schemes undertaken by any

government in the history of Independent India.

Rolled out simultaneously in more than 450 districts across

the country, ‘Modicare’, as it is popularly touted, is estimated

to be the biggest government-funded health insurance

program globally. More than 100 million of India’s poorest

families – that’s some 500 million people and about 40%

of the population — will get free health coverage. The

insurance will cover more than 1,350 procedures including

cancer treatments, coronary bypass, angioplasty and knee

replacements. It will also include charges for pre-and post-

hospitalization, diagnostics, medicines, etc.

The benefits of the programme have a multitude of benefits

ModicareA Succour To The Poor

“

DR NINA JACOB

PROFESSOR, OB&HRM, IFIM BUSINESS SCHOOL

across layers, right from ensuring a healthy India to ensuring

a robust ecosystem for the healthcare and allied sectors.

Where on the one hand the common man benefits from

a state-sponsored treatment and insurance, Ayushman

Bharat ensures that the mainstream services of healthcare

and insurance also reach-out to the far-flung corners of the

country.

The programme is ambitious and far-reaching to say the

least. The number of beneficiaries to be covered under

this program are over 50 crore. Eligible families will get an

insurance cover of up to Rupees Five lakhs per year. By


ifimbschool.com

56

February 23, 2019, 14,724 government hospitals have been

empaneled by the scheme.

The Ayushman Bharat Yojana doesn’t just have a national

focus. It is an instrumental tool for the country to ensure

that the third Sustainable Development Goal of the United

Nations, (SDG-3). The SDG-3 seeks to “ensure healthy lives

and promote well-being for all at all ages”.

The PMJAY scheme, on its final rollout shall ultimately cover 40% of India’s population.

The PMJAY scheme, on its final rollout shall ultimately cover

40% of India’s population.

The Government has gone a step further to ensure that

the citizens benefit from the total stack benefits of state

focused reforms. For instance, clubbing PMJAY with the

Government’s focus to provide medicines at a nominal cost,

through the Jan Aushadi Scheme.

Affordable medicines have been made available at the PM

Bhartiya Janaushadi Kendras. These kendras sell medicines

at almost half the price of branded medicines. At the time

that Narendra Modi became prime-minister, there were only

97 such kendras.

Today, more than 3,000 Janaushadi Kendras have been

established The medicines sold by the kendras are generic

in nature, but identical to branded medicines. Costs are

kept low through the non-incurrence of the research and

development costs that branded pharmaceutical companies

incur. Nonetheless, all the drugs are conformed as per the

World Health Organisation (WHO) standards.

More than 3,000 Janaushadi Kendras have been established since the inception of the programme.

More than 3,000 Janaushadi Kendras have been established

since the inception of the programme.

Thus far, till the publishing of this report, over 52 lakh

people have benefited from the AMRIT (Affordable Medicine

and Reliable Implants for Treatment) pharmacies. These

government-owned outposts provide affordable medicines

for the treatment of cancer and cardiovascular diseases.

There are, as of January 2018, 111 AMRIT pharmacies.

The discounted prices at which AMRIT pharmacies sell

their medicines is about 60 per cent to 90 per cent of their

maximum retail price. At inception itself, AMRIT pharmacies

were selling 195 oncology drugs and 186 cardiovascular

drugs at deep discounted prices. ‘Docetaxel 120 mg’ used

for chemotherapy is sold at Rs 888.75 (93 per cent rebate),

when the MRP of the injection is Rs. 13,440.”

5,200 drugs, implants, and disposables are sold at discounts of up to 60 per cent of MRP.

5,200 drugs, implants, and disposables are sold at discounts

of up to 60 per cent of MRP.

In 2015, the government published the National List of

Essential Medicines (NLEM) which has brought 1,054

essential medicines under governmental price control.

Medicines not deemed essential by the NLEM 2015 are

also subject to price control. It is thus, not possible for

pharmaceutical companies to raise the price of even non-

essential drugs indiscriminately.

Meanwhile, more steps are being taken to ensure that

essential medicines are sold at a fair price. The Department

of Pharmaceuticals’ report titled ‘Report of the Committee

in High Trade Margins in the Sale of Drugs, 2016’ observes

that “high trade margin enjoyed by distributors-hospital/

retailers are the main reason for cost escalation of drugs and

medical devices”. As indicated by the work being done at

NITI Aayog, the government is in process of initiating trade

margin rationalization in the pharmaceutical industry.

This programme provides free dialysis services to the poor,

and subsidized services to all patients. The free dialysis

services are provided in district hospitals and are available

in about 500 such district hospitals. About 2.5 lakh patients


ifimbschool.com

57

have availed this service. About 500 dialysis units have been

made operational.

Around 52 lakh pregnant women will benefit from the

‘Pradhan Mantri Surakshit Matritva Abhiyan’ every year. This

scheme provides BPL women with an annual cash incentive

of Rs. 6,000 each. The money is to be used by expecting

mothers for the purchase and preparation of wholesome,

nutritious food during their pregnancy.

As of now, only mothers expecting a first-born are eligible.

BPL mothers expecting a first-born have a legal claim to this

incentive under the National Food Security Act (NFSA). This

scheme is being executed through the Maternity Benefits

Program (MBP).

The scheme was announced on January 1, 2017 and

received approval from the Union Cabinet in May 2017.

Through the Pradhan Mantri Surakshit Matritya Abhiyan

and Maternity Benefits Programme, the high maternity

mortality rate in India shall decrease. The money is given to

the beneficiaries through direct bank transfers (DBT), thus

mitigating leakages.

1.3 crore ante-natal tests were conducted.

84 lakh hemoglobin 15 lakh ultrasound checkups tests were conducted

The Narendra Modi-led government has reduced the prices

of cardiac stents by 85 per cent, and knee implants by 50 –

70 per cent. The maximum price of cardiac stents was set at

Rs. 30,000 in February, 2017.

The National Pharmaceutical Pricing Authority (NPPA) has

fixed the price of drug eluting stents and bare metal stents

at Rs.27,890 and Rs.7,400 respectively. Earlier, a coronary

stent could cost as much as Rupees two lakhs. The NPPA

has reduced the prices of coronary stents in 2018 by 85 per

cent.

A September 2018 study by TALENT has shown that low-

priced Indian stents are as good as the ones produced by

well-known multinational companies. Thus costlier is not

necessarily better.

The unique component of Health and Wellness Centres

(HWCs), at the initial phase and financial protection for

accessibility to curative care at the secondary phase,

through collaboration between the public and the private

sector, is a salient feature of Modicare. These features shall

have a catalysing effect on startups and disruptive players in

the healthcare sector.

Modicare is a giant stride towards ensuring India’s evolution

as a free-market democracy that places unfettered focus

on the well-being of its citizens. The Prime Minister has, in

his Vision 2022 promised to make India poverty-free. What

better way than to begin with implementing reforms that

aims to tackle poverty through healthcare?


ifimbschool.com

58

Chalking A Strategic Roadmap to Provide Housing

for All by 2022

Pradhan Mantri Awas Yojana would benefit people

who cannot afford a house themselves. It is a

step towards fulfilment of the vision of Housing

for All by 2022”, said Prime Minister Narendra

Modi, highlighting the impact of the marquee initiative by

the government, to ensure that no individual or family would

remain without a shelter.

The Pradhan Mantri Awas Yojana was launched with the

objective of rehabilitating the present slum dwellers, with the

participation of the private sector, using land as a resource,

promoting affordable housing for the weaker sections of the

society through various credit linked subsidies, providing

affordable housing by forming partnership between the

government and the private sector.

Even decades after political independence, millions of Indians

“

rajarshi-ChakraBorty

ASSISTANT PROFESSOR, IFIM BUSINESS SCHOOL

have been deprived of the basic necessity of a shelter, to

survive. Even though the country witnessed superlative

economic growth and progress, it still ranked extremely

poorly in the HDI (Human Development Index), which was a

measure of human development in terms of education, life

expectancy and per capita income. As per the HDI report,

India was at 0.467 in 2008; meanwhile, in 2018 it rose to

0.639, a substantial leap of 36%.

The evolution of the various housing schemes by the different

governments can be divided into four distinct phases; the

first phase consists of the developments that took place

during the first two decades post-independence. This was

the period when the initial schemes and policies of the

government were still being formulated and the government

was trying to analyse and attend to the problems of various

segments of the society. The second phase was between

the early 1970s till the middle of the 1980s; during this

period, the attention shifted to serve the weaker sections of

the society.

The third phase was between the middle 1980s till the early

2000s and during this period the focus was shifted from

physical provision of houses to financing the same.

The fourth and the final stage was from early 2000s

onwards. During this phase it was clearly visible that

the government was promoting active involvement and

participation of the private sector in providing houses to

the needy, but surprisingly the government reduced its

involvement from these housing activities.


ifimbschool.com

59

1950s – 1960s (1st Phase)

During the first phase, the central government came out

with certain housing schemes which was aimed at providing

housing facilities to all the sections of the society. Some of

the prominent schemes that the central government came

up with are the Subsidized Housing Scheme for Industrial

Workers in 1952, Low Income Group Housing Scheme in

1954, Middle Income Group Housing Scheme in 1959 and

Slum Clearance and Improvement Scheme I 1956.

The responsibility and accountability were rendered to the

state governments for housing in the rural areas. During the

first phase there was a lot of focus in the development of

institutional capacities to effectively manage the growth in the

urban areas and also to deliver proper and livable housing to

the citizens of the country.

In view of this, the Central Government had established

plenty of institutions at the state as well as the national

levels including the National Building Organization, which

was established in 1954 and whose main function was to

conduct extensive research in building construction

activities.

The early 1960s witnessed the establishment of the Town

and Country Planning Organization and also various Housing

Boards were established during the same period. The

primary objective of these Housing Boards was to perform

various housing activities for various sections of the society

with a special focus on the Lower Income Group.

1970s – Mid 1980s (2nd Phase)

The second phase witnessed a rapid decline in the number

of Housing Schemes and policies post-realization by the

Government that it was quite challenging to provide housing

for all the sections of the society. There was a visible decline

in the schemes and policies that were established by the

government for different sections of the society apart from

the weaker, poor and the socially backward sections of the

society.

The phase projected a complete shift of focus to various

housing schemes and activities aimed at the lower sections

of the society and the other sections were encouraged

to get into several housing activities with limited support

from the government. It was also during this phase that

the government realized that slum clearance was not the

ultimate solution to the housing problem in the cities.

The government came out with schemes like Environmental

Improvement Scheme of Urban Slums in the year 1972 and

Sites and Services Scheme in the year 1980 to counter the

problems with regard to the urban slums. During this phase

it was also noted by the Government the positive impact of

housing on the overall economic growth of the country and

hence the Government created the national level Housing

and Urban Development Corporation (HUDCO) in the year

1970.

The objective of establishing HUDCO was to ensure the

promotion of a sustainable development of Urban India and


ifimbschool.com

60

a remarkable improvement in the quality of life of the citizens.

As of now HUDCO had built around 3,86, 201 units as per

the September 2018 report released by HUDCO.

Mid 1980s – Early 2000s (3rd Phase)

The third phase was more about liberalization of the Indian

economy. The government was focused on liberalizing the

economy and this phase witnessed the entrance of various

neoliberal policies in India. The economic liberalization was

also visible in the housing policies as well.

Several housing policies were focused upon restricting

government interference in housing activities as a provider

of houses and the policies were aimed at promoting the

government as a facilitator in the housing process. The focus

was shifted towards the private sector and their efforts in

providing houses.

This phase also witnessed the restriction of the role of

government and narrowing their focus only on improvement

of the slums, providing houses directly to the weaker

sections of the society and providing lots of support and

motivation to the various housing finance institutions. This

phase also witnessed the emergence of various schemes

like Urban Basic Services Scheme (renamed to Urban Basic

Services for Poor in 1991) which was established in the year

1986, Nehru Rozgar Yojna’s Scheme of Housing and Shelter

Upgradation, established in the year 1990 and the National

Slum Development program, established in the year 1996.

Even though these schemes were designed by the center,

it required matching fund requirements from the state

governments and this created a lot of challenges in the

implementation of these schemes. This phase witnessed

the establishment of the National Housing bank in 1987 and

along with it various commercial banks and housing finance

institutions came into existence and they were constantly

encouraged.

2000s onward (4th Phase)

During this phase the government had already established

itself as the facilitator of housing activities. The government

had also stated that there is insufficiency of funds in it to

support the extensive urban development and housing

activities and hence the focus was on attracting the private

sector to invest in the sector.

This phase witnessed the establishment of schemes like

Valmiki Ambedkar Awas Yojna, which was merged with

BSUP (Basic Services to Urban Poor) and later to JnNURM

(Jawaharlal Nehru National Urban Renewal Mission) and

finally it was merged with Rajiv Awas Yojna in 2013.

This phase also witnessed the allowance of 100% FDI in

the housing sector. The government had also declared slum

improvement as a Corporate Social Responsibility activity

with the main objective of attracting more and more funds

and investments from the private enterprises. Surprisingly it

was reported recently that more than two lakhs units are still

unoccupied under the Rajiv Gandhi Awas Yojana.

The Impact

Post our independence for the first time we saw a clear and

well defined vision post the launch of the Pradhan Mantri

Awas Yojana on 17th June, 2015, by the NDA government.

The launch happened with a clear vision of providing a

shelter to every Indian by 2022, when the country turns 75

years. The scheme covers aspects of affordable housing,

basic facilities like proper sanitation, basic infrastructure and

a secured environment.

For the first time in the history of our country, the quantum of

home loan touched 10% of the Gross Domestic Product due

to a steep growth in housing credit. The home loan segment

has been growing robustly and it is only accelerating at a

rapid pace due to the growth in the affordability factor.

The Middle Income Group 1 with an average annual income

of Rupees six lakhs to Rupees 12 Lakhs, which are mainly

for the youth population up to the age of 35, are eligible for a

subsidy for homes which are upto 1722 square feet and the

Middle Income Group 2 with an average income of Rs. 12

Lakhs to Rs. 18 Lakhs, who generally belong to the middle

age category, are eligible for a subsidy for units that are upto

2,153 square feet.


ifimbschool.com

61

If we look examine the MIG-1 category, customers are

eligible for a 4% interest subsidy for a loan amount of

Rupees nine lakhs and for the MIG-2 category, customers

are eligible for a 3% subsidy for a loan amount of upto

Rs. 12 Lakhs. If the customer requires any additional

loan amount, he will be given by the lender but at a non-

subsidized rate.

The Pradhan Mantri Awas Yojana is benefitting the citizens

in a multitude of ways. It is definitely providing affordable

housing opportunities to those from all sections of the

society. It is also helping the customers get a better value for

their money as the scheme helps increase the average size

of the house by 20%-30% considering the ratio between the

super built up and the carpet area.

An increase in the carpet shall encourage the customers,

especially from the tier I and tier II cities in various aspects.

The scheme has initiated a great impact on the real estate

sector as well as the industries associated with it. Following

are the benefits designed for the economically Weaker

Section (EWS) of the society and the Lower Income Group

(LIG) segment.

It has been reported by the National Institute of Public

Finance and Policy that the time required for the construction

of house under the Pradhan Mantri Awas Yojana has been

reduced to 114 days from a staggering 314 days, which was

prevalent under erstwhile Indira Awas Yojana. The following

table will give us an idea about the upwards swing in the

construction of houses under the Pradhan Mantri Awas

Yojana.

The above table gives us a clear view of the growth of

Pradhan Mantri Awas Yojana and gives us the confidence to

believe in the success of the scheme.

Around 1.13 crore houses have been constructed in the

last four years and the Government has set a target of

constructing 1 crore pucca houses by 31st March 2019,

which is very much in the process if we consider that out

of the targeted 1 Crore pucca houses by 31st March 2019,

the targets that are assigned to all the states and Union

territories are 99.89 Lakhs, the houses sanctioned so far has

been 87.44 lakhs.

Out of these sanctioned houses, first installment is paid

for 81.26 Lakhs houses, 2nd installment is paid for around

62.52 lakhs and 3rd installment is paid for 49.17 lakhs

houses. Around 43.54 lakhs houses are completed source.

These are very promising numbers that shows that the

Government is on track towards the completion of the target,

that is to provide shelter to all the citizens of India by 2022,

the year India turns 75.

If we also look at the state wise allocation of houses under

the Pradhan Mantri Awas Yojana, the figures are quite

promising. Following is the data released by the Government

with regard to the progress of Pradhan Mantri Awas Yojana

state wise

From the above tables it is very clear that the progress is

strong enough but the question that remains in everyone’s

mind is that whether the Government will be able to

construct 1 crore urban houses by 31st March 2019. Well,

the progress has been good but it is extremely necessary for

the Government to speed up the entire process if it has to

meet its target.

For the impact to be more effective there is a serious need

for the government to create an enabling ecosystem for

the private builders. For the government to reach its goal


ifimbschool.com

62

of constructing 2 crore homes by 2022, it needs to build

houses at a rate of 30 lakhs per annum.

One of reasons for this slow rate of growth is the

government’s excessive dependence on the private players.

The government is offering and funding upto Rs. 1.5 lakhs

per house, which is not motivating enough for the private

builders as if we consider cities like the metropolitans, one

cannot have that cheap a price for a house.

There is an uncertainty that exists as to whether the state

governments shall fund this scheme and hence the entire

onus falls on the private builders that demotivates them.

It has also been noted that around 16 lakhs houses are

sanctioned for construction by the government for a budget

of around Rs 89 crore out of which the government will be

funding around a fourth of it.

The Way Forward

One of the major initiatives that the government should resort

to in order to speed up the process of affordable housing

is by encouraging private builders to participate even more.


ifimbschool.com

63

There is a need for the Government to streamline the overall

approval process.

At present it takes a lot of time for the developers to start the

construction of the house after purchasing the land and it is

common experience for them to go through various offices

of the government before they start the construction and

therefore causing a major delay.

There is a need for the government to think about starting

with a transparent online approval process that aims at

saving time for the overall approval and should also aim at

stopping any form of unethical practices. One of the major

obstructions faced by the private developers is the availability

of roads, sewage and water along with the land.

There is also a need for the state governments to take care

of these issues if we want to see a heavy influx of private

builders. There is also need to revisit the early 2000s and

introduce something similar to what was introduced by the

then Prime Minister Shri Atal Bihari Vajpayee, Section 80 IB

(10), of the Income Tax Act, that aimed at the promotion of

the construction of housing projects.

Providing affordable housing is not only about providing a

roof over the heads of the citizens but also about creating a

positive and favorable correlation with the economy of the

nation. The initiative provides the window for people from

rural and semi-urban areas to migrate to the larger urban

centers for employment.

Affordable housing is a powerful initiative to strengthen

the economic status of any city as well as the real estate

sector. Creation of a talented manpower pool will help in

increasing the demand of opening up of various industries

and businesses in the cities.

It shall also witness a rise in the demand of retail spaces

around the catchment areas. Affordable housing is also

going to promote its beneficial coexistence with the middle

income households since the middle income groups depend

on the services of the lower income group on a daily basis.

There has also been a steep rise in the housing activity for

the economically weaker section of the society in and around

the more affluent housings in the major cities.

Providing affordable housing is definitely a boost to the

economic strength of the country and it also enhances

the livelihood of the several people. Even though we have

witnessed a lot of established builders are getting benefitted

from the Pradhan Mantri Awas Yojana, several small time and

unorganized builders are utilizing the Yojana as their playing

ground and they are not following any particular rule book.

The main objective of these small time builders is to buy

land pieces around the outskirts of the major cities and then

build small housing projects that lack the most elementary

amenities and facilities. These housings are devoid of the

most basic services like water, connectivity through roads

and electricity since they fall well outside the municipality

limits.

With the vision of housing for all by 2022 it should be the

primary duty of the government to keep a check on illegal

builders and housing projects that are being constructed to

fool customers to a large.

There is a high shortage of land to implement this scheme

and till the time enough lands are released to the government

for the smooth implementation of this scheme, the vision

might remain a distant dream for many beneficiaries as well

as for the government.

Cost of the land forms a major chunk of the overall ticket-

size of the housing project. With the RBI not allowing the

banks to sanction loans for the purchase of land, the builders

are left with very few options of either forming a joint venture

with the land owners or get the land funded by various Non-

Banking Financial Companies (NBFC) in the country, which is

quite an expensive route.

The entire process of availing home loans should be

simplified. The present Government under the leadership of

Prime Minister Modi is not just capable, but is well-equipped

to achieve its vision of providing housing to all by 2022.


ifimbschool.com

64

FINANCIAL INCLUSION

Financial inclusion has become a reality for 1.3 billion

Indians. We have generated more than 1.2 billion

biometric identities — called Aadhaar or foundation

— in just a few years. With our Jan DhanYojana,

we aimed to give a bank account to every Indian. Less than

50 per cent of Indians had bank accounts in 2014; now, it is

nearly universal”, said Prime Minister Narendra Modi at the

Singapore FinTech Festival in November 2018.

A high priority on the NDA government’s agenda, Modi

unveiled the Pradhan Mantri Jan Dhan Yojana (PMJDY), on

August 15, 2014, soon after winning the majority mandate.

A flagship initiative that aims to bring huge sections of the

previously unbanked population under the ambit of the

mainstream credit system, the PMJDY is a masterstroke

that hinges on a stack ecosystem for benefits at the multiple

levels, across a multitude of stakeholders. Primarily though,

the initiative is aimed at an enabling broad-based economic

development.

But what exactly is the scope of financial inclusion? It is

relevant in the context of Financial Inclusion (FI), to quote

“



the International Labour Organization (ILO) Declaration of

Philadelphia (1944), which states, “Poverty anywhere is a

threat to prosperity everywhere.”

In India, the Financial Inclusion Advisory Committee (FIAC)

set up in 2012 was reconstituted in June 2015 to review FI

policies on an ongoing basis and to provide expert advice to

accelerate FI. FIAC has the mandate to formulate National

Strategy for Financial Inclusion (NSFI). With the obvious

thrust on digital FI, and in line with the international best

practices, NSFI also seeks to draw upon the G-20 High-

Level Principles for Digital Financial Inclusion, adapted to

meet India-specific requirements. India has taken massive

strides towards financial inclusion in the last few years.

India’s first FI index launched in 2013 had four critical

dimensions: (i) branch penetration (ii) deposit penetration

(iii) credit penetration and (iv) insurance penetration. The FI

index is based on data provided by RBI, the Micro Finance

Institutions Network (MFIN), and the Insurance Information

Bureau of India.

Global institutions such as World Bank started measuring

once in three years, beginning 2011, the progress of FI

across countries through Global Findex. India’s GFX stood

35 in 2011, 53 in 2014, and 80 in 2017.

Global Findex Database of the World Bank in 2011 stated

that 40% of adult Indians had a bank account. Seven years

later, according to the Global Findex Database of April

2018, almost 80% of adult Indians have bank accounts.

The significant improvement in FI, reflects on the effective

implementation of the relevant Indian policies in the last few

years.

Powering this supersonic rise in FI, has been a series

of financial inclusion measures launched and effectively


ifimbschool.com

65

monitored by the government. These include Aadhar,

a biometric database that provides a unique identity

to each Indian citizen; no-frills savings bank accounts

called Jan Dhan accounts (under Pradhan Mantri Jan

Dhan Yojana: PMJDY); the direct benefit transfer (DBT)

of social benefit payments into these BSBDA accounts;

and a digital payment infrastructure named Bharat

Interface for Money (BHIM).

Today about 90% of India’s 1.3 billion population have

a unique Aadhar identity, which is vital for meeting

anti-money laundering “know your customer” (KYC)

requirements. In the last four years, 330 million new Jan

Dhan accounts have been opened. On the digital front,

the use of digital payments has been rising significantly

as the mobile penetration is expected to reach 90% by

2020 and the internet penetration has been soaring.

The banking infrastructure comprising of bank branches,

ATMs, digital kiosks, customer service points (CSP),

business correspondents (BCs), point of sale (PoS)

terminals and mobile ATM vans currently cover 5,69,547

villages out of the total of close to 6,60,000 villages. Of

these 5,15,317 villages (90.47 per cent) are covered by

BCs offering limited banking services.

With the growing empirical evidence on the potential

development benefits from financial inclusion, the

Reserve Bank of India’s (RBI) agenda has broadened

from the initial focus on provision of credit and making

available savings avenues to a larger remit of diverse

services including transactions, payments and

insurance, while continuing to wean away the financially

disadvantaged sections of the society from informal

sources of funds and the associated coercive practices.

Business Correspondents’ Registry Portal: The role of

business correspondents (BCs) in expanding the reach

of banking services in rural areas is gaining acceptance

and recognition, which is evident from the significant

increase in the number of transactions put through by

BCs through the information and computer technology

(ICT) channel. A registry portal developed by the IBA

on the basis of the framework provided by the Reserve


ifimbschool.com

66

Bank was launched in February 2018 to enable banks to

upload data pertaining to BCs employed by them

Progress of Banking Outlets in Rural locations

Furthermore, the branch authorisation policy recognises

BCs, which provide banking services for a minimum of four

hours per day and for at least five days a week as banking

outlets. This propelled a sizable increase in the number of

accounts opened through BCs who are also generating

robust growth in ICT-based banking services. (Source: FIP

returns submitted by banks, Report on Trend and Progress

of Banking in India 2017-18)

Kisan Credit Cards (KCC) & General Credit Cards (GCC):

The policy thrust on financial inclusion expanded access

to credit from institutional sources in rural areas to 69.1

per cent during 2015-16 (NAFIS 2016-17) as against 56

per cent in 2013 (All India Debt and Investment Survey).

Within non-institutional sources, a significant decline in the

dominance of moneylenders is evident. According to NAFIS

2016-17, agricultural households (74.5 per cent) relied much

more than non-agricultural households (63.8 per cent) on

institutional sources for their credit needs.

Progress of issuance of Kisan Credit Cards (KCC) &

General Credit Cards (GCC )

(Source: FIP returns submitted by banks, Report on Trend

and Progress of Banking in India 2017-18)

Microfinance Programme: Launched by the National Bank

for Agriculture and Rural Development (NABARD), the self-

help group (SHG)-Bank linkage programme involves micro-

credit extended collectively to small groups to undertake

productive activities with a view to integrating them into the

formal financial system. It has emerged as a key intervention

for poverty alleviation through financial inclusion. During

2017-18, 2.3 million new SHGs were credit-linked with

banks, and loans of `472 billion (including repeat loans) were

disbursed to these SHGs. On an average, the amount of

savings per SHG and the amount of credit per SHG were

`22,405 and `208,683, respectively.

Progress of Microfinance Programmes

(Source: NABARD)

During the year 2017-18, the amount disbursed through

micro finance institutions (MFIs) rose faster than under

the SHG-Bank linkage programme. The constant efforts

in counselling and guiding to bring about a mindset and

cultural shift among newly connected beneficiaries to derive

benefits from the formal financial system by borrowing from

banks and repaying loans in time. This will boost micro and

small enterprises, and hence alleviate poverty and raise the

standard of living of the community at the grass-roots level.

The two futuristic important aspects are, firstly the financial

literacy has to be driven up and secondly, the private sector

March 2010Banking Outlets in Rural locationBranches: 33378 Branchless mode: 34316(i.e. BCs)

March 2018Banking Outlets in Rural locationBranches: 50806Branchless mode: 518742(i.e. BCs)

2014-15

Loans disbursed by Banks to

Self Help Groups : 1.6 million (Rs 276 billion)

Micro Finance Institutions : 597 million (Rs 147 billion)

2017-18

Loans disbursed by Banks to

Self Help Groups : 2.3 million (Rs 472 billion)

Micro Finance Institutions : 1,922 million (Rs 255 billion)

March 2010

Kisan Credit Cards: 24 million

General Credit Card:1 million

March 2018

Kisan Credit Cards: 46 million

General Credit Card:12 million


ifimbschool.com

67

participation in rural and semi-urban areas has to significantly

go up, for ensuring a sustainable financial inclusion model.

Financial literacy: According to a Standard and Poor’s

survey, basic financial literacy in India is sub-par. India still

needs to do a great deal of work. Driven by the government

and regulators such as the Reserve Bank of India, as well

as voluntary efforts by companies through corporate social

responsibility (CSR) programmes, this is changing quite

rapidly.

The industry body Association of Mutual Funds of India has

been running a successful campaign to raise awareness

about the benefits of investing in mutual funds to create

long-term wealth. The last decade’s growth rate of

investment in mutual funds in India is now double that of the

rest of the world. Interestingly, digital flows into mutual funds

have increased 12 times in the last two years.

The private sector closer integration with the community

will help in bringing about a greater appreciation of the

challenges faced by financially excluded populace i.e. life

being often unpredictable and dependent on variables

such as weather and uncertain agri-commodity prices in

rural & semi-urban areas. Financial services firms need to

come forward innovatively to weave in these uncertainties in

their business models in order to serve these communities

successfully.

The government and providers of various financial products

partner closely, so the risks and rewards of working with

marginal populations are shared. For instance, rural housing

segment is powered by a government programme that

provides financial support and participation from the private

sector.

The way to address issues of rural India is by providing

rural communities with additional and alternative income

streams through greater financial inclusion. Microcredit has

the potential to transform the financially weak into micro-

entrepreneurs, as well as create jobs in the local community.

India has the world’s largest share of young people with

the half of the country population below the age of 25, which

have their soaring ambitions. Financial inclusion will therefore

continue to be the critical economic strategy platform to

alleviate poverty and address the people aspirations.


ifimbschool.com

68

Creating Holistic Policy Environment to Boost

Agriculture

“This is the strength of the farmers of our country

that the production of pulses has increased from

almost 17 million tonnes to 23 million tonnes

in just one year”, said the Prime Minister at the

National Conference on Agriculture 2022, in February 2018.

The government has taken a series of coordinated measures

to improve farmers’ income, reduce wastage and create

alternate sources of income.

Especially, the “Beej se Bazaar Tak” policy interventions of

government have been designed to address constraints

of farmers at every step. The various initiatives of the

government are expected to directly address factors

responsible for low productivity.

Strengthening the Nations Backbone



Developing adequate agri-infrastructure: Large investments

in warehouses and cold storages would prevent post-

harvest crop losses. The government is promoting value-

addition through food processing. Allied activities like

fisheries, poultry, beekeeping etc. have got a thrust. A

corpus of Rs. 10,000 crore was created for infrastructure.

The agri-market infrastructure fund of Rs. 2,000 crore was

set up and Rs. 1,290 crore was allocated under the National

Bamboo Mission to set up small industries.

Provision of adequate irrigation facilities: Under “Pradhan

Mantri Krishi Sinchayee Yojana” (PMKSY) for an outlay of Rs.

50,000 crore for five years (2015-16 to 2019-20), is aimed

at “Har Khet Ko Paani”. There is a special focus on irrigation

aimed at “per drop, more crop”, with the scheme envisaging

a coverage of 2.85 million hectares under irrigation and

2.69 million hectares under micro-irrigation. A dedicated

micro-irrigation fund of Rs. 5,000 crore has been assigned

to facilitate farmers to install solar water pumps in field

irrigation. The states will draw their irrigation development

plans under PMKSY, based on district/blocks plans with a

horizon of five to seven years. This is essential to remove

the dependence of marginal & small farmers on vagaries of

monsoons.

encouraging scientific farming: Providing of soil health cards

to the farmers along with quality seed and neem-coated urea

will improve farmers productivity as also the soil health.


ifimbschool.com

69

Credit availability to go up: Insufficiency of credit from

formal financial institutions and dependency of landless and

marginal farmers on money lenders, have adverse effect on

farmers productivity. The farm credit target for 2018-19 was

raised to INR 11 lakh crore.

Total agriculture credit disbursement (Rs. crore)

Source: National Bank for Agriculture and Rural Development

(NABARD)

Kisan Credit Card (KCC) scheme has since been simplified

with the ATM-enabled RuPay debit card with one-time

documentation and built-in cost escalation etc. As of March

2018, about 69.2 million KCCs were issued. The interest

subvention scheme (2%) for short-term crop loans up to

Rs. 3 lakhs earlier available for a period of one year, was

extended by six months to marginal and small farmers

against warehouse receipts to discourage distress sale.

Enabling adequate marketing facilities: Non-availability of

remunerative marketing avenues impact farmer incomes

as they rely upon middlemen. Under the scheme for

“Promotion of National Agriculture Market through Agri-

Tech Infrastructure Fund (ATIF)”, it had a budgetary outlay

of Rs. 200 crore (2015-16 to 2017-18) wherein a common

e-market platform was deployed in 585 regulated wholesale

markets.

This included one-time fixed cost up to a ceiling of Rs. 30

lakhs per ‘mandi’ for hardware, equipment/infrastructure

besides expenses on software and its customization for the

states.

Under e-NAM, over 8.75 million farmers and sellers are

registered and 16.45 million tonnes of farm commodities

have been transacted so far. E-NAM can be a game-

changer.

Remunerative prices: The government announced in July

2018 a big increase in the minimum support prices (MSP) for

14 crops, an increase in the scope of the program that the

agriculture ministry calls a “paradigm shift”. In October 2018,

the government came with increased MSP for Rabi crops for

2018-19 season.

2015-16 Rs 9,15,510 Cr

2016-17 Rs 10,65,756 Cr

2017-18 Rs 11,68,503 Cr


ifimbschool.com

70

The information on MSP from the years 2010-11 onwards is

as per Annexure.

Pradhan Mantri Fasal Bima Yojana (PMFBY): The premium

paid by farmers is very low and balance would be borne by

the government to provide fully-insured amount to farmers

against crop loss due to natural calamities. The farmers have

to pay a uniform premium of 2% for all Kharif crops, 1.5%

for all Rabi crops and 5% for commercial and horticulture

crops. The government action of removing the earlier cap on

government subsidy is a welcome decision and is in line with

the “One Nation-One Scheme”.

Aggregation of facilities for uneconomical land holdings: Due

to the rise in population, division of land take place, which

severely affects farm productivity. Aggregating farmers into

Farmer Producers Organization (FPO)/Farmer Interest Group

(FIG) and promoting their tie-ups with Market Aggregators

(MAs) and financial institutions (FIs) are among the several

initiatives under the Mission for Integrated Development of

Horticulture (MIDH), a centrally-sponsored scheme.

Distress Relief: The erstwhile cut-off point for relief to the

farmers was 50% and more damages to the crops, which

the present government made farmers friendly by reducing

it to 33% or more. The farmers get the full minimum support

price for foodgrains damaged by rains.

The government has revised upward the assistance to the

family of the deceased, in case of an eventuality, from the

earlier INR 2.5 lakhs to INR 4 lakhs. Further, there is a rise of

82% in the provisions under the State Disaster Relief Fund

(SDRF) to INR 61,220 crore (2015-2020) from an earlier

allocation of INR 33,581 crore (2010-2015).

The unique aspects of government actions have been the

systematic approach in initiating measures for providing

access to good quality seeds, greater access and availability

of fertilizers, irrigation and the right price for produce.

Through information and communication technologies, the

relevant information and services to farmers have been

provided on Farmers’ Portal. This is an endeavor to create a

one-stop shop for meeting all information needs relating to

agriculture, animal husbandry, fisheries sectors, production

and sale/storage of farmer.

The farm inputs related information with state-wise dealers

are available to facilitate the farmers. Also, the information

on seed varieties, soil testing laboratories, Integrated Pest

*Includes all paid out costs such as those incurred including miscellaneous expenses and imputed value of family labor

Source: Press Information Bureau, Ministry of Agriculture & Farmers Welfare


ifimbschool.com

71

Management Plan (IPMP), video clips for farm machinery etc

are made available on the portal.

Post-harvest support includes information on storage,

MSP and market prices. Risk Management-related support

exits as guidance for drought management, soil fertility

maps, contingency plans, hailstorms, NADAMS (National

Agricultural Drought Assessment and Monitoring System)

and PMFBY are provided on the portal.

Once on the portal, a farmer would be able to get all

information on specific subjects around his village/block/

district or state. This information would be delivered as text,

SMS, email and audio/video in the language he understands.

They can be reached through the map on the homepage.

Farmers will also be able to ask specific queries and give

feedback through the Feedback Module specially developed

for the purpose.

The enablers include government (central, state, and local),

academia, universities, research institutions, technology

providers, regulatory authorities, financial institutions,

corporates, market makers, peoples’ institutions, opinion

makers, and above all, the farmers themselves. The

collective efforts of all stakeholders will help in creating the

enabling environment for successful implementation and

execution of policies and plans, in letter and spirit.

The objective to create a vibrant enabling environment is

to enhance the farm household incomes optimally through

concerted efforts, the inter-sectoral complementarities and

convergence opportunities, and this has to be ensured

through synergy amongst the various stakeholders.

Achieving the objective of doubling farmers’ income by 2022

would require acceleration in all key strategic initiatives.

NITI Aayog (2017) has suggested acceleration in sources

underlying growth in output by 33%.

The enhancement of farmers’ income will have a far-reaching

impact on Indian farmers for the improvement in their per

capita income, alleviation of farmers’ distress, upgrading of

their lifestyle, and reducing income disparities between farm

and non-farm sectors.

The Centre, States, Union Territories and all other

stakeholders have to work optimally in coordination with

each other and stretch their efforts to achieve this much-

desired goal.

The unique aspects of government actions have been the

systematic approach in initiating holistic measures aimed at

giving a thrust to agriculture sector. The doubling of farmers’

income by 2022 is challenging, though attainable through

coordinated and committed efforts of all stakeholders.


ifimbschool.com

72

Through Policies, Schemes For Minorities

and Special GroupsEnsuring An Inclusive India

When our government passed the triple talaq

bill in Lok Sabha, attempts were made to

stall it in the Rajya Sabha. But we were

bound by our commitment to freeing our

Muslim sisters and daughters from this evil practice. We

have made the practice illegal by bringing in an ordinance. It

will be our constant endeavour to get the parliament’s seal of

approval on this at the earliest,” said Prime Minister Narendra

Modi during a public rally in Talcher, Odisha.

On February 21, 2019, the Triple Talaq Bill was re-

promulgated. According to reports from the Law Ministry,

President Ram Nath Kovind, signed the Muslim Women

(Protection Rights on Marriage) Second Ordinance, 2019.

Despite the continuous push by the Government to protect

the rights of Muslim women in the country, its efforts are

falling flat owing to differences of opinion in the Parliament.

The Scheduled Castes (SCs or Dalits are 16% of the

population) and Scheduled Tribes (STs, also called Adivasis,

make up 8%) are at the bottom under the system.

They have been given a special status in the Constitution to

mainstream them. Meanwhile, Muslims, the largest minority,

are on an average worse off than the general population.

Other minority communities do not suffer as much.

India’s indigenous forest-dwellers, Adivasis, too are victims of

the British Raj. But, Adivasis are not a single community.

Minorities’ issues have taken centre-stage in the political

discourse, be it separatist movements, demands for political

representation, or the need to protect their religions and

cultures. Meanwhile, the challenge is to enable minorities’

problems to be discussed.

The National Minorities Development & Finance Corporation

(NMDFC) was incorporated on 30th September, 1994, to

promote economic activities amongst the backward sections

of the notified minorities through concessional finance.

India has formulated the ‘Prime Minister’s New 15-Point

Programme for the Welfare of Minorities’. The programme

aims at ensuring a fair percentage of the priority sector

lending to minority communities. The programme is

implemented by the Centre in the States / Pradhan Mantri

“


ifimbschool.com

73

Jan Vikas Karyakram (PMJVK) seeks to support the minority

communities in education, health, skill development etc. to

bridge differences.

Multi-sectoral Development Programme (MsDP) is a special

area development scheme to address the development

deficits in districts with concentration of minority

communities.

The Ministry of Minority Affairs through the National

Minorities Development & Finance Corporation (NMDFC) is

implementing “Artisan Credit Scheme for Minorities”.

The government has taken up initiatives for the welfare and

upliftment of minorities:-

●● USTAAD: The Scheme aims to upgrade Skills and

Train to preserve traditional Ancestral Arts/Crafts of

minorities.

●● Hamari Darohar: The Scheme aims to preserve the

heritage of minority communities in context of Indian

culture.

●● Khwaza Garib Nawaz Senior Secondary School will

be established at Ajmer by Maulana Azad Education

Foundation (MAeF) to give a fillip to minority education.

●● Nai Manzil: A bridge course to bridge the academic

and skill development gaps of the Madrasa passouts

with their mainstream counterparts.

●● Strengthening State Wakf Boards: The scheme aims

to meet training and administrative costs of State

Wakf Boards, and removalencroachment of

properties.

The Nai Roshni scheme by the Government of India aims

to reach women through NGOs to finance leadership

development training to help them leave their homes and

assume leadership roles.

Under the Learn & Earn Policy, the Union Ministry of

Minority Affairs, Government of India, on 23rd September,

2013, launched a central scheme for Skill Development of

Minorities. The main objectives of the scheme are:

●● To cut unemployment among minorities during the

12th Plan period (2012-17).

●● To conserve and update traditional skills and link

them with the market.

●● To improve employability of workers, school dropouts

and ensure their placement.

●● To generate means of better livelihoods for

marginalised minorities.

●● To enable minorities to avail opportunities in the

market.

●● To develop potential human resource for the country.

The Centre has introduced an ‘interest subsidy’ for minority

students for overseas studies. This came into force during

2013-14 for courses sanctioned by the bank under IBA

model scheme..

If the student is eligible, the Centre extends full interest

subsidy during the moratorium. (course period plus one year

or six months after getting employment, whichever is earlier).

Meanwhile, the Nalanda Scheme Centre, has launched the

Nalanda Project for Minorities Higher Educational Institutions

on 4 March, 2014. Nalanda Project is a Faculty Development

Program. The project is being taken up at Aligarh Muslim

University (AMU).

The Constitution protects the interests of the minorities and

recognises their rights to conserve their languages, scripts or

culture, and establish and administer educational institutions

of their choice. While the Constitutional discourse is flawless,

the government and the pillars of Indian democracy are

leaving no stones unturned to ensure that a focused

approach towards the issues of notified minorities.


ifimbschool.com

74

Digital India: Building A Digital Infrastructure

for IndiaFoundation for a future ready India

I see technology as a means to empower and as a

tool that bridges the distance between hope and

opportunity. Social media is reducing social barriers. It

connects people on the strength of human values, not

identities”, said Prime Minister Narendra Modi, during his trip

to Silicon Valley, a couple of months after the launch of Digital

India. The government’s marquee initiative to leverage the

digital infrastructure for inclusive development, Digital India

forms the level playing field between India and Bharat.

Digital India was launched by the Prime Minister of India

Narendra Modi on 1st July 2015, with an objective of

connecting rural areas with high-speed Internet network and

improving digital literacy under Ministry of Electronics and

Information Technology. The Digital India programme is a

“

Pritam ghosh

ASSISTANT PROFESSOR OF LAW, IFIM LAW SCHOOL

flagship programme of the government of India with a vision

to transform India into a digitally empowered society and

knowledge economy.

Ravi Shankar Prasad, the Minister for IT, said post the

launch of the initiative, “Digital India is more for the poor and

underprivileged. It aims to bridge the gap between the digital

haves and have-nots by using technology for citizen.” These

words succinctly sum up the pivotal role that the initiative

heralds for the masses from the Himalayas to the hinterland.

The following are the approach and Methodology for Digital

India Programme:

i. Ministries / Departments / States would fully leverage

the Common and Support ICT Infrastructure

established by GoI. DeitY would also evolve/ lay

down

standards and policy guidelines, provide technical

and handholding support, undertake capacity

building, R&D, etc.

ii. The existing/ ongoing e-Governance initiatives

would be suitably revamped to align them with the

principles of Digital India. Scope enhancement,

Process Reengineering, use of integrated &

interoperable systems and deployment of emerging

technologies like cloud & mobile would be

undertaken


ifimbschool.com

75

to enhance the delivery of Government services to

citizens.

iii. States would be given flexibility to identify for inclusion

additional state-specific projects, which are relevant

for their socio-economic needs.

iiii. e-Governance would be promoted through a

centralised initiative to the extent necessary, to

ensure citizen centric service orientation,

interoperability of various e-Governance applications

and optimal utilisation of ICT infrastructure/ resources,

while adopting a decentralised implementation model.

v. Successes would be identified and their replication

promoted proactively with the required productization

and customisation wherever needed.

vi. Public Private Partnerships would be preferred

wherever feasible to implement e-Governance

projects with adequate management and strategic

control.

vii. Adoption of Unique ID would be promoted to facilitate

identification, authentication and delivery of

benefits.

viii. Restructuring of NIC would be undertaken to

strengthen the IT support to all government

departments at Centre and State levels.

ix. The positions of Chief Information Officers (CIO)

would be created in at least 10 key Ministries so

that various e-Governance projects could be

designed, developed and implemented faster. CIO

positions will be at Additional Secretary/Joint

Secretary level with over-riding powers on IT in the

respective Ministry.

India comprises of 15 per cent of the world population,

and with a growth rate of 7 to 8 per cent, the country can

very well become the second largest economy by 2030. To

achieve this, the government considers the digital economy

as the primary growth enabler.

By implementing digital payment methods, like Digital Point

of Sale (Digital POS), Unified Payments Interface (UPI),

mobile wallets, Mobile Point of Sale (mPOS), etc., India is

moving towards creating a digital economy that will benefit

the people and the government in various ways. Some of


ifimbschool.com

76

the primary advantages that government witnesses from the

digital economy are:

1. Removal of Black Economy: When the transactions

are made digitally, they can be easily monitored.

Any payment made by any customer to any

merchant will be recorded. This way, there will be no

means for illegal transactions to occur. By restricting

the cash-based transactions and using only digital

payments, the government can efficiently expel the

black economy.

2. Increase in Revenues: This is one of the most

obvious and common benefits of the digital

economy. When the transactions are digitized,

monitoring sales and taxes becomes convenient.

Since each transaction is recorded, the customers

will get a bill for their purchase, and the merchants

are bound to pay the sales tax to the government.

This, in turn, increases the revenue of the government

– thus resulting in growth of the overall financial

status of the country.

3. Empowerment to People: One of the biggest

advantages of moving towards digital economy

is that it gives an empowerment to the citizens.

When the payments move digital, each and every

individual is bound to have a bank account, a mobile

phone, etc. This way, the government can easily

transfer the subsidies directly to Aadhaar-linked

bank accounts of people. In short, people no longer

have to wait to receive the incentives and subsidies

that they are bound to receive from the government.

This feature is already in place in most cities.

One example of that would be the LPG subsidy that

government gives to the common people. This

subsidy payment is done via bank transfers these

days.

4. Paves the way to e-governance: The quicker,

safer, and more efficient alternative to traditional

governance, e-governance will be the ultimate

outcome of the digital economy. From birth certificate

to death certificate, everything is available online –

thus it is convenient for people to access the

information they need on the go. Digital economy will

definitely pave a way to e-governance, where delivery

of all government services would be done

electronically.

5. Creation of new jobs: The digital economy has a

lot of potential to enhance job opportunities in new

markets as well as increasing employment

opportunities in some of the existing occupations in

the government. This way, the unemployment rate in

the country is bound to decrease.

As Abraham Lincoln, the 16th President of the USA,

famously said, “Government of the people, by the people,

for the people, shall not perish from the earth.” Whatever the

government benefits from digital economy, directly have a

positive impact on every citizen’s life.

However, the let-down here is that according to the World

Bank, “nearly a billion Indians are still not able to tap the

benefits of a digital economy.” To move towards a digital

India and achieve a better growing economy, every single

citizen must use digital payments even for their petty

expenditures.

The journey of e-Governance initiatives in India took a

broader dimension in mid 90s for wider sectoral applications

with emphasis on citizen-centric services. Later on, many

“E-Governance is an essential part of our dream of

DIGITAL INDIA, the more technology we infuse in

Governance, the better it is for INDIA.”

-Shri Narendra Modi


ifimbschool.com

77

States/UTs started various e-Governance projects. Though

these e-Governance projects were citizen-centric, they could

make lesser than the desired impact.

The Government launched National e-Governance Plan

(NeGP) in 2006. As a part of the initiative, 31 Mission Mode

Projects covering various domains were initiated. Despite the

successful implementation of many e-Governance projects

across the country, e-Governance as a whole has not been

able to make the desired impact and fulfil all its objectives.

It has been felt that a lot more thrust is required to ensure

e-Governance in the country promote inclusive growth

that covers electronic services, products, devices and job

opportunities. Moreover, electronic manufacturing in the

country needs to be strengthened.

In order to transform the entire ecosystem of public services

through the use of information technology, the Government

of India has launched the Digital India programme with the

vision to transform India into a digitally empowered society

and knowledge economy.

The Vision of digital India is to transform the country into

dignity empowered society and knowledge economy.

It would ensure that government services are available

to citizen electronically. It would also bring in public

accountability through mandated delivery of government’s

services electronically.

Infrastructure as a utility to every citizen:

High speed internet shall be made available in all gram

panchayats; Cradle to grave digital identity; Mobile and

Bank account would enable participation in digital and

financial space at individual level; easy access to common

service centre within their locality; Shareable private space

on a public cloud; and Safe and secure cyber space in the

country.

Governance and Services on Demand:

Single window access to all persons by seamlessly

integrating departments or jurisdictions; availability of

government services in online and mobile platforms;

All citizen entitlements to be available on the Cloud to

ensure easy access; Government services to be digitally

transformed for improving ease of doing business; Making

financial transactions above a threshold, electronic and

cashless; and Leveraging GIS for decision support systems

and development.


ifimbschool.com

78

Digital empowerment of citizens:

Universal digital literacy; All digital resources universally

accessible; All government documents/certificates to be

available on the Cloud; Availability of digital resources/

services in Indian languages; Collaborative digital platforms

for participative governance; Portability of all entitlements for

individuals through the cloud.

Accessible India Campaign Mobile App: Sugamya

Bharat Abhiyaan or Accessible India Campaign is a nation-

wide flagship campaign for achieving universal accessibility

that enables people with disabilities to gain access for equal

opportunity, live independently and participate fully in all

aspects of life in an inclusive society. The campaign targets

at enhancing the accessibility of built environment, transport

system and Information and communication ecosystem.

The mobile application is a crowd sourcing platform to

comprehensively obtain information on inaccessible places

across the country. The mobile application is available on

IOS, Android and Windows platform and can be downloaded

from the respective App Stores.

Agrimarket App: The mobile application has been

developed with an aim to keep farmers abreast with the

crop prices and discourage them to carry-out distress sale.

Farmers can get information related to prices of crops in

markets within 50km of their own device location using the

AgriMarket Mobile App. This app automatically captures the

location of the farmers using mobile GPS and fetches the

market prices of crops which fall within the range of 50km.

The prices of agriculture commodities are sourced from the

Agmarknet portal. Currently, the apps is available in English

and Hindi languages.

Centre for Excellence for Internet Of Things (COE-IT):

The Centre of Excellence for IoT was announced as a part

of the Digital India Initiative to jump start the IOT ecosystem

taking advantage of India’s IT strengths and help the country

attain a leadership role in the convergent area of hardware

and software. The main objective of the center is to create

innovative applications and domain capability. Additionally,

the center will help build industry capable talent, start-up

community and an entrepreneurial ecosystem for IOT.

Crime and Criminal Tracking Network & Systems

(CCTNS): Crime and Criminal Tracking Network &

Systems (CCTNS) is a plan scheme conceived in the light

of experience of a non-plan scheme namely - Common

Integrated Police Application (CIPA). CCTNS aims at creating

a comprehensive and integrated system for enhancing the

efficiency and effectiveness of policing through adopting

of principle of e-Governance and creation of a nationwide

networking infrastructure for evolution of IT-enabled-state-

of-the-art tracking system around ‘Investigation of crime and

detection of criminals’.

Cyber Swachhta Kendra: Cyber Swachhta Kendra

(Botnet Cleaning and Malware Analysis Centre) is a part of

the Government of India’s Digital India initiative to create

a secure cyber space by detecting botnet infections in

India and to notify, enable cleaning and securing systems

of end users so as to prevent further infections. It is set

up in accordance with the objectives of the ‘National


ifimbschool.com

79

Cyber Security Policy’, which envisages creating a secure

cyber eco system in the country. This centre operates in

close coordination and collaboration with Internet Service

Providers and Product/Antivirus companies.

Digilocker: DigiLocker is the Indian Government’s flagship

program aimed at transforming India into a digitally

empowered society and knowledge economy. DigiLocker

ties into Digital India’s visions areas of providing citizens a

shareable private space on a public cloud and making all

documents/certificates available on this cloud. Targeted at

the idea of paperless governance, DigiLocker is a platform

for issuance and verification of documents & certificates in a

digital way, thus eliminating the use of physical documents.

E-hospital: e-Hospital@NIC (link sends e-mail) is an open

source health information management system (HMIS) which

is configurable and easily customizable with multi-tenancy

support. It is designed to deploy in cloud infrastructure

to manage multiple hospitals seamlessly. The generic

application addresses all major functional areas of a hospital.

A workflow based HL7 compliant and ISO/IeC 9126 certified

end-to-end solution Software for hospital management

which covers complete treatment cycle of OPD/IPD as well

integrates clinical, administrative, and billing/ insurance

activities.

E-VISA: The Ministry of Tourism supported the initiative

regarding the implementation of Tourist Visa on Arrival

enabled with Electronic Travel Authorisation (ETA) (renamed

as e-Tourist Visa) strongly and committed all support to

Ministry of Home Affairs and Ministry of External Affairs and

Ministry of Civil Aviation for implementing this programme.

The e-Tourist Visa enables the prospective visitor to apply

for an Indian Visa from his/her home country online without

visiting the Indian Mission and also pay the visa fee online.

MyGov: MyGov platform is a unique path breaking initiative

which was launched by the Hon’ble Prime Minister of

India, Shri Narendra Modi. It is a unique first-of-its-kind

participatory governance initiative involving the common

citizen at large. The idea of MyGov brings the government

closer to the common man by the use of online platform

creating an interface for healthy exchange of ideas and views

involving the common citizen and experts with the ultimate

goal to contribute to the social and economic transformation

of India.

National Voters Service Portal (NVSP): The portal was

developed with an aim to provide single window service

electors. Through NVSP, a user can avail and access various

services such as access the electoral list, apply for voter id

card, apply online for corrections in voter’s card, view details

of Polling booth, Assembly Constituency and Parliamentary

constituency, and get the contact details of Booth Level

officer, electoral Registration Officer, among other services.

Nirbhaya App: Be Fearless is an android emergency

application, which can send a distress call or emergency

message to a specified contact or group in an emergency

situation faced by a woman or any other individual in general.

Correct Location, Information and Communication, with

and from the app is dependent upon the basic hardware/

software requirements, like - Active Data plan, SMS plan,

minimum talk time and active GPS functionality.

Pradhan Mantri Kaushal Vikas Yojana (PMKVY):

Pradhan Mantri Kaushal Vikas Yojana (PMKVY) is the

flagship scheme of the Ministry of Skill Development

& Entrepreneurship (MSDE). The objective of this Skill

Certification Scheme is to enable a large number of Indian

youth to take up industry-relevant skill training that will

help them in securing a better livelihood. Individuals with

prior learning experience or skills will also be assessed and

certified under Recognition of Prior Learning (RPL).

While India faces legacy-driven roadblocks that are

hampering an accelerated development of physical

infrastructure, the country is a global leader in developing

state-of-the-art, digital infrastructure. A digitally connected

India can help in improving social and economic condition

of people living in rural areas through development of

non-agriculture economic activities apart from providing

access to education, health and financial services. A highly

responsive Digital India campaign, that delivers on promises

is the best way forward to build a future-ready India that can

leverage its skills and demographics to leap ahead of the rest

of the world.


ifimbschool.com

80

Ushering A New India Through Policies Focused

on Youth DevelopmentEnsuring the Demographic Dividend

Just imagine, today India is the youngest country

in the world. A nation with the oldest civilization

is also the youngest country in the world. What a

beautiful coincidence, what amazing amalgamation.

A nation whose 65% population is less than 35 years old,

a nation whose youth is incredibly tough, whose fingers

have the deftness to be connected with the world via

computers, a nation whose youth is determined to create

its own future, that nation now does not need to look

back”, said Prime Minister Narendra Modi from Madison

Square Garden, New York, on 28th September, 2014.What

could be a greater source of inspiration for the

youth of India than to witness the stupendous

rise of Narendra Modi, from a humble tea-seller

to becoming the Prime Minister of India, the

“

SATISH KUMAR

PROFESSOR, MARKETING IFIM BUSINESS SCHOOL

world’s most promising major economy? From

announcing the Skill India initiative, to placing

development of youth at the centre of the

government policy, the Prime Minister has been

instrumental in promoting the interests of the

youth and building a strong roadmap for their

excellence.

Not many governments post-independent India had made

a serious effort towards reforms that would focus only

on skill development. Today as the world is increasingly

moving towards skills-based roles and expertise, India’s

demographic dividend is yet to garner its full potential, as a

result of lack of adequate skills among the larger swathes of

the young population.

The issue of job creation in itself is a case in point. The

government had been accused of creating a jobless

economic growth during its tenure. However, official data

and the government’s razor-sharp focus towards youth and

entrepreneurship prove otherwise.

Citing Employees’ Provident Fund (EPF) and Employees’

State Insurance Corporation (ESIC) data, the Prime Minister

quoted on a public speaking forum, “Even if one assumes

there is 50 per cent overlap between EPFO and ESIC data,

1 million people joined the formal sector in a month. This

means 12 million jobs were created in the formal sector in a

year in these four years.”


ifimbschool.com

81

As the Prime Minister suggested, the formal sector has been

witnessing fairly robust year on year growth. If one takes

into consideration the creation of jobs, the incomes and the

impact on the economy, of the informal sector, the picture

is bound to be radically different. Unfortunately, hardly does

that data exist.

The government has already taken strides to address

these. During the Union Budget 2019, the Finance

Minister announced a nationwide pension scheme for the

unorganised sector. Eventually launched on March 6, 2019,

the Pradhan Mantri Shram Yogi Maandhan (PM-SYM),

promises an assured payment of Rs 3,000 per month, with a

contribution of Rs 100 per month, for workers in unorganised

sector after 60 years of age, offering them a security net for

their old age.

While an unprecedented initiative in itself, what the PM-

SYM does is that, it provides a concrete framework for

the amalgamation of the workers in the sector into the

mainstream formal economy, while at the same time

providing for a credible channel to provide statistical data on

the sector.

According to a communique by the government on the

National Mission for Skill Development, “India currently

faces acute shortage of well-trained, skilled workers. It is

estimated that only 2.3 % of the workforce in India has

undergone formal skill training as compared to 68% in the

UK, 75% in Germany, 52% in USA, 80% in Japan and 96%

in South Korea. Large sections of the educated workforce

have little or no job skills, making them largely unemployable.

Therefore, it is important for the Government of India to scale

up skill training efforts to meet the demands of employers

and drive economic growth.”

More than 54 per cent of the total population in India

is below 25 years of age, while over 62 per cent of the

population in the working age group (15-59 years). The

country’s population pyramid is expected to bulge across the

15-59 age group over the next decade.

This demographic advantage is predicted to last only until

2040. India therefore has limited time to take advantage

of its demographic advantage by providing proper skills to

this young population. India’s economy is currently growing

within a range of 6.1 percent to eight percent (in 2016-17

and in Q4 of 2017-18, respectively).

The country is expected to grow even faster with its

demographic dividend, high in investment and savings rates,

with the resource allocation for infrastructure. Investment in


ifimbschool.com

82

skills development will foster the economic and employment

growth.

The Skill India is a campaign launched by Prime Minister Sri

Narendra Modi on 15th July, 2015, is a marquee initiative

to train our young population for skills. The initiative aims to

train over 400 million people across the length and breadth

of the country in different skills by 2022.

It includes various initiatives of the government like ‘National

Skill Development Mission’, ‘National Policy for Skill

Development and Entrepreneurship, 2015’, ‘Pradhan Mantri

Kaushal Vikas Yojana (PMKVY)’ and the ‘Skill Loan scheme’.

The National Skill Development Mission was approved by the

Union Cabinet on 1st July 2015, and officially launched by

the Hon’ble Prime Minister Sri Narendra Modi on 15th July

2015 on the occasion of World Youth Skills Day. The Mission

has been developed to create convergence across sectors

and States in terms of skill training activities.

Further, to achieve the vision of ‘Skilled India’, the National

Skill Development Mission would not only consolidate

and coordinate skilling efforts, but also expedite decision

making across sectors to achieve skilling at scale with

speed and standards. It will be implemented through a

streamlined institutional mechanism driven by Ministry of Skill

Development and Entrepreneurship (MSDE).

Key institutional mechanisms for achieving the objectives

of the Mission have been divided into three tiers, which

consist of a Governing Council for policy guidance at apex

level, a Steering Committee and a Mission Directorate

(along with an Executive Committee) as the executive arm

of the Mission. Mission Directorate will be supported by

three other institutions: National Skill Development Agency

(NSDA), National Skill Development Corporation (NSDC),

and Directorate General of Training (DGT) – all of which will

have horizontal linkages with Mission Directorate to facilitate

smooth functioning of the national institutional mechanism.

Seven sub-missions proposed to act as building blocks for

achieving overall objectives of the Mission are:

(i) Institutional Training (ii) Infrastructure (iii) Convergence (iv)

Trainers (v) Overseas Employment (vi) Sustainable Livelihoods

(vii) Leveraging Public Infrastructure

The National Skill Development Corporation India (NSDC)

was setup as a one of its kind, Public Private Partnership

Company with the primary mandate of catalysing the skills

landscape in India. It is based on the following pillars:

●● Create large and good quality vocational

institute.

●● Reduce risk by providing patient capital.

Including grants and equity.

●● To enable the creation and sustainability

of support systems required for skill

development. This includes the Industry

led Sector Skill Councils.

Pradhan Mantri Kaushal Vikas Yojana (PMKVY) is the

flagship scheme of the Ministry of Skill Development &

Entrepreneurship. The objective is to enable

a large number of Indian youths to take up

industry-relevant skill training that helps them in

attaining better livelihood.

Individuals with prior learning experience or

skills will also be assessed and certified under

Recognition of Prior Learning (RPL). Under this

Scheme, Training and Assessment fees are

completely paid by the Government.

The objective of the National Policy on Skill

Development and Entrepreneurship, 2015


ifimbschool.com

83

will be to meet the challenge of skilling at scale with speed

and standard (quality). It will aim to provide an umbrella

framework to all skilling activities being carried out within the

country, to align them to common standards and link the

skilling with demand centres.

The Skill Loan Scheme has replaced earlier Indian Banks

Association (IBA) Model Loan Scheme for Vocational

Education and Training. The Indian Banks Association (IBA)

has already circulated the scheme to the Chief Executives

of All Member Banks for implementation of the Scheme.

Any Indian National who has secured admission in a course

run by Industrial Training Institutes (ITIs), Polytechnics or in

a school recognised by Central or State Education Boards

or in a college affiliated to recognised university, training

partners affiliated to National Skill Development Corporation

(NSDC) Sector Skill Councils, State Skill Mission, State Skill

Corporation can avail loan for the purpose.

The government has set up the Ministry of Skill Development

and Entrepreneurship (MSDE), to facilitate job creation and

entrepreneurship, as well as attract private investment. Steps

are also being taken to attract foreign direct investment and

enhance manufacturing growth.

The Pradhan Mantri Kaushal Vikas Yojana (Skill India Mission)

is MSDe’s flagship scheme to enable young Indians to

take up industry-relevant skills training and improve their

employability. The government’s commitment in imparting

skills training to young Indians thereby making them

competitive in the labour market. To achieve this, following

initiatives have been taken:

1. Deen Dayal Upadhyaya Grameen Kaushalya Yojana

2. Pradhan Mantri Kaushal Vikas Yojana

3. Financial Assistance for Skill Training of Persons with

Disabilities

4. National Apprenticeship Promotion Scheme

5. Craftsmen Training Scheme

6. Apprenticeship training

7. Pradhan Mantri Kaushal Kendra

8. Skill development for minorities

9. Green Skill Development Programme

Several national flagship schemes such as Make in India,

Start-up India, Stand-up India (a bank loan programme

to assist Scheduled Caste, Scheduled Tribe and women

borrowers to set up a greenfield enterprise), and digital India,

have been launched to spur the creation of more productive

and higher skilled micro, small and medium enterprises,

which would accelerate labour demand and job creation.

The Atal Innovation Mission endeavours to promote a culture

of innovation and entrepreneurship by providing a platform

for the generation and sharing of innovative ideas, alongside

an incubator to mentor and support innovators.

The United Nation’s priority group on skilling,

entrepreneurship and job creation partners with the

Government of India to provide labour market information

systems, extend support for school-to-work transition

strategies, as well as help improve the targeting, quality and

delivery of employment and skills training programmes at the

state level.

It supports the government’s initiatives on job creation and

entrepreneurship programmes to ensure that young people,

women, migrant workers and other marginalised groups are

included. Efforts are concentrated in low-income states and

districts and the North-East, and sectors including micro,

small and medium enterprise (MSME) development, rural

labour markets, labour intensive manufacturing, infrastructure

development and new sectors such as green industry and

affordable housing.

The group provided support to the Government of Mizoram

on a skill-gap assessment and the formulation of a skill

development and entrepreneurship policy. It also collaborates

with Ministry of Skill Development and Entrepreneurship

(MSDE) on promoting entrepreneurship and supported the

India consultation of the UN Secretary-General’s high-level

panel on women’s economic empowerment and its

follow ups.

Job Creation in 2017

The employment created in 2017, is assessed in two

separate age-groups—15-24 and 25-64. The two sources of

data are the recent provident fund (EPFO) data for the age-


ifimbschool.com

84

group 15-24, and the CMIE employment data for the 25-64

age group. The EPFO data refers to the net additions of

employees in the formal, provident fund payment sector. For

the six-month period September 2017-February 2018, total

net additions in the 18-21 age-group was 1.1 million; in the

22-25 group (college graduates?), net additions were lower

at 0.8 million. Even after allowing a reasonable amount of

job-hopping (20%), the EPFO data suggests that in 2017, 3

million jobs were added in the 15-24 age group. For the 25-

64 age group, the CMIE data shows that total employment

creation in 2017 was 12 million. Total job-creation in 2017

was 15 million.

In July 2016, the Indian government revamped the PMKVY.

In the second edition of the programme, the PMKVY (2016-

2020) placements went up from 17.3% of those certified

in the short -term training of the first programme to 46.5%,

government data show. Still, over half of those certified had

not got a job until at least three months after the certification,

according to data from the programme’s online dashboard.

A successful Skill India programme would benefit the

country–India is expected to have the largest workforce in

the world by 2025. By the same year, the world is expected

to face a shortage of 56.5 million skilled workers, while

India is projected to have a surplus of 47 million,

Indian government statistics show, as IndiaSpend reported in

July 2017.

Yet, 30% of India’s youth are neither employed nor in

education or training, Bloomberg reported on July 7, 2017.

Unless employed gainfully, India’s “demographic dividend”

could turn into a socio-economic nightmare.

Data suggests that out of the 1.45 million who were certified

through the PMKVY between July 2015 and July 2016,

252,223, or 17.3%, were placed in jobs.

From July 2016, the government started a new version of the

PMKVY. The second edition improved the first programme,

and made several changes including third party inspection,

added soft skill and entrepreneurship modules to the

trainings, and linked the programme to placements. By May

31, 2018, the PMKVY 2 had trained about 2.84 million (28.4

lakh) under three of its programmes–the Short Term Training

programme, Recognition of Prior Learning (RPL)–which

certifies people who are already skilled after a short training

and assessment, and special projects–such as trainings

for the disabled, training of the railway catering staff, digital

literacy for street vendors–according to data provided by the

ministry.

15 Million Jobs in 2017

It appears that 15 million jobs were created in 2017, not

much different than the Vajpayee average of five years.

Between 1999-2004, 11 million jobs were created each

year (weekly status definition of employment, closest to

the daily status CMIe definition; the usual status definition

gives an increase of more than 12 million a year). Between

2004 through 2011, the government could achieve an

employment gain of less than 4 million a year.

The interpretation of the data suggests that in economic

terms, the Modi period 2014-2018 has delivered the best

macro-economic performance ever in India—several

economic reforms, steady GDP growth, low inflation, and

robust job-creation.

Of the 960,000 who had been certified under the Short

Term Training programme by March 7, 2018, 46.5% had

been placed by May 30, 2018, according to data from the

PMKVY dashboard.

The placement numbers, though higher than the first

PMKVY, show that over half of those who completed the

short training and were certified were still without a job at

least three months after certification. The PMKVY 2016-2020

gives a timeframe of 90 days from date of certification to

place the candidates.

The number of placed candidates is higher if those certified

under RPL–who are likely to have been employed or self-

employed even before the training–are included. Sixty

percent of certified candidates of all three programmes

combined were placed within 90 days of their certification as

on June 5, 2018.


ifimbschool.com

85

Though the Narendra Modi led government is

aiming to skill 40 crore people by 2022 through

its ‘Skill India’ program, the lack of awareness

among youth about the government-run skill

development programs is one of the key obstacles with

about 70% of Indian youth is not aware of these schemes,

according to a recent study “Young India and Work” by the

Observer Research Foundation and World Economic Forum

(WEF).

Almost 6,000 youths between the age group of 15 and

30 were surveyed about education, employment and

their aspirations. The study throws lights on the potential

misalignment between youth and government, as well

as between youth and industry. It showed that there is a

disconnect between the government-run skill development

programmes and youth sentiments.

About three-fourths of the youth in the country has never

enrolled for a skill development program, the findings

showed. The low training participation was mainly on

account of financial and time issues. The findings showed

that 76% of the respondents were interested in pursuing

skills development training.

As identified by respondents in the survey, the characteristics

of attractive skills programmes include moderate time

commitment, monetary compensation, certification, and

a mix of online and classroom content. Youth consider

the public sector as ideal providers for skill development

opportunities, followed by public-private partnerships.

With more female respondents expressed

their interest in participating in skill

development programs, 19% of the

females have already enrolled in such

a program as compared with 26% of

males. While over three-fourths of all

females respondents were not aware of

any government-run skill development

program, a half of females indicated time

constraints that inhibited their program

enrolment.

According to the survey, nearly 51% of

the youth in the country perceive the lack

of professional guidance in identifying jobs that match their

skills to be the main obstacle in searching for a desirable

job. On the other side, nearly 34% of youth reported being

neither employed nor in education.

“In the context of technological adoption and digitisation,

jobs and tasks, along with the competencies required to

execute them, are changing. 86% of youth feel very or

moderately up to date with changes in skills requirements.

Yet, 39% of youth feel very prepared or prepared for their

ideal job, while 16% of youth feel either not prepared or very

unprepared for their ideal job,” it said.

While higher education degrees are highly valued, youth are

also eager to learn new skills. According to the survey, 96%

of the respondents hope to get a bachelor’s degree or higher

84% of the youth surveyed consider a university degree or

post-graduate degree as a requirement for their ideal job.

India is one of the youngest nations in the world, with

over 62% of the population in the working age group.

Approximately 250 million young people will be joining the

workforce over the next decade. The government had

launched the Skill India initiative, which aims to train over 40

crore people in India in different skills by 2022. Since then,

various schemes have been launched like Pradhan Mantri

Kaushal Vikas Yojana (PMKVY) to further the aim of skill

development, in order to enable a large number of youths in

the country to take up industry-relevant skill training that will

help them in securing a better livelihood.


ifimbschool.com

86

The Government of India aims to skill 402 million people

between now and 2022. Out of these, at least 110 million

workers are required in over 25 select sectors such as

textiles, automobiles, construction, banking and retail.

According to Prime Minister Sri Narendra Modi, India needs

to emerge as the global capital of human resources, the way

China is the factory of the world. Noting that India will have a

surplus manpower of 40 to 50 million over the next decade,

Modi emphasized the need to provide this manpower with

the skills and ability needed to tackle global challenges,

warning that the demographic dividend would otherwise

become a challenge. According to Sri Narendra Modi, for

India, employment generation and skill development are the

top priorities. According to him if China is recognised as the

‘manufacturing factory’ of the world, India can become the

‘human resource capital’. He also said

said the country needs to have a “futuristic vision” and draw

up plans for the next 10 years. There is a need for mapping

job requirements for both domestic and global markets and

then planning the skill development targets accordingly.

There is need to train youth keeping in mind jobs and

development.

According to S. Ramadorai, former Managing Director

and CEO of Tata Consultancy Services and Chairman of

the National Skill Development Agency, Skill India mission

had taken centre stage with the prime minister throwing

his weight behind it. “The social and economic impact of

building skills has taken centre stage. Skill is a national

agenda... and building skill is also a business opportunity,”

he said.Ramadorai underlined the need for an ecosystem,

giving the example of the US’s Silicon Valley. While skill

training is important, he said, promotion of entrepreneurship

is equally vital.

Prime Minister, Narendra Modi has suggested that the

government would work to promote both apprenticeship and

entrepreneurship. He said it is important for India to be able

to predict future possibilities, and to “prepare for them today

itself”. Job seekers, job providers, students and policy-

makers need to think alike, he added.

While Make in India would boost manufacturing sector

in India and create more jobs, Skill India aims to provide

a job-ready human workforce to the industry to enhance

productivity resulting in economic growth. The Prime Minister

launched the Pradhan Mantri Kaushal Vikas Yojana (PMKVY),

the skill and entrepreneurship ministry’s flagship skill training

scheme that aims to incentivize skill training by providing

financial rewards to candidates who successfully complete

approved skill training programmes.

Over the next year, PMKVY aims to skill 2.4 million youth,

across India. For the first time, the skills of young people

who lack formal certification, such as workers in India’s vast

unorganised sector, will be recognised. Through an initiative

known as ‘Recognition of Prior Learning’ (RPL), a million

youths will be assessed and certified for the skills that they

already possess. Prime Minister also launched a Skill Loan

scheme under which bank loans ranging from Rs.5,000 to

Rs.1,50,000 will be made available to 3.4 million youths

seeking to attend skill development programmes over the

next five years.

The Government of India also launched a skill card, which

can be used by employers to verify the training credentials

of job seekers. The Union cabinet recently approved the

merger of the National Council for Vocational Training

(NCVT) and the National Skill Development Agency (NSDA)

to “consolidate fragmented regulatory structures” and

improve the outcome of the Skill India mission. The merged

entity would be called the National Council for Vocational

Education and Training (NCVET).

As recently as in December 2018, the Prime Minister

introduced the 4E approach for the youth—education,

employment, entrepreneurship and excellence that

summed up the roadmap for the section of the population.

The quantum of personal time and space that the Prime

Minister has shared with the youth across various age

groups is unmatched, by any other premier, in the history

of independent India. The government’s reforms shall bear

fruit as further thrust towards areas such as job creation,

education, research and new age entrepreneurship would

stem India’s brain drain and instead, attract more young

talent globally.


ifimbschool.com

87

Boosting Services SectorFrom Prominence to Dominance

An avid Twitterati and among the most followed

leaders globally, Prime Minister Narendra

Modi tweeted on 20th October, 2018, “Dear

professionals associated with the IT sector,

technocrats and tech-lovers, I have a request...Have a look

at this Open Forum on the ‘Narendra Modi Mobile App”. It

was a clarion call to the highly skilled services professionals

of the country to be a part and leverage their skills for a New

India.

On 28th February, 2018, the Union Cabinet chaired by

Prime Minister Narendra Modi, approved the proposal of the

Department of Commerce to provide focused attention to

12 identified Champion Services Sectors for promoting their

development, and realizing their potential.

Services sector contributes over half of India’s GDP, and it

has attracted a lot of foreign direct investment with India’s

strength. The sector has built the economic structure by

contributing to exports and also for generating employment.

Such is the exuberance of India’s services sector, that

despite being a legacy driven agrarian economy, the sector

sums up India’s edge over rest of the major economies

of the world. Hardly a wonder then, that it contributes the

majority chuck of the national GDP.

India’s services sector covers a wide range of activities

including trade, hotel and restaurants, transport, storage and

communication, financing, insurance, real estate, business

services, community, social and personal services, and

services associated with construction.

MAAZ AHMED, HEMANT R, SHANKAR & PRUTHVI RAJ KULKARNI


ifimbschool.com

88

In February, an action plan was approved for ‘12’ champion

services sectors for realizing their potential through the

establishment of INR 5,000 crores dedicated fund. The

12 champion sectors include IT, Tourism and Hospitality,

Medical Value Travel, Transport and Logistics, Accounting

and Finance, Audio Visual, Legal, Communication,

Construction, and Related Engineering, Environmental,

Financial and Education.

The action plan for these sectors involve close monitoring of

grassroots level issues like, ‘does the sector have the right

regulatory framework for its smooth functioning? Do they

have the right service standards? Are there any infrastructure

gaps and how to address any bottlenecks should there be

one?’ of course, these require high octane monitoring and

watchdogs who could fetch real-time data for the ministries

to act.

The action plan is currently in its final stages. Under the

chairmanship of cabinet secretary, the plan is being revised.

With the action plan coming into picture, the government

aims to grow the economy in real ways, as opposed to

statistical data.

The government is trying to restructure the economy with

bold moves like demonetization and the GST roll-out. The

vision of the government is now clear.

The government is by and large involved in job creation.

MUDRA Yojana is testament to this. Prime Minister Narendra

Modi had said the MUDRA Yojana transformed the lives of

the poor. “MUDRA Yojana has opened up new avenues for

youth, women and those who wanted to start or expand

their businesses” As per the data on MUDRA Yojana’s official

website, almost 130 million people got loans under the

scheme till May 25, 2018.

The sanctioned amount under Mudra Yojana was INR 6 lakh

crore (INR 6,00,589.21 crore) out of which INR 5.81 lakh

crore (INR 5,81,283.18 crore) was disbursed.

There however were a few issues curtailing the reach of

Mudra Yojana. The average sanctioned loans under Mudra

Yojana comes at INR 46,530 while that of disbursed amount

is INR 45,034. This amount is inadequate for launching a

start-up employing others. But these cannot override the

core function of facilitating jobs generation. There have been

issues in fetching real-time data.

The ministry of Micro, small and medium Enterprises (MSME)

has adopted the cluster development approach as strategy

for enhancing productivity and competitiveness and capacity

building of Micro and Small Enterprises (MSEs) and their

collectives in the country. A cluster is a group of enterprises

located within an identifiable and as far as practicable,

contiguous area and producing same/similar products/

services.

To ensure sustainability and growth of MSEs by addressing

common issues, build capacity for common supportive

action, create/upgrade infrastructure in the new/existing

industrial areas/ clusters of MSEs; and set up common

facility centers.

Given the diverse nature of MSEs in terms of geography

and sectoral composition, the MSE-CDP scheme aims to

address the needs of the industries through well-defined

clusters and geographies. This will allow for achieving

the economies of scale for deployment of resources and

focusing on the specific needs of similar industries.

Infrastructure has also been a concern for these enterprises

to flourish smoothly and effectively. With technological

advents and particularly the government being invested in

Digital India, several technological services are deployed for

the existing enterprises. A total of 1,018 interventions across

clusters in 29 States and one UT have so far been taken up.

Assistance for interventions include (i) Preparation of a

Diagnostic Study Report with Government grant of maximum

INR 2.50 lakh for field organizations (MSMe-DIs) of the

Ministry of MSME; (ii) Soft Interventions with GoI grant of

75% of the sanctioned amount of the maximum project cost

of INR 25 lakh per cluster with provisions for North East and

SC/STs; (iii) Detailed Project Report (DPR) with GoI grant of

maximum INR 5 lakh for a technical feasibility and viability

report; (iv) Hard Interventions in the form of tangible assets

like Common Facility Centre with GoI grant upto 70% of


ifimbschool.com

89

the cost of project of maximum INR 15 crore.

For NE & Hill States, Clusters with over 50%

(a) micro/ village; (b) women-owned (c) SC/ST

units, the GoI grant will be 90%; (v) Infrastructure

Development with GoI grant upto 60% of the

cost of project of INR 10 crores, excluding cost

of land. GoI grant will be 80% for projects in NE

& Hill States, industrial areas/estates with over

50% (a) micro (b) women-owned (c) SC/ST units.

Some of the major developments and

investments in the services sector include

prospects of leisure and business travel and

tourism spending rising to INR 14,12,710 crore

and INR 80,640 crores in 2018, respectively.

Meanwhile, earnings from medical tourism could

exceed USD 9 billion by 2020 and the Indian

healthcare companies are furiously taking to

M&As with domestic and foreign companies to drive growth

and gain market.

The Centre recognizes the importance of promoting growth

in the services sectors and provides several incentives in

sectors like healthcare, tourism, education, engineering,

communications, transportation, IT, banking, finance,

management, among others. The PM has stated that India’s

priority will be to work towards trade facilitation agreement

(TFA) for services which is expected to help in the smooth

movement of professionals.

Services sector’s growth is governed by domestic and global

factors. The Indian facilities management market is expected

to grow at 17 percent CAGR between 2015 and 2020 and

surpass the USD 19 billion mark.

The implementation of the Goods and Services Tax (GST)

has created a common market and reduced the overall tax

burden on goods. It is expected to reduce costs in the long

run on account of the availability of GST input credit which

will result in a cut in cost of services. The government’s

constant efforts towards ensuring the robustness of the

services sector has led to:

●● A steep rise in India’s rank to 24th position, in the

World Bank’s Ease of Doing Business in 2018 from

137th position in 2014

●● Five times more growth in major ports’ traffic during

2014-18, compared to 2010-14

●● Six-fold increase in Government spending on

telecommunications infrastructure and services in

the country – from INR 9,900 crores during 2009-14

to INR 60,000 crores during 2014-19.

●● 11 projects worth INR 824.80 crore were sanctioned

under the Swadesh Darshan

●● Highest-ever revenue was generated by Indian IT

firms at USD 167 billion in 2017-18

The government has been asserting the importance of

economic growth for continuous growth. Over four years, the

Prime Minister and his team have made efforts to cement a

cohesive bond with different nations to facilitate economic

boom.

These strategic reforms to boost the services sector is

creating an enabling ecosystem for the industry to evolve

from being just a provider of skilled workforce to the global

IT industry to becoming a hub of product development,

product design and cutting edge innovation. Just pair that

with the government’s efforts to make India the world’s

manufacturing hub and what results is a 360-degree, end-to-

end indigenous capability to power India among the league

of the advanced economies.


ifimbschool.com

90

Quality education should be prioritized along with

literacy campaigns. We have been focusing on

the outlay, now it is time for us to concentrate

on the outcome of our education system”, said

Prime Minister Narendra Modi, in his 19th Mann Ki Baat

address on April 24, 2016.

Hitting the central nerve of India’s long-term development

agenda, the Prime Minister highlighted the urgent need to

create institutions that do not just impart knowledge but

also enhance India’s intellectual capital through research,

development and industry-academia collaboration.

Traditionally, India has, for decades, suffered the brunt of

brain drain, a phenomenon of ‘the movement of highly

Reversing Brain Drain and Harnessing

Yuva Shakti for India

dr. mafruza suLtana

LECTURER-ECONOMICS & STATISTICS, IFIM BUSINESS SCHOOL

“

skilled and qualified people to a country where they can

work in better’. Much of the reasons attributed for the brain

drain are related to a lack of adequate job opportunities,

poor research infrastructure and low funding for research,

among others.

Reports suggest that an estimated 17 million Indians were

living abroad in 2017. This has made the country the

largest source of international migrants; a 140+ per cent

increase year-to-date, since 1990 (Source: United Nations

Department of Economic Affairs). However, the trends are

changing as the government focuses more on the aspect

of creation of an enabling ecosystem for highly-skilled

professionals and scholars.

A few days before India’s 72nd Independence Day, Union

Minister Harsh Vardhan said, “Before Prime Minister

Narendra Modi, people used to talk a lot about ‘brain drain’.

People talk about ‘brain drain’ to some extent even now, but

they talk more about ‘brain gain’ now.” Higher education in

India has witnessed revolutionary changes under the present

government.

The East India Company took the initiatives for setting up

higher learning institutions in India in late 18th century and

India’s higher education system is the third largest, next

only to the United States and China. The University Grants

Commission (UGC) is the highest regulatory body for fixing

standards, advising government, and helping to coordinate

between the Centre and the state.


ifimbschool.com

91

The Indian higher education is undergoing rigorous reforms.

Under the Modi government, since 2014, some of the focus

areas have been transparency, strengthening of vocational

and doctoral education, and professionalization of the

sector through stronger institutional responsibility to help

reprioritize efforts and work around the complexities.

The rise of IT sector, engineering and management

education has limited students’ path to explore and discover

their passion.

Accreditation for higher learning is overseen by autonomous

institutions established by the UGC. As of 2016, India has

799 universities, with 44 central universities, 540 state

universities, 122 deemed universities, 90 private universities

and 5 institutions established and functioning under the

State Act. Other institutions include 39,071 colleges as

Government Degree Colleges and Private Degree Colleges,

including 1,800 exclusive women’s colleges, functioning

under these universities and institutions. There are

institutions of national importance, including IITs, IIMs, IIESTs,

AIIMs, NITs that function autonomously established by the

Government directly.

Central and state governments have been making efforts

to cultivate talent, mostly by increasing the number of

Universities and Colleges for higher education.

Table 1

Growth of Higher Education

institutions in India

Source: University Grants Commission, New Delhi (2012) & MHRD

Figure 1.b

Table 2 depicts the percentage of GDP spent on higher

education. It means, Central Government increased its

spend on higher education. From Table 1 and 2, it is

apparent that with increased expenditure, a number of

universities tripled and the number of colleges doubled.

Table 2

Expenditure on Higher Education

Source: University Grants Commission, New Delhi (2012)

From the above Table 4 and Fig 4 we can state the

enrolment in various programmes has grown considerably

Figure 1.a


ifimbschool.com

92

Table 3

Expansion of Universities and Colleges from 2011-12 to 2015-16

Table 3

Source: AISHE 2015-16

From the above Table 3 and Figure 3 it is clear under the present government there has been a continuous growth of universities and colleges.


ifimbschool.com

93

in the last 5 years (from 2011-12 to 2015-16),

which has increased from 2,91,84,331 in 2011-

12 to 3,45,84,781 in 2015-16. The overall

growth is 18.5%. It is clear that the enrolment

at all levels has increased.

The higher education system faces new

challenges like gender disparities in enrolment,

incomes and low-quality faculty and poor

motivation, and interest among students. Skill

shortages is a major factor for unemployment

among graduates. The challenges include:

● The rapid growth of private higher education

institutions due to non-availability of state funds

to expand higher education. In addition, small

and rural educational institutions have poor

funding. A number of institutions run self-

Table 4

Year wise (2011-12 to 2015-16) student enrollment

Source: AISHE 2015-16

Figure 4


ifimbschool.com

94

financing courses.

● India has an enrolment rate of 15%, much lower than the

developed and developing countries. Enrolment in higher

education is very low in rural areas. Post-Independence,

although the gender gap has reduced in enrolments, there is

disparity between departments.

● Inadequate infrastructure is another challenge faced

by higher education of India. Basically, the government-

funded institutions suffer from poor infrastructure, excluding

institutions of national importance.

Future challenges that need immediate attention

●● Quality of education should be linked to employability

by encouraging professional courses with innovative and

practice-oriented curricula.

●● Curricula need to be innovation-oriented that lead to

entrepreneurship.

●● Attract International students through international

student exchange programs.

●● Strengthening intellectual capital and infrastructure of

state universities and colleges through more funding to

develop infrastructure.

●● Autonomy of private sector Institutions through self-

financing courses.

Some of the initiatives for empowering education

institutions

●● UGC has granted graded autonomy to the top 60

universities.

●● National Testing Agency to conduct all professional

exams as per international standards.

●● Numerous scholarships provided to students to

complete their studies.

●● Vigorous attention devoted to teacher training to

produce top quality teachers.

●● 20 institutes will be declared as “Institute of

Eminence”.

●● Numerous universities, 7 IITs, 7 IIMs, 14 IIITs, 1 NIT,

103 KVs and 62 Navodaya Vidyalayas established

and have started functioning by modi government

According to a report commissioned by EY-FICCI titled, ‘State-focused Roadmap to India’s Vision 2030’, the government,

along with relevant stakeholders should build a world-class system of higher education that meets the national priorities and

fulfils aspirations of its people.

: Source: FICCI higher education summit 2015


ifimbschool.com

95

●● Major reform in education ensured by granting

autonomy to quality institutes by passing IIM Bill.

●● Recognizing talent with PM Research Fellowship

Scholarship worth INR 70,000 per month for 5 years

and INR 2 lakh annual grant for PhD and research.

●● To build innovative skills 2,400 Atal Tinkering Labs

sanctioned in schools at INR 20 lakh each.

●● Government of India also built 54,000 ramps

& railings and 50,000 special toilets for physically

challenged.

The government is working on a Bill for a single higher

education regulator. The regulator is expected to replace

existing regulatory authorities like UGC, AICTE and National

Council for Technical Education (NCTE).It will not have grant-

giving powers.

HEERA, unlike UGC, will “train/mentor institutions not

maintaining the required academic standards”. Central or

state government grants to an institution will require that they

meet the standards outlined by HEERA. Funding powers will

be largely vested with the HRD ministry which will release

grants based on action plans of institutions.

HEERA may provide expert advice to institutions for

‘promoting excellence’. If a university is found granting

affiliation to a course in contravention of regulations of the

HEERA, it may face a penalty, and withdrawal of degree

granting powers and in dire cases, even a direction to cease

all operations.

In spite of the numerous challenges faced by higher

education with its relatively-low Gross Enrollment Ratio

(GER), the current government is trying to focus on holistic

development through Khelo India, Pradhan Mantri Kaushal

Vikas Yojana and Yuva Shakti through Self-Employment.

Social reforms may be difficult to execute owing to the

numerous complexities, social and legislative, but the overall

quality of education has started to grow. Due to increased

expenditure the numbers of universities and colleges have

also increased. All universities and institutions if given the

autonomy to start self-financing courses particularly in areas

where job opportunities exist, shall lead to a tremendous

increase in the employability of our youth. This in turn shall

stoke a broad-based economic revolution that shall lead to

long-term, sustainable growth for the country.

The government has been proactively implementing

structural reforms and strategic initiatives that are beginning

to yield results. The real on-ground effect however, shall

be more visible by 2022, as the trickle down impact of the

reforms amplify.


ifimbschool.com

96

From the Licence Raj era that continued until the late

80s to the exuberance post liberalisation, India has

matured into a high growth, high potential economy.

As an essentially socialist economy, post-Independent

India has undergone some painful moments, registering a

Hindu rate of growth, followed by an extended phase of

cronyism. To be fair, while the GDP growth has accelerated

year-on-year, there still remain some quarters, reminiscent of

cronyism.

It is true that as a stable, thriving democracy in the heart

of Asia, our financial system has embraced the concept of

market efficiencies seamlessly, despite numerous challenges;

this has led to sophisticated and well-regulated capital

markets.

Leveraging Conscious Capital In

Education Sector

sanjay Padode

SECRETARY CENTRE FOR DEVELOPMENTAL EDUCATION

It would be worthwhile to note that, the very aspect of

market efficiencies, catalysed by higher literacy levels and

disruptive trends are critical to building a transparent and

competitive systems. After all, knowledge is power and

democracy by its virtue, empowers all its citizens.

As the youngest nation in the world, education, its allied

infrastructure and education policies form the triad of holistic

socioeconomic development. A majority of the 250 million

youths of India resides in its villages and the per capita

income currently stands at a little above $2,000. Considering

these two metrics, what should be the characteristics of the

education sector to propel India to its real potential?

The education sector is expected to cross $100 billion by

the end of FY2019. There are over 39,000 colleges and 900

universities across the country. The numbers are only expect

to swell.

While in absolute terms, India’s spend on the education

sector has increased, as a percentage of GDP it still falls

woefully short in terms of resources to fuel this juggernaut.

The primary reason, is the approach methodology which

prevents this sector from attracting private money and

reducing the pressure on the government.

The government has indeed been on its toes, to move in

tandem with the needs and changing trends. The Prime

Minister’s Skill India initiative to train 400 million youths by

2022, the Pradhan Mantri Kaushal Vikas Yojana, the National

Policy for Skill Development, the Unnat Bharat Abhiyan


ifimbschool.com

97

and the MHRD’s Ek Bharat Shreshtha Bharat campaign are

breath-taking, big bang reforms that are transformational.

But these fundamental structures have not yet been adopted

smartly, by the private sector.

Today, over 70% of higher education in the country is

delivered by the private sector. While not doubting the

altruistic motive of these institutions, it is unfortunate that

some of the decisions are not earmarked to the criteria of

maximum academic and social impact.

There are asymmetries that exist in the regulatory framework

that compel the private players to focus substantially on

the commercial viability aspect. Regulatory control and

cap on the fee structure leaves institutions with less room

to maneouvre. It puts an immense amount of pressure to

operate in a constrained financial environment.

Lets take a look at the maths. Promoters of institutions are

expected to own infrastructure during the floating of their

education venture. The edupreneur creates these more often

than not, by borrowing funds against either hereditary or

purchased land holdings. This imposes a cost of interest,

which is then passed on to the students in the form of

creative fee components. The tuition fee is then loaded to

provide for the 10-13% interest cost.

even profit, the key motive for any entrepreneur, comes at

a cost, as there are levies attached to it. The levy towards

these profits are discretely inducted in the form of services

fee for the various resources availed by students within the

institution’s purview. These amount to anywhere between

10-15% rise in costs of tuition fee.

Then comes the cost of marketing— from the student

acquisition to the campus placement, the total costs incurred


ifimbschool.com

98

are in the range of 25-30%. These too are factored in as

cost-to-student in the form of fees.

The result of these— bloated student loans. While in the US,

student indebtedness has already garnered national interest,

in India, its still insulated, but unfairly so. Most students in

India end up funding higher education through bank loans

by mortgaging family assets. It is interesting to note that the

student pays the interest on such bank loans and indirectly

for the financial costs for the institution funding. This is

indeed a double whammy.

Most students end up funding higher education through

bank loans by mortgaging family assets. Test preparation,

entrance examination fees, coaching etc. are the other

added costs that add to the total cost of education. It is time

to develop an ecosystem to deliver upon the true intent of

‘not for profit’ education.

The top-notch institutions globally, are funded through

endowments, grants, donations or state funding. They

receive significant funding for developing patents, offering

consultancy and research activities.

It is high time that the sector needs to develop a formal and

regulated mechanics of funding. There are enough and more

HNIs and institutions who may have the philanthropic desire

to participate in the education sector through grants and

endowment, even for a lower return.

The best formal mechanism for making this happen is

through the already mature capital markets of our country—

leveraging conscious capitalism to empower India through

education.

A new asset class could encourage the investors in capital

markets to fund educational institution and reap reasonable

returns which are tax free. This would allow the investors to

tap into the latent value of educating high potential academic

talent, while at the same time reaping the obvious monetary

and social benefits.

The investment vehicle in a social corporation which is public

limited is created for the purposes of delivering education.

Such a corporation should be permitted to distribute profits

not exceeding 20% of the net surplus generated and should

be provided with a tax exemption on its surpluses as long as

the corporation is recognised by the education regulators.

This could become a self-regulatory mechanism for funding

education in the future and also could be opened for funding

by foreign investors to attract overseas investment. The

already established regulatory mechanics of the capital

market will reduce the trust deficit associated with funding

education and provide a more attractive proposition for the

monies that are being spent overseas for the same purposes

by high net worth Indians.

Such an asset class would help reduce the dependency of

finance of private education on debt and the reduced burden

of interest would surely make more monies available with

the institution for investing into the quality of education. It

would also enable the genuine private educators to access

the capital markets and raise finance based on the credibility

established by their institutions in the education world.

The price discovery mechanism by virtue of free hand of

the markets, would develop market capitalisation for quality

institutions enabling them to raise larger resources with

lesser dilution.

It is commendable that the Government has formed the

Higher Education Funding Agency (HEFA) with the aim to

seek funds to improve and provide more robustness to the

institutions and the curriculum. Despite the noble intentions,

the initiative has not garnered sufficient interest among

investors.

Then what’s stopping the private sector and entrepreneurs to

sprint ahead and take a leap? For starters this model could

be called, the ‘Bharat EduShare’.

Supplement with Dalal Street Investment Journal Published : Alternate Monday (Mar 25, 2019)Apr 01 - 14, 2019

99

100RNI NO 43837/1986. Postal Registration No. MCW/325/2018-20 License to post without prepayment WPP License No MR/TECH/WPP-111/West/2019 Posted at Mumbai Patrika Channel Sorting Office, Mumbai-400001 Date of posting Alternate Thursday & Friday. Published: Alternate Monday (Mar 25, 2019)

from the editor's desk · 2019-04-03 · dr. chetan bajaj dr. rajendra k sinha dr. rajashree...

Documents