Union Budget 2017-18: A Gender Analysis by Prof. Vibhuti Patel MEDC March 2017

VOL. XLVI NO.
: 05 March 2017 84 Pages `80 ISSN 2456 - 2457
OPPORTUNITIES WITH INDONESIA
“Budget 2017:
Economic & Political
Fall Out”
Cover Page.indd 3 3/1/2017 5:57:54 PM

2 March 2017 Maharashtra Economic Development Council, Monthly Economic Digest
Add.indd 2 2/3/2017 2:48:20 PM

MEDC Governing Board From the Presidents....
MEDC President :
Cdr. Dipak Naik - President & CEO
Naik Environment Research Institute
A remarkable activity is on the anvil in the
beginning of March is that the “Indian Ocean
Rim Association (IORA)” will be celebrating its
Ltd. (NERIL)
20th Anniversary in March 2017. Indonesia, as the
current Chair of IORA, will host thee IORA
MEDC Vice Presidents
Leaders’ Summit on 7 March 2017 in Jakarta under
• Cdr. Anil Save - Mg. Director the theme”Strengthening Maritime Cooperation for
Atra Pharmaceuticals Pvt. Ltd. a Peaceful, Stable, and Prosperous Indian Ocean”.
• Mrs. Meenal Mohadikar - CEO The Summit will bring together twenty one IORA
Anand Trade Development Member nations and seven of its dialogue partners.
Service It is coincidental but very apt that this month’s digest
caries an article by the consul general of Indonesia.
• Mr. Ravi Boratkar -Jt. Mg. Director Our two countries share very deep rooted cultural, trade and religious ties for
MM Activ Sci-Tech many centuries in the past and will do so for many centuries to come.
Coomunications
Every year the novelty and newsworthiness of the budget normally subsides
MEDC Immediate Past-Presidents :
within a week or two and the nation reverts to its state of business as usual. The
• Dr. Vithal V. Kamat - Chairman budget this year which followed the best kept national secret of demonetization
The Kamat Group of Hotels has continued to reverberate through markets, conferences and through
• Mr. Nandkishor Kagliwal - Chairman discussions in academic circles well after the month is over. We therefore
Nath Group thought of bringing out the well thought out reactions of economists about the
aftermath of this budget.This issue of the Economic Digest therefore carries
Special Invitee : more weight of content as well as the number of pages. Most of the studied
• Mr. Chandrakant Sadadekar- opinions are much in line with MEDC’s stated reaction on the day of the budget.
Chairman We had stated that,“MEDC is of the view that the budget presented by Hon’ble
Sadadekar Global Group Finance Minister today is path breaking in many ways. Indian subcontinent is
undergoing a sea change of fiscal policies and consolidation. Demonetization,
• Mr. Anil Gachke - Chairman changing global scenario, protectionist policies of USA, need to ensure poverty
MEDC Industries Committee
reduction and necessary attention to sectoral needs is very well addressed in this
national budget. We expect that it will take some time for implementation of
the policy initiatives and therefore for the results to be felt and seen. In MEDC’s
view this budget is progressive and growth oriented like simultaneously clearing
up the menace of parallel economy”. Our learned authors have expressed
views such as ,”Long term benefits will over shadow the short term losses;”
Combination of faster growth of digital economy with GST and good
governance augurs well for the future of our country.” Some have appreciated
the application of mind and large fiscal effort made for farm credit, crop
insurance and soil improvements. Some authors have rungthe caution alarm and
have called it ambitious in sofar as pronouncements such as house for all by 2020
and doubling farmer’s income. One indicator that came straight out of the ballot
box is that most urban population has supported the demonetization and cleaner
corruption free governance as was seen from the municipal elections in our state.
On the last day of February we had a pleasant duty to perform. MEDC had
proposed to the government that we in Maharashtra must hold an “AERO
Business Show and MRO” event to promote regional connectivity and to
improve our share of manufacture and supplies for the global aviation industry.
We are pleased to state that this much needed high technology, high connectivity
and therefore high potential economic activity will take off in end November
from MIHAN in Nagpur……..but more about it when the event crystalizes
further.
Maharashtra Economic Development Council, Monthly Economic Digest March 2017 3
President Desk.indd 3 3/2/2017 3:49:52 PM

FROM THE PRESIDENT’S
VOL. XLVI NO. : 05 March 2017

CONTENT DESK
Page No. 10
● COVER STORY ●
Reflections on the
Budget 2017-18
03
16
● SPECIAL FEATURE ●
Indonesia Country Profile Trade
& Investment Opportunities 06
- Facts & Figures: A snapshot glance of relevant
statistics like Population, Land Area, Climate,
Form of Government, GDP, GDP per capita,
Inflation & Currency
- Mr. Sunil S. Bhandare - Senior Economist
Union Budget 2017- 18

Roadmap for Agriculture 20
- Ms. Sharmila Ghoshnath, Page No. 17
Author was Consultant Economist in Agricultural
Finance Corporation Ltd. as well as in MCX in Mumbai.
Budget 2017:
Economic & Political Fallout 23
- Mr. Nishant Shah,
Lawyer and a Chartered Accountant
- Mr. Mehfuz Mollah,
Regulatory Practice – including Competition Law and Trade
Law – Economist/Associate
Union Budget 2017-18:

A Gender Analysis 27 Page No. 24
- Prof. Vibhuti Patel
Professor & Head, Department of Economics,
SNDT Women’s University, Mumbai-20
Budget Focuseson Growthand

Fiscal Discipline Despite For
Midable Challenges 31
- Ms. Kiran Nanda
Author & Project Leader of number of national and
international assignments.
Currently working as a free-lance Economist. Earlier,
IMC- Director, Indian Merchant’s
Chamber’s research wing- “Economic Research & Training Page No. 47
Foundation” (IMC-ERTF)
Budget 2017 :
A Case Of Not Much Fiscal
Prudence 34
- Dr. Tulsi Jayakumar, Dr. R. K. Pattnaik
“India’s Fiscal Budget 2017 :

Economic & Political Fallout” 38
- Mr. Vijay Kalantri
President - All India Association of Industries
Vice Chairman - World Trade Centre Mumbai Page No. 55
Content Page 3.indd 4 3/2/2017 2:22:02 PM

Accounting And Accountability
Of Capital Expenditure Projects
By Government 41
- Mr. Ashok Datar - Economist
VOL. XLVI NO.: 05 March 2017 84 Pages `80 ISSN 2456 - 2457
Budget 2017: Economic and OPPORTUNITIES WITH INDONESIA

Political Fallout 44
- Mr. Dhananjay Samant “Budget 2017:
Author is an applied economist and social scientist
specializing in quantitative analysis, Page No. 57 Economic & Political
forecasting, and macroeconomic policy formulation. Fall Out”
The State of Education, Health,

Nutrition and Tribal development
in Maharashtra 47
- Ms. Manisha Karne
Professor in Development Economics
Department of Economics (Autonomous)
Decoding Electoral Bonds :

Union Budget 2017 55
- Ms. Ananya Prem Nath Page No. 58 Cover Page.indd 3 3/1/2017 5:57:54 PM
Manager- Research & Training in MEDC India

MEDC Economic Digest Editorial Board
Infrastructure Highlights’ of
last fi e years 7 Interim Chairman
- MEDC Research Team Cdr. Dipak Naik
Sonam Gupta & Dhanashree More
Chief Co-ordinator
● LO AL TRE ● Ms. Ananya Prem Nath
Manager - Research & Training
Global Trade and Investment
Trends 63 Editorial Advisor :
- Dr. Prakash Hebalkar, Dr. Prakash Hebalkar, resident, rofi ech
Dr. Hebalkar is a Public Policy consultant and Mr. Ravi Buddhiraja, IAS (Retd.)
President of ProfiTech, a strategic consultancy
Dr. Minu Mehta, Prof. IES-MR
Dr. B.N. Lad, Director (R&T), MEDC
Page No. 64
Current Topics 65
- Mr. V. T. Pai-Ex. Director – Finance, MEDC MEDC Response :
Ms. Sonali Jakatdar - Gen. Manager
● A A FACTS FI URES ● Mr. Suresh Ghorpade - Dy.Gen. Manager
STATE INCOME 66
Address :
● A A PARIYATA ● D esearch entre, rd oor,
Y.B. Chavan Centre, Nariman Point,
Lonar Festival 77 Mumbai - 400 021
Tel. : 2284 2206/09; Fax : 2284 6288;
● E SI E C● Email : medc@medcindia.com
Essay 79 www.medcindia.com
EMERG 80
MEDC & MDL 82
Mudra 82 Page No. 82
Content Page 3.indd 5 3/2/2017 3:56:29 PM

Special Feature
INDONESIA COUNTRY PROFILE
TRADE & INVESTMENT OPPORTUNITIES
Facts & Figures: A snapshot glance of relevant statistics like Population, Land Area, Climate, Form of Government,
GDP, GDP per capita, Inflation & Currency
Head of State : President Joko REVIEW OF INDONESIAN ECONOMY

Widodo
• he epublic of ndonesia is a nation blessed with almost all of the
Capital : Jakarta
Total area : 1,919,440 sq km prerequisites for transformation into a great economic power. With its
Population : 252.2 million (2014) abundant natural resources, large, productive and young population, and
Language : Bahasa Indonesia strategic access to the global mobility network, these assets and access empower
Religion : Muslim, Christian, Indonesia to be among the leading economies of the world.
Catholic, Buddhism,
Hinduism
Currency : US $1 = Rp. 13,200 • ndonesia is an emerging global powerhouse and member of the prestigious
(February 2017) G20. In 2015, with a Gross Domestic Product or GDP (Product Domestic
GDP Growth rate : 5.0 % (2016) Bruto or PDB) growth rate of 4.79%, Indonesia was the group’s third
Main Islands : Java, Sumatra, fastest-growing economy, only behind India and China. Today, Indonesia is the
Sulawesi, Kalimantan, largest economy in Southeast Asia and the world’s 16th largest economy with
Papua.
Main Cities : Jakarta, Capital City
almost a trillion dollar of GDP.
of Indonesia is the
government and an
economic center of
Indonesia. Surabaya,
Indonesia’s Second
largest city from East
Java, is leading
industrial centre and
seaport. other
important cities are
Bandung, Semarang,
Yogyakarta, Padang,
Medan, Palembang,
Makassar, Banjarmasin,
Bandar Lampung and
Manado.
Natural Resources : Petroleum, Tin,
Natural Gas, Nickel,
Timber, Bauxite,
Copper, Fertile
Soils, Coal, Gold, Silver
Agriculture MACROECONOMIC INDICATORS OF INDONESIA
Products : Rice, cassava (tapioca), Last Update: 09 February 2017
peanuts, rubber, cocoa, 2011 2012 2013 2014 2015 2016 2017¹
coffee, palm oil, Copra
Major Industries : Pulp and paper, • Gross Domestic Product²
6.2 6.0 5.6 5.0 4.8 5.0 5.3
cement, basic metals (annual percent change)
and fertilizer, power
• Consumer Price Index
generation, 5.4 4.3 8.4 8.4 3.4 3.0 4.0
telecommunication, (annual percent change)
transportation • Public Debt
Major Exports : Textile, electroni 26.6 27.3 28.7 24.7 27.0
(percent of GDP)
goods, footwear, oil &
gas, plywood, sawn • Exchange Rate
8,773 9,419 11,563 11,800 13,389 13,300¹ 13,300
timber (IDR/USD)
Major Imports : Chemical and pharm • Current Account Balance
ceutical, fertilizer, 0.2 -2.8 -3.3 -3.1 -2.1 -1.8 -2.3
cotton yarns, textile
(percent of GDP)
fabric, machines, • Population
motor vehicles. 244 247 250 253 255 258 260
(in millions)
INDONESIA COUNTRY_Special Feature.indd 6 3/2/2017 12:52:30 PM

Special Feature
• ollowing the abundance
2011 2012 2013 2014 2015 2016 2017¹
opportunities ndonesia has to offer,
• Poverty the government continues reforming
12.5 11.7 11.5 11.0 11.1 10.9
percent of population investment climate to ma e a safer
• Unemployment and more attractive investment
6.6 6.1 6.3 5.9 6.2 5.6
percent of wor force destination. resident o o idodo
• Foreign Exchange Reserves has mandated the implementation
110.1 112.8 99.4 111.9 105.9 116.4 of far reaching fundamental
in billion D
indicates a forecast reforms to create a solid foundation for
tatistics ndonesia shifted the basis of the computation from the ear to and businesses to grow and prosper for
adopted a significantl updated methodolog , hence D growth results between and the long term. ndonesia is at the
have been revised in earl beginning of a promising new era.
ources orld an , tatistics ndonesia, an ndonesia and nternational onetar und
• he strength of ndonesian
• nderl ing ndonesia s vibrant econom is political stabilit . ndonesia has econom rest on the countr s
succeeded maintaining political stabilit as the world s third largest democrac . enormous natural resources oil
• ndonesia ran s the fourth most populous countr in the world. ts and gas, coal, copper, gold, forestr
million population and the rapidl increasing bu ing power of its population is and plantation products and
creating a significant mar et. oreover, the oung population is also increasing manufacturing for the domestic and
in the ualit of its human resources, thus providing a desirable competitive e port mar ets te tiles, footwear,
edge. electronics, automotive, pulp and
paper . a or sector of the econom
• ndonesia has an abundance of renewable agricultural products and include oil and gas, mining,
un renewable mining and minerals natural resources. t is the world s largest agriculture, plantations, fisheries,
producer of palm oil, and the world s second largest cocoa and rubber transport and communications,
producer. he countr also produces tin, nic el, coal, natural gas, bau ite, ban ing and financial services and
copper and gold in large uantities. t must be able to optimize the handling of tourism.
its natural resources b increasing a processing industr that will provide high
added value.
Natural Resources : Petroleum, Tin, Natural Gas, Nickel, Timber, Bauxite, Copper, Fertile Soils, Coal, Gold, Silver
Agriculture Products: Rice, cassava (tapioca), peanuts, rubber, cocoa, coffee, palm oil, Copra
Major Industries : Pulp and paper, cement, basic metals and fertilizer, power generation, telecommunication, transportation
Major Exports : Textile, electronic goods, footwear, oil & gas, plywood, sawn timber
Major Imports : Chemical and pharmaceutical, fertilizer, cotton yarns, textile fabric, machines, motor vehicles.
10 Major Products for Exports : Textile and Textile Products, Electronic, Rubber and Article thereof, Palm Oil, Forest Products,
Footwear, Automotive, Shrimps, Cocoa, Coffee
10 Potential Products for Exports : Leather & Leather Products, Medical Instrument and Appliance, Medicinal Herb, Processed
Food, Essential Oil, Fish & Fish Products, Handicraft, Jewellery, Spices, Stationery Non Paper.
BALANCE OF TRADE OF INDONESIA - Period : 2011-2016
alue illion
NO Description 2011 2012 2013 2014 2015 TREND Jan-Dec* CHANGE
(%) (%)
2011-2015 2015 2016 2016/2015
I EXPORT 203.496,6 190.020,3 182.551,8 175.980,0 150.366,3 -6,59 150.366,3 144.433,5 -3,95
L . , . , . , . , . , , . , . , ,
L . , . , . , . , . , , . , . , ,
II IMPORT 177.435,6 191.689,5 186.628,7 178.178,8 142.695,6 -4,96 142.694,8 135.650,7 -4,94
L . , . , . , . , . , , . , . , ,
L . , . , . , . , . , , . , . , ,
III TOTAL 380.932,2 381.709,7 369.180,5 354.158,8 293.061,9 -5,82 293.061,1 280.084,2 -4,43
L . , . , . , . , . , , . , . , ,
L . , . , . , . , . , , . , . , ,
L . , . , . , . , . , . , . , ,
L , . , . , . , . , . , . , ,
L . , . , . , . , . , , . , . , ,
Source: BPS, Processed by Trade Data and Information Center, Ministry of Trade

Special Feature
Economic Stimulus Packages of the Indonesian Government:
Since September 2015 the Indonesian government has unveiled fourteen thirteen economic stimulus packages. These
packages aim to boost economic growth in Indonesia through deregulation, tax incentives and by opening room for
foreign investment.
Package Unveiled Main Points
• oost industrial competitiveness through deregulation
1st 9 September 2015 • urtail red tape
• nhance law enforcement business certaint
• nterest rate ta cuts for e porters
2nd 30 September 2015 • peed up investment licensing for investment in industrial estates
• ela ation import ta es on capital goods in industrial estates aviation
3rd 7 October 2015 • ut energ tariffs for labor intensive industries
• i ed formula to determine increases in labor wages
4th 15 October 2015 • oft micro loans for small medium, e port oriented, labor in
tensive businesses
• a incentive for asset revaluation
5th 22 October 2015 • crap double ta ation on real estate investment trusts
• Deregulation in slamic ban ing
6th 5 November 2015 • a incentives for investment in special economic zones
• aive income ta for wor ers in the nation s labor intensive industries
7th December • ree leasehold certificates for street vendors operating in
state owned designated areas
• crap income ta for categories of airplane spare parts
8th December • ncentives for the development of oil refineries b the private sector
• ne map polic to harmonize the utilization of land
• ingle billing s stem for port services conducted b s
• ntegrate ational ingle indow s stem with inaportnet s stem
• andator use of ndonesian rupiah for pa ments related to transpor
9th 27 January 2016
tation activities
• emove price difference between private commercial and state postal
services
• emoving foreign ownership cap on businesses
10th ebruar
• rotecting small medium enterprises as well as cooperatives
• Lower ta rate on propert ac uired b local real estate investment
trusts
• armonization of customs chec s at ports to curtail dwell time
11th arch
• overnment subsidizes loans for e port oriented small medium
enterprises
• oadmap for the pharmaceutical industr
• nhancing the ease of doing business in ndonesia b cutting
12th 28 April 2016
procedures, permits and costs
13th 24 August 2016 • Deregulation for residential propert pro ects for low income families
• reating a roadmap for the nation s e commerce industr
easing and widening access to funding
offer ta incentives
harmonize regulations and graduall develop a national pa ment
14th 10 November 2016 gateway
promote e commerce awareness campaigns and improve e commerce
education
accelerate the development of high speed broadband networ
improve the e commerce logistics s stem

Special Feature
for ndonesia as a global maritime
ne us”.
• ndonesia being an archipelagic

state will develop marine based
economic activities through bilateral,
regional and global co operations.
ill encourage D in maritime
infrastructure development,
doc ards, fisheries industries,
improvement of maritime
connectivit that will support
logistical movement.
• ndonesia will boost bilateral

cooperation aimed at among other
ransfer of echnolog and now
how, research and capacit building
in the field of ship industr , fisher
industr .
• ndonesia will improve fisher

products to meet international
standard through the establishment
of mutual recognition arrangement
• ndonesia will promote rade,

ourism and nvestment
including inward investment and
outward investment.
• ndonesia will support the

achievement of food and energ
resilience.
Foreign Direct Investment in

Indonesia
Indonesia’s Foreign Policy • nvestment has a large multiplier
• ndonesia s foreign polic in the ne t five ears will be based on the effect in boosting economic growth,
following priorities . aintaining ndonesia s sovereignt ndonesia creating ob opportunities, and
diplomac will protect the territorial sovereignt of the epublic of shifting the current consumption
ndonesia. . nhancing the protection of ndonesian citizens and legal entities based econom to an econom
rotection of ndonesian citizens including migrant wor ers and legal entities driven b production. herefore, as
will be further improved . ntensif ing conomic Diplomac egional a government agenc and primar
and international cooperation in the fields of maritime infrastructure, energ , interface between the government
fisher and the protection of the marine environment will be intensified. and investors, as well as service
provider related to investment,
Indonesia’s New Government - Economic and Security it is the roles of he ndonesia
Challenges nvestment oordinating oard
adan oordinasi enanaman
• ndonesia s new president, . . r. o o o owi” idodo, wants to tac le odal or to improve
conomic and ecurit challenges and embrace ndonesia s geograph as an investment climate and to invite
asset. aritime polic will be a top priorit for ndonesia s new government for smart investment” to the
first few ears, which offers other countries opportunities for cooperation on archipelago. overnment of
maritime securit . ndonesia s new resident have made reference to his vision ndonesia has a strong reform

Special Feature
agenda and since January 2015, • D realization five leading sectors etal, achiner and lectronic
several policies have been ndustr . billion ; hemical and harmaceutical ndustr .
implemented. First, the One-Stop billion ; aper and rinting ndustr . billion ; ining .
Service-Center (Pelayanan Terpadu billion ; and ransport uipment and ther ransport ndustr .
Satu Pintu or PTSP) at BKPM billion . eanwhile if the industrial sectors are combined, it can be seen that the
aimed at providing a faster, simpler, industrial sectors contribute . billion atau . to the total D
and more transparent investment realization.
licensing service. Second, an end-
to-end service for investors, starting • D realization based on locations five biggest locations are est ava
from earlier until commercial stage, . billion ; pecial erritor of a arta . billion ; anten .
including facilitation during the billion ; outh umatera . billion ; and ast ava . billion .
process of investment realization.
nd finall , improvements of
investment climate, among others by
providing more attractive incentives
and facilities for investors.
• nternational recognition regarding

ndonesia s econom are the recent
upgrades of the countr s credit
ratings b international financial
services companies such as Standard
oor s, itch atings and ood s.
esilient economic growth, low
government debt and prudent fiscal
management have been cited as
reasons for the upgrades and are key
in attracting financial in ows into
ndonesia both portfolio ows and
foreign direct investment D .
Foreign Direct Investment

(FDI) in Indonesia in 2016
• oreign Direct nvestment
ealization for ear .
billion
• he D realization five leading

countries ingapore .
billion ; apan . billion ;
eople s epublic of hina .
billion ; ong ong . billion ;
and etherlands . billion .

Special Feature
• During this visit ndia ndonesia
s orum was held in ew
Delhi on December . he
s orum comprised of
members from each side with the
forum discussed and arrived at
constructive suggestions to further
enhance bilateral trade and
investment cooperation. lso during
the visit had meeting of a select
group of twent ndian s
with resident o o idodo on
December , with during the
meeting the resident encouraged
the ndian companies to invest in
ndonesia.
Launching of Garuda
Indonesia Airlines
• n th December ,
ndonesia s ag carrier, aruda
ndonesia officiall inaugurated its
ight to umbai, ndia connecting
sia s sub continent with the
sprawling ndonesian archipelago.
ircrafts operated for this route are
oeing s that have a total
capacit of passengers. aruda
ndonesia s a arta umbai ight
via ang o operates
three times wee l on onda s,
ednesda s and rida s. he
opening of the a arta umbai via
ang o ight is e pected to boost
connectivit between ndia and
ndonesia.
INDIA - INDONESIA
State Visit of President Joko Widodo to India BILATERAL RELATIONS
• . . r. o o idodo, resident of the epublic of ndonesia paid a tate ndonesia and ndia has the long
visit to ndia from December, at the invitation of rime inister standing relations, histor has made
of ndia . . r. arendra odi. resident o o idodo and rime inister ndonesia and ndia particularl
arendra odi held tal s and reviewed the scope to increase the bilateral close to each other. his relation is
relations in various sectors such as trade, defense securit and energ . endorsed with uni ue characteristics.
oth countries share much in
• hree agreements were signed during the visit o on outh ffairs common geographical e panse,
and ports ooperation; o on tandardization ooperation; and oint size and diversit of the population,
ommuni ue on llegal, nregulated and nreported ishing and o culture, histor and a colonial past as
romote ustainable isheries overnance. he two sides also issued a oint well as the similar direction of foreign
tatement on aritime ooperation which mandates both sides to draw up a policies in the post independence era.
o for cooperation in this area. istor informed us that the ndia
ndonesia relation dates bac to first
centur D anno Domini . he start
was made b ndian traders, who

Special Feature
were the first to arrive in ndonesia developmentpush and a networ of ualit education institutions, ma e ndia
in st entur . enceforth both and the ndian companies the most promising business partners toda .
nations have been having trade
and cultural lin s for the last NDONESIA – INDIA BILATERAL TRADE
ears. ndonesia and ndia en o a
high level mutual beneficial relation. (US $ billion)
mplementation of ndia YEAR EXPORTS IMPORTS TOTAL
ree rade greement has TO INDIA FROM INDIA TRADE
contributed a lot to increase the trade . . .
relations between our two nations. . . .
he bilateral trade between ndonesia
and ndia has reached to . . . .
billion in the ear . . . .
. . .
owever the bilateral trade relation
. . .
between two countries has not been
satisf ing et in other sectors apart . . .
from oal and rude alm il . . .
which is dominating while other . . .
potential commodities from both
the countries have not been traded 2015 11.71 2.74 14.45
et significantl instead of oal and 2016 (JAN-OCT) 8.09 2.25 10.34
. owever, concrete plans have ource inistr of rade, epublic of ndonesia
to be effective to overcome this issue.
he close economic cooperation
between ndia and ndonesia • here is a considerable potential for e panding trade in the areas of
could also be re ected in both our automotive components, automobiles, engineering products, ,
capacities as member countries of the pharmaceuticals, bio technolog and healthcare sectors. iven their strategic
where our common economic significance, nfrastructure development and energ , both traditional and
interests could be brought to renewable, are e areas for enhancing the bilateral cooperation.
attention. fter all, both ndia and
ndonesia has proven their economic • oth the countries should put in place suitable policies to encourage private
strength through their ever increasing sectors to ma e investments in infrastructure and manufacturing sectors and
D which puts us both in the one for this the two governments must be willing to provide a predictable and
trillion dollar club. comprehensive legal and ta ation frame wor .
• Despite the large size and rapid • Direct trade between the two countries would automaticall result in a
growth, the trade and investment win win situation. rade through third countries had an added cost, hence while
between ndia and ndonesia remains ta ing note of same the business communities of both the countries should be
modest. here is a need to s nergize encouraged to have direct trades between the two countries.
our efforts in the areas of econom
and business to correct the sectoral • oth countries should wor together to bridge the nowledge gap about
and directional imbalance of our investing in each other s countries b facilitating more fre uent e change of
trade and to further diversif it. he delegations.
vast consumer mar et, outhful and
s illed human resources and e pertise • ore discussions between sta eholders need to ta e place, especiall in the
in the field of information business sector. hile ta ing note of the significance increase of international
technolog of ndia coupled with trade of both countries, we have alwa s urged business leaders from ndia
ndonesia s natural resources, outhful and ndonesia to come forward to e plore trade opportunities, especiall in
population and strategic location filling gaps in both countries. Direct trade between the two countries would
would provide a platform for enhanced automaticall result in a win win situation.
economic engagement. he
innovative spirit of ndian • ndia is one of the most important engines of the world s economic growth.
industr , bac ed b a strong he a e in ndia” move is considered as a brea through to open the
government research and countr s econom for investment. ndonesian companies are e pected to

Special Feature
invest in India to strengthen ties between both countries. The business oil seed, motor vehicle for goods
partnership in sectors such as financing, automotive and te tile must be transportation, animal feed, cotton,
increased and strengthened as both countries have such huge mar ets in those at rolled product, allo steel.
sectors.
ain items of ndia s mports
• here has been general ignorance among the ndian people about from ndonesia i ed vegetable fats
Indonesian and vice versa. Both the countries have yet to see the urgency oils, oal, opper ores, natural
of intensif ing cooperation particularl in the economic, scientific and rubber, pulp waste paper, alcohols
technological, and social and cultural. phenols, h drocarbon, machine
tools, medicinal and pharmaceutical
India’s Investment in Indonesia products, fertilizers, paper and
paperboard, carbo lic acids, d eing
• India’s investment in Indonesia is continuousl increasing in various
tanning e tracts, other chemical
sectors such as te tiles, metal, automotive, machiner , coal and electronics.
products
ndian investors operating in ndia are among others ata, eliance, a a and
. hile targeting the origin of the countries, apan, outh orea,
otential reas of nerg
and aiwan which has been the main investment sources, now targets
achine tools and hand tools.
new investors from the iddle ast region, hina, and ndia. n regards to
orging, foundr and dies, lectric
potential investment, ndonesia offers investment opportunities in various
motors and switches, umps and
sectors such as energ conventional as well as renewable energies , ood,
ompressors, ransmission towers,
nfrastructure, ining, utomobile, ower, anufacturing, griculture, e tile
ement, sugar and fertilizer plants,
and nformation echnolog .
ower generating machiner ,
STATISTIC OF FOREIGN DIRECT INVESTMENT REALIZATION BY COUNTRY OF ORIGIN 2007 – 2016

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
I I I I I I I I I P I
D
17 , 20 17.8 31 , 44 , 41.9 58 78.1 121 . 137 37.1 57.2 485 55
Source : Indonesian Investment Coordinating Board (BKPM):
1. Excluding of Oil & Gas, Banking, Non Bank Financial Institution, Insurance, Leasing, Mining in Terms of Contracts of Work, Coal Mining in
Terms of Agreement of Work, Investment which licenses issued by technical/sectoral agency, Porto Folio as well as
Household Investment.
2. P : Total of issued Permanent Licenses
3. I : Value of Direct Investment Realization in Million US$.
4. Tentative data, including Permanent Licenses issued by regions received by BKPM until December 2016
Indonesia’s investment in India omputer software, ood, paper

• he ndonesia s investment in ndia for the period from to pulp, alm oil, L as
ep . million . hile under the urisdiction of ndonesian
onsulate eneral, umbai was . million. ource oreign nvestment urther there is immense scope
romotion oard of ndia, inistr of inance for both countries to increase their
ties and cooperation in the fields of
• ndonesia s investment in ndia especiall under the urisdiction of science and technolog , agriculture,
ndonesian onsulate eneral, umbai are amudra hipping, umbai for ecological conservation, information
Logistics argo ervices, anindo eeds, angalore for eeds and gricultural technolog , biotechnolog and other
roducts, nbisco ndia, hmedabad for iscuits, offee, andies, hocolate, areas of common interest.
apfacomfeed for production of poultr feed and breeding, aruda ood,
angalore for ood everage, ndofood, erala for food products • India can offer to Indonesia
noodles , uantum elect ndonesia, umbai for placement services and nabatic c nowledging ndia s all round
echnologies, angalore for nformation echnolog , aruda ndonesia development, we do agree that ndia
irlines, umbai for irlines. has a lot to offer to ndonesia
especiall in the areas of ,
Scope for India-Indonesia bilateral relations ducation, ealth and
harmaceutical, achineries and
ain items of ndia s ports to ndonesia etroleum products, automotive sectors. he ndonesian
telecommunication e uipment s and parts, h drocarbons and derivatives, businessmen will definitel loo

Special Feature
at the vast opportunities in these Fax : (62-21)5254945 IMPORTANT TOURISM CONTACTS
sectors and work with their Indian Homepage : www.bkpm.go.id FOR INDONESIA
counterparts. On other hand E-mail : sysadm@bkpm.go.id
INDONESIAN MINISTRY OF
Indonesia can also learn from strong
KAMAR DAGANG DAN INDUSTRI TOURISM
industrial sector in India particularly
INDONESIA Sapta Pesona Building, Jl. Medan Merdeka
at inter-mediatory and downstream
Indonesian a er of o erce and Barat No. 17, Jakarta 10110, Indonesia
processing industries. Both
Ind str Tel. (62-21)383 8167
countries should work together to
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bridge the knowledge gap about
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investing in each other countries as
Indonesia www.indonesia.travel
well as in processing industries by
Telephon : [62-21]-5274484 (hunting)
facilitating more frequent exchange VISIT INDONESIA TOURISM
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visit of delegations including I I
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participation in focused trade fairs B-31/A, Kalkaji, New Delhi 110019, India
or kadin@kadin-indonesia.or.id
and in various business conferences Website : www.kadin-indonesia.or.id
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programmes. INDONESIAN CHAMBER OF Mobile: +91 9811325456
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Contact address of major India o ittee
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Chambers of Commerce, major Chairman: Mr. Nalin Rathop PT. Bakrie
an s nancia instit tions and lobal entura a rie ower th oor, EMBASSY OF THE REPUBLIC OF
ot er re ated associations Komplek Rasuna Epicentrum Jl. H. R. INDONESIA
Rasuna Said Kav. B2, Jakarta 12920, 50-A, Chanakyapuri, New Delhi - 110 021,
INDONESIAN MINISTRY OF
Indonesia India.
INDUSTRY
Tel : (62- 21)29912099; Tel : (91-11)26118642-47
Jl. Gatot Subroto Kav 52-53 Lt. II,
Fax : (62-21)29912090 Fax : (91-11) 26885460, 26886763,
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Tel : (62-21)5256458, 5251149, 5200700
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Fax : (62-21)5201606
Homepage : www.kemenperin.go.id Indonesian a er of o erce and
CONSULATE GENERAL OF THE
Ind str
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I siness ort es
TRADE 19, Altamount Road, Cumballa Hill, Mum-
enara adin ndonesia, th .,
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an Indonesia INDONESIAN CONSULATE IN
NATIONAL EXPORT
Jl. M.H. Thamrin No. 2, Jakarta 10350, I
DEVELOPMENT
Indonesia 2D,’Eldorado’, 112,N.H. Road,
MINISTRY OF TRADE OF
Tel : +6221 29810000 Chennai-600 034
REPUBLIC OF INDONESIA
Web : www.bi.go.id Tel : (91-44) 28206845 / 28206085/
Ministry of Trade Building II, Jl. M. I.
28253337
Ridwan Rais No. 5, 3rd, 4th, 13th, 14th
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Floor, Central Jakarta, Indonesia.
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Phone : (62-21) 385 81 71
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3rd Floor Ispahani Center, 123/124
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Phone : +91 44 4208 9196
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Special Feature
INDIAN DIPLOMATIC MISSIONS INDONESIAN IMPORTANT WEBSITES
IN INDONESIA Indonesian National Portal : www.indonesia.go.id
Indonesian Ministry of Industry : www.kemenperin.go.id
EMBASSY OF INDIA Indonesian Ministry of Trade : www.kemendag.go.id
Jalan H.R. Rasuna Said, Kav. S-1, Kuningan, Indonesian Coordinating Ministry for
Jakarta Selatan 12950 Economy : www.ekon.go.id
Ministry of Tourism : www.indonesia.travel
Tel : 62-21-5204150 /52 /57/5264931 Indonesian Ministry of Foreign Affairs : www.kemlu.go.id
Fax : 62-21-5204160, 5265622, 5264932, Indonesian Investment Coordinating Board : www.bkpm.go.id
5226833 Bank Indonesia (Indonesian Central Bank) : www.bi.go.id
Web : www.indianembassyjakarta.com Indonesian Central bureau of Statistics : www.bps.go.id
Indonesian Directorate General for
Customs & Excise : www.beacukai.go.id
CONSULATE GENERAL OF INDIA Indonesian Daily News (English) : www.antara.co.id
19, Jl. Uskup Agung A. Sugiopranoto, Indonesian Daily News (English) : www.thejakartapost.com
Medan (Indonesia) Indonesian Yellow Pages : www.yellowpages.co.id
Indonesian site for expatriates : www.expat.or.id
Tel.+62 61 4531308/ 4556452 Jakarta Convention Centre -
Fax. .+62 61 4531319 Exhibition Calendar : www.jcc.co.id
E-mail: cgimedan@indosat.net.id Indonesian Exhibition Companies Association : www.ieca.or.id
Jakarta Int’l Fair Grounds -
Web : www.congendiamedan.or.id
Exhibition Calendar : www.jiexpo.com
Indonesia Companies and Market Research : www.disb2b.com
Consulting Group - Indonesian
Industrial Report : www.cic.co.id
Castle Asia on Indonesia : www.castleasia.com

Cover Story
e ections on t e
d et
ni andare
Senior Economist
Mr. Sunil S. Bhandare sunil.bhandare@gmail.com
ettin t e ers ecti e personal income ta pa ers f especiall in emerging mar et and
n the budget eve, there was a urr course, there might be much more developing economies. However,
of expectations and that perhaps was that experts would still seek to there is wide dispersion of possible
not unusual, albeit not being totall unravel from the budget, even as the outcomes around the projections,
realistic either. Two basic reasons for inance inister would be ma ing given the uncertaint surrounding
the same were first, the government some obvious fine tuning of the the polic stance of the incoming
has to offer substantial reliefs and budget provisions. The ensuing adminis tration and its global
concessions, given the setback and second Budget Session of the ramifications”. Li e wise, the orld
pains caused b demonetization; Parliament, which would begin from Bank points out: “Stagnant global
second, this is the crucial fourth arch , ,would be ver relevant trade, subdued investment and
budget – the penultimate before in this respect. The discussions heightened polic uncertaint mar ed
the next general elections in 2019 – on specifics of the budget, and in another difficult ear for the world
wherein the approach would have to particular, of the inance ill would econom . moderate recover is
be path-breaking. Thus, most keen then be occup ing the centre stage in expected for 2017, with receding
observers, across various sections of the Parliament. obstacles to activit in commodit
the econom from farmers to traders; exporters and solid domestic demand
from large corporates to MSME urel the budget is alwa s a in commodit importers. ea
sector; from high net worth contextual workout– not just investment is weighing on medium
professionals to low-income middle economic, but more often than not term prospects across man
class households; from consumers political too. Thus, its framing is emerging markets and developing
to savers and investors virtuall all generall hugel determined b the economies D s . lthough fiscal
of them had fi ed their goals and backdrop of current and emerging stimulus in major economies, if
e pectations ver high. hat, there global and domestic socio-economic implemented ma boost global
fore, became apparent from various scenarios. This budget is no growth above expectations, risk to
reactions to the budget 2017-18 was e ception. llustrativel , let us growth forecasts remain tilted to
that it was inadequate and somewhat mention onl two ma or happenings the downside. Important downside
disappointing. It failed to generate ris s stem from heightened polic
enough enthusiasm; it was a usual irst, the global economic uncertaint uncertaint in ma or economies.”
‘mixed bag’ of positives and negatives. this aspect is elaboratel evaluated
Of course, the political opponents, in the recent pdate on orld econd, near home, the primar
as is their wont, were vehementl conomic utloo and the orld concerns have been associated with
critical; most of them could not Bank’s Global Economic Prospects demonetization disruptions, which
decipher an good feature in the eport. learl , both these reports severel hit farmers, informal sector,
budget! emphasize the heightened polic unorganized retail, real estate and
uncertaint , especiall in advanced construction, etc. The Economic
At the same time, the general perception countries – be it arising from the urve has sought to
has also been that there are neither polic stance of new resident uantif its macro economic damage,
major surprises nor disappointments Donald Trump, BREXIT, the while pointing out that “India’s
nor an hic ups. videntl , the inance growing anti globalization tirade or demonetisation is unprecedented,
Minister has offered a vast spread of geo political tensions. hus, the representing a structural break from
polic measures as well as e penditure observes: “After lackluster outturn in the past. This means that forecasting
and tax proposals, while hitting , economic activit is pro ected its impact is hazardous ... the attempts
a little bit more the high-income to pick up pace in 2017 and 2018, at uantification must conse uentl
Sunil S. Bhandare_Cover Story.indd 16 3/2/2017 1:50:30 PM

Cover Story
be seen as tentative and far from period from . to . and further to . again the lowest over
definitive”. urther it states or the last over two ears; c secular decline in the current account deficit D
nominal D , the impact would be to D ratio and stead build up of fore reserves heralding the e ternal
lower growth between percentage stabilit the D D ratio has fallen from worrisome . in to and
points and percentage point a comfortable level of . in . ore reserves are now at an all time high
relative to the baseline of per of bn, affording import cover of well over months; e relativel stead
cent. or real D the impact would e change rate illustrativel , the average monthl rate of the has remained
be between percentage points and in a narrow range bound between s. . and s. ; and f
percentage points relative to the consistent improvement in the revenue and fiscal deficit ratios of the entral
baseline of per cent...... that the ovt. lease see the chart below .
adverse impact of demonetization
on D growth will be transitional.
nce the cash suppl is replenished,
which should largel be achieved b
end arch , the econom should
revert to normal, perhaps even with
a bounce re ecting reversion to the
mean. herefore, real D growth
in is pro ected to be in the
percent range”.
et, there have been growing concerns about the econom . urel , it is bogged
an other official and non official down b a prolonged phase of deceleration in the investment ratio; a slow
estimates have been made about the pic up in the stalled infrastructure pro ects; onl a modest growth in the
damage to economic growth as an organized industrial sector namel , growth numbers ; the rural distress;
aftermath of demonetization. uffice the twin balance sheet problems of large corporates and ban s mani festing in
it to sa , the econom has suffered concerns about overleveraged position of corporates and progressive
a sharp setbac in ct Dec of e pansion in s and stressed assets of ban s; obless growth;and several
, and this ma spill over to others. o while the inance inister did have comforts of macro
of the current ear, but perhaps with fundamentals, he has been confronted with such multiple and massive
much lesser intensit . ver single challenges in shaping the path of his crucial fourth budget.
such estimate shows a downward
revision, of sa to basis points, ar more severe arethe constraints of fiscal space despite sustained fall in e
in the growth rate. ffectivel , deficits to D ratios over the last si ears. hus, li e his man predecessors,
ndia s real D growth rate would the inance inister run aitle has also been confronted with a relativel
linger around or lower in inade uate ta buo anc ; b limited efforts to augment non ta revenues,
as against . in the previous especiall from disinvestments or strategic sales; c acute urgenc to
ear. n substance, this crudel is the step up capital e penditure on infrastructure, rural development and social
price which the nation can be said to sector; d rising e pectations of ta reductions and incentives; e demands
have paid for demonetization in the for interest subventions and or loan waivers from farmers as well as b those
short run. severel affected b adverse impact of demonetization; etc. he comforts of
falling deficits to D ratio are greatl neutralized if one were to loo at the
Sound Fundamentals, government s e penditure structure. hus, despite the recent efforts to anchor
But..... revenue spending, it still accounts for a predominant share of total
gainst this bac drop, it must be e penditure; indeed, unavoidable interest pa ments . establishment
recognized that ndia still continues costs . defence . subsidies . all together pre empt a
to have sound and stable macro huge part of total governmental e penditure.
economic fundamentals. hese
manifest in a falling in ation rate The Finance Minister’s Response
the in ation rate o basis , ow then has the inance inister sought to steer the path of his budgetar
after moving up from in challenges and move forward with his goal of transform, energise and clean
arch to . in ul has ndia”, and at the same time, fortif her status as a bright spot in the world
consistentl declined to a two ear economic landscape”. mong other things, the budget contains ten point
low of . b December ; b distinct themes encompassing a broad agenda for i doubling the incomes of
softening of interest rates the repo farmers in five ears and providing emplo ment and basic infrastructure for
rate stands reduced during the same rural population; ii energising outh education, s ills and obs; iii
Sunil S. Bhandare_Cover Story.indd 17 3/2/2017 1:51:14 PM

Cover Story
strengthening the systems of social security, health care and affordable housing previous ear. rom various
for poor and the underprivileged [iv]infrastructure development for clarifications from spo es persons
enhancing efficienc , productivit and ualit of life; v ensuring growth of the Finance Ministry, it
and stabilit through stronger financial institutions; vi promotion of digital is evident that the budget
econom for speed, accountabilit and transparenc ; vii effective governance has not ta en into account the
and efficient service deliver through people s participation; and viii prudent e pected gains in income ta
fiscal management and improving ta administration that honors the honest. revenues from the “unaccounted
ll these are well meaning and welcome ob ectives, and the budget does see income deposited with ban s” under
to provide considerable substance to each one of these components b wa of demonetization polic . lso, there
resource allocations, some new polic initiatives and programs. ithout going is so far no information about the
into the details of all such features, it ma be worthwhile to discern what could e tent of high denomination notes
reall be the trigger points of investment and growth revival. li el to be e tinguished and the
conse uent potential of an windfall
A Budgetary Arithmetic – a limited qualitative change gains namel , the surplus that could
efore turning to these positives of the budget, and its li el impact on the accrue to the and li el to be
macro economic outloo in , here is a uic re ection on the e transferred to the treasury! Second,
budgetar numbers. rima facie, as brought out in the chart above, the entral in the inance inister relied
ovt.s fiscal profile has been improving. owever, there are grounds for heavily on mopping up surpluses of
s epticism and caution on some of its e parameters, especiall the budgetar s, spectrum fees, etc. witness
structure, which, on receipts side, is dominated b ta revenues and borrowings, the . surge in non ta revenues
and on the e penditure front, b weightiness and lopsided pattern of revenue In contrast, there is going to be
e penditure. hus, ta revenues contribute little over , while capital contraction of as much as .
receipts account for . of total revenues in the budget . Li e wise, in such receipts in . hird,
revenue spending ta es awa . of total e penditure, leaving barel . the Finance Minister has claimed an
for capital e penditure even in . lease see the table below increase of as much as . in
capital spending based on BE of
e omponents o increase in over of . ut
s. illion [Actuals] [RE] [BE] the real increase is much lower in
. evenue eceipts , , , . . fact, almost the same as in the
. . inall , the onl notable
i a evenue , , , . .
ualitative improvement of the
ii on a evenue , , , . . budget is to be found in its sustaining
. apital eceipts , , , . . resolutel the fiscal consolidation
otal eceipts , , , . . efforts.
otal penditure D
Six Triggers of Investment
. evenue penditure , , , . .
D. apital penditure , , , . .
& Growth Revival
a ing an overall view of the
evenue Deficit , , , . . budgetar strateg , we believe that
iscal Deficit , , , . . the budget has definitive triggers to
otes iscal deficit represents e cess of total e penditure over total revenue revive the macro economic outloo
receipts plus recoveries of loans other capital receipts. udget in . i such forces, which
stimate. evised stimate. hold potential for stimulating
aggregate demand both private
Please Note : all the proclamations of the inance about pro ected ta consumption and private investment,
buoyancy and accelerated allocations on capital spending, infrastructure are irst, the fiscal stabilit this
spending, etc. are based oncomparison of of with of would reduce the government s
. ore appropriate is to wor out growth rates either in revenues or in mar et borrowing re uirements
e penditure b comparing of with of which is further to around s. bn. in
what we have done in the above table. as compared to s. bn.
hat transpire from the above budgetar data are the following salient in and s. bn. in
features irst, the budget seems to be more realistic in pro ections of revenues . his ma augur well for the
hus, the budget e pects increase of onl . in the entre s net ta revenue to reduce the repo rate further, if
after accounting for tates share as compared to . growth in the at the same time, the in ation rate
also remains anchored around
Sunil S. Bhandare_Cover Story.indd 18 3/1/2017 11:08:51 AM

Cover Story
during 2017-18. As an aftermath of demonetization, there have already been together with some new ideas of
downward pressures on banks’ lending rates. The current phenomenon of creating BAD Bank or setting up a
excess liquidity with banks [increase in their low cost – CASA deposits] and private asset management company
the absence of any revival in credit growth would also push down lending rates to address bad loans in sectors such
further. Such falling borrowings cost would create demand for housing loans metals, engineering, telecom, textiles,
[and for affordable homes, in particular], retail credit, MSME advances– and all etc. would create an environment
these would cascade into a gradual recovery of overall industrial and corporate for more concerted action on this
sector. front, which would then lead to
strengthening of new and expanding
Second, the much acclaimed thrust on infrastructure expenditure – The corporate investments.
specificall highlights allocation of total capital and developmental
expenditure of Rs.1310 bn. on railways in 2017-18 and various focus areas Concluding Observations
of modernization and expansion of railways, including integrated transport In summing up, the Budget 2017-
solutions. Like-wise, the allocations for the road sector are stepped up to Rs.649 18 unveils a relatively well-balanced
bn. n a possible environment of relative price stabilit an overall in ation strategy, offering opportunities of
rate of 4% on y-o-y basis, the proposed allocations would actually mean an some incremental growth through
increase of 7 to 7.5% in real investment in these sectors. [Please see the table thrust on public spending on
below] infrastructure development;
agriculture and rural sector; corporate
Key Sectors Budgetary 2016-17 2017-18 % increase tax reduction for small companies;
allocations (Rs. Billion) [RE] [BE] focus on job creation in labour-
Infrastructure 3586 3961 10.5 intensive areas of affordable
Of which Transport 2169 2414 11.3 housing; reducing the personal
Agriculture and Rural 1678 1872 11.6 income tax burden for lower income
slab middle-class, thereby providing
Social Sector* 1762 1955 11.0 relief of Rs.155 bn. Its strategic
Please note that the proposed step up in public expenditure is relatively modest framework suggests the under
across all these key sectors, if BE is compared with RE, but becomes noticeable pinnings of stability and
only if BE of 2017-18 is compared with BE of 2016-17. sustainabilit of fiscal and e ternal
sectors. At the same time, there
Third, the increased focus on agriculture and rural economy – apart from are some implicit growth triggers
the increased allocations, the budget has many other measures such as [a] through possible consumption and
expanding the agricultural credit target to Rs.10,000 bn.; [b] ensuring better investment driven virtuous cycles.
ow of credit to small farmers; c raising the corpus of Long term rrigation
Fund and of Micro Irrigation Fund [under NABARD] as well as of Dairy As usual, the budget’s success would
and Infrastructure Development Fund;[d] expansion of coverage of National be determined by implementation
Agricultural Markets [e-NAM]; [e] accelerating pace of rural roads; [f] of various reforms and programs,
increasing allocations for MNREGA and alongside using such funds for including much awaited GST,
productive asset building – farm ponds, etc. All such schemes would help in labour reforms, etc. Prima facie, the
enhancing agriculture and rural incomes, thereby creating incremental rural envisaged economic growth rate of
purchasing power, quite apart from gains arising from increased farm output, if 11.75% in nominal terms in 2017-
the 2017-18 monsoon also turns out be normal. 18 [at current prices], as assumed in
the budget, would be realisable. But
Fourth, there is a sort of package interspersed in various proposals of the it needs to be based on in ation rate
budget which aims at promoting labor-intensive sectors be it affordable of not more than 4% and real GDP
housing, reduction income tax for MSME companies [annual turnover of growth rate of 7.5%. This would
upto Rs.50 crores]. Fifth, the thrust on promotion of digital economy – with require industrial sector to recover
ambitious goals of weeding out corruption and black money; ensuring greater from an estimated low growth rate
formalization of econom ; bringing financial savings into the ban ing s stem; of just about 6% in 2016-17 to at
promotion of financial inclusion; and so on. Lastl , all such efforts of least 8% in 2017-18 and agriculture
investment revival are likely to be strengthened by a set of measures to improve maintaining its 3% annual long-term
the ease of doing business, including scrapping of the FIPB, some trend growth rate and 8 to 8.5%
modifications of domestic transfer pricing provisions, etc. growth rate in the services sector.
Let us all hope for the best from this
But the most critical problem in this area is about resolving the “twin balance budget…and no major disruptions!
sheet” problem. One believes that the Bankruptcy and Insolvency Code 2016
Sunil S. Bhandare_Cover Story.indd 19 3/1/2017 11:08:53 AM

Cover Story
Union Budget 2017- 18

Roadmap for Agriculture
Sharmila Ghoshnath
Author was Consultant Economist in Agricultural Finance Corporation Ltd. as well as
in MCX in Mumbai.
Ms. Sharmila Ghoshnath sharmila.ghoshnath@gmail.com
T he Union Budget proposal for

2017- 18 has been presented by
the finance minister r. run aitle
und, s. crore for setting up a
dedicated Micro- Irrigation Fund
D, radhan antri rishi
Sinchai Yojana’ will be implemented
in mission mode, 28.5 lakh hectares
s. crore earmar ed for
describing “Farmers” as one of the will be brought under irrigation.
Dairy Development Fund under
ten distinct themes to foster the broad mplementation of irrigation
D
agenda of the budget exercise. In his projects under AIBP will be fast
budget speech, the finance minister ssistance to ural trac ed” the finance minister
mentioned, “The Indian farmer has Entrepreneurs for setting up Soil commented in his budget speech.
once again shown his commitment Testing Labs in Krishi Vigyan
and resilience in the current year” and Kendras 5 lakh farm ponds and dugwell in
“agriculture is expected to grow at rainfed areas and 10 lakh compost
4.1% in the current year”. s. crore support to pits for production of organic
D to bringing in o manure will be taken up under
In this backdrop, the current year’s operative banks onto core banking . rogramme for
budget envisaged doubling of the platform sustainable management of
income in farming sector in 5 years otal support to ural and groundwater resources with an
through more reforms in agriculture Agricultural sector raised by 24% to estimated cost of s. crore will
marketing and increased funds for s. . trillion in be implemented through multilateral
insurance and irrigation schemes and funding.
setting of a higher target for farm Farm Credit
credit with a view to tackling distress The budget set a target for disbursing Soil : Soil health card scheme will
in rural ndia. verall, r. aitle said s trillion of farm credit in cover all 14 crore farm holdings by
funding for the rural and agriculture , up from s. trillion targeted last arch . he finance minister
and allied sector would be increased ear. e will ensure ow of credit to said new mini labs for soil testing
b in fiscal to s. underserved areas, like the northeast” will be set up in all 648 Krishi Vigyan
crore. the finance minister said, announcing Kendras (KVKs, farm research
special support of s. crore to institutes) across India. These will be
BUDGET 2017- 18 : cooperative banks to bring them onto run by rural entrepreneurs who will
HIGHLIGHTS FOR the core banking platform. “This will be assisted by the government. It is
AGRICULTURAL SECTOR ensure seamless ow of credit to targeted to ensure 100% coverage
small and marginal farmers who take of all 648 KVKs in the country.
ush to eforms in gricultural
Marketing: New Model Law on credit from cooperative banks,” the
finance minister said. 2000 model retail outlets of Fertiliser
Contract Farming companies will be provided with soil
s. crores for rop armers have also been benefitted and seed testing facilities during the
nsurance, up from s. crore from the 60 day interest wavier ne t ears. n orth ast region,
budgeted in 2016 - 17 announced on st December, organic farming will be promoted
2016 to reduce the aftershocks of through aramparagat rishi i as
Agricultural Credit Disbursement demonetization to the farming o ana and rganic alue hain
target set at s. trillion, up from community. Development.
s. trillion in
dditional s. crore to
Development of Infrastructure Crop Insurance
Irrigation : Apart from creation he budget for the agship crop
D for Long erm rrigation
of long term Irrigation Fund under insurance scheme Pradhan Mantri
Sharmila Ghoshnath_Cover Story.indd 20 3/1/2017 12:16:50 PM

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Fasal Bima Yojana (PMFBY), aiming National Agriculture Market The Critical Evaluation
at protecting farmers from the vagaries (e-NAM) platform. The target is to The Positive Outcome: The credit
of the weather, has been increased expand the coverage of National ratings agency ICRA welcomed the
the allocation from Rs.5,500 crore Agricultural Market from the current expansion in coverage of National
covering 30% of cropped area in 250 markets to 585 APMCs. Agriculture Markets in the Budget,
2016- 17 to Rs. 9,000 crore in 2017- as it will “help fertilisers companies
18 crop insurance scheme,. The The central government will in the medium term through higher
target next year will be to bring 40% urge state governments to delist demand”, according to an analysis
of cropped area under insurance and perishables such as vegetables and report it released on the Union
ta e it to ne t ear. he finance fruits from Agriculture Produce budget 2017. The subsidy hike of
minister said that the government Marketing Committees (APMCs) 6% for the phosphatic and potassic
is likely to incur a cost of Rs.13240 and allow farmers to sell such items segment was also seen as a positive
crore for the PMFBY scheme in directly to consumers to get a better thrust for the manufacturers and
2016-17 (revised estimate). price. At present, farmers are required traders of these fertilisers.
to sell such produce in markets
Support to Allied Activities managed by APMCs. The Apprehension: he finance
Rs. 850 crore has been allocated minister, despite highlighting the
for the four dairying projects e.g., Role of NABARD government’s goal of doubling farm
‘Pashudhan Sanjivani’, ‘Nakul The budget for 2017-18 charged the incomes in five ears, did not spell out
Swasthya Patra’, ‘E- Pashudhan Haat’ apex rural bank, National Bank for a clear strategy to achieve the target
and National Genomic Centre for Agriculture and Rural Development at a time when farm incomes have
indigenous breed, this will create an (NABARD), with implementing plunged due to lower crop prices.
additional milk processing capacity schemes to improve access to
of 500 lakh litres per day. This is irrigation and develop the dairy Farm incomes were severely dented
believed to have a cascading effect sector. in the face of the cash crunch that
as it will lead to the creation of an followed the demonetisation of
additional income of rupees 50, 000 To improve access to irrigation, high-value currency despite record
crore per annum for dairy farmers. the budget provided an additional production of rain-fed kharif
Rs.20000 crore to the corpus for crops in 2016-17 and a rebound in
Reforms in Agricultural the long-term irrigation fund under agriculture growth. It led to a crash
Marketing NABARD. A similar amount was in the prices of vegetables and fruits.
Strengthening the network of allocated last year while setting up Wholesale prices of pulses have also
electronic National Agriculture the fund. The budget also announced fallen below government-set support
Market (e-NAM) is integral to setting up of a dedicated micro- prices following a bumper harvest.
commodity trading, as markets are irrigation fund with a corpus of
the essential route to enhance the Rs.5000 crore under NABARD to The terrible agrarian crisis, in spite
farming income. he finance minister achieve the goal ‘per drop more crop’. of rise in agricultural growth to 4.1%
proposed to set up nified attributed to abundant monsoon
Agricultural Marketing e- Platform Additionally, it announced the setting after reeling under drought for two
to provide a common e- market up of a Dairy Processing and consecutive years, still prevails that
platform for wholesale markets. A Infrastructure Development Fund led to 12,602 farm suicides for 2015,
sum of Rs.75 lakh is also provided to under NABARD with a corpus of the latest year under investigation, up
link the regulated mandis. Rs.8000 crore over 3 years. Initially, by 3% from the previous year as per
the fund will start with a corpus of the estimate of the National Crime
In order to protect the peasantry Records Bureau (NCRB). Sadly, the
Rs.2000 crores.
from the exploitation in the name budget speech did not make mention
of various agreements at the hands of that.
Further, NABARD has also been
of private players, the government
entrusted with bringing the co-
will prepare a model law on contract On Agricultural Credit: It has been
operative banks onto the core
farming and will be circulated among seen that the financial institutions are
banking platform with allocation of
the states for adoption in order to reluctant to provide credit to the small
Rs.1900 crore for the purpose with
help farmers get better value for their and marginal farmers as they fear it
a view to facilitating disbursement
produce. Additionally, Mr. Jaitley would further accumulate their non-
of agricultural credit and extending
reiterated the government’s earlier performing assets. It is a lesser known
other banking facilities to the rural
goal of bringing in more regulated fact that bulk of the farm credit, for
population.
agriculture markets on the electronic which an interest subvention scheme
Sharmila Ghoshnath_Cover Story.indd 21 3/1/2017 11:30:24 AM

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of 3% is provided if paid back in According to Food and Trade Policy round while the average monthly
time, is availed by the agri-business Analysts, the fact remains that consumption expenditure per
companies. agriculture still suffers from income agricultural household was
insecurity. This is supported by the during the same period. For
“As far as the farm loans are fact that Punjab, the food bowl of cultivation - related expenses, the
concerned, the agricultural credit is the country with 98% cultivable area farmer is mostly dependent on loans
mostly netted by large companies. under assured irrigation and high and the NSSO survey revealed that
Also nearly 50% of farmers are productivity matching with the best half of the farm households were
women, who often do not benefit in the world (45 quintals/ hectare neck-deep in debt.
from credit policies as they do have for wheat and 60 quintals/hectare
land titles in their name. Unless land for rice), has lately been witnessing Professor R. Ramakumar, Dean of
titling recognises female ownership a spate of suicides every week. School of Development Studies at
of land for cultivation, half of India’s Farmer suicides had also been Tata Institute of Social Sciences,
farmers cannot claim institutional recorded in Karnataka and Tamil Mumbai, said chasing the goal of
credit,” Professor M. S. Swaminathan, Nadu in the last few years. doubling incomes lacks clarity as to
founder of the M.S. Swaminathan whether it is nominal incomes or
Research Foundation said. On Agricultural Marketing real incomes that are being chased.
nless it is specificall categorised, Reforms: Delisting fruits and Addressing the problem of
the lion’s share of the Rs.10 trillion vegetables and eventually dismantling economic viability of farming in the
earmarked for the purpose of procurement prices is a pre-requisite wake of rising input prices such as for
providing farm loan may eventually for corporate agriculture. After fruits fertilisers, pesticides and seeds and
go to the agri-business corporations and vegetables, it is generally believed stagnating output prices should be of
in place of farmers. More so, no that wheat and rice too will be prime importance.
provision has been made in the taken out of the procurement system.
budget towards debt relief to farmers According to the Shanta Kumar For any real increase in income,
by reducing the interest rates on farm Committee, only 6% farmers get farmers require higher returns
loans which is the need of the hour. the benefit of minimum support for their produce. In a statement
price (MSP). The remaining ones are issued on the Budget,
On Crop Insurance: As the terms dependent on the markets. Prof. M. S. Swaminathan, noted
of the Pradhan Mantri Fasal Bima that it was high time that the
Yojana spell out that the amount However, the apprehension lies if recommendations of the National
of insurance cover depends on the the mar ets were so efficient, wh Commission on Farmers - to provide
premium paid and extent of cover, a 94% of India’s farmers, who do not the minimum price of the total
farmer may not necessarily recover all get the benefit of an procurement cost of production plus 50% - are
losses sustained from crop damage in prices, would be demanding a hike implemented.
case of an eventuality. in along with profit as
recommended by National The budget 2017-18 pitched for more
Harjeet Singh, Global Lead on Commission for Farmers. reforms in agriculture marketing and
Climate Change, Action Aid increased funds for insurance and
International told The Hindu that The General Secretary of the All irrigation schemes, but the major
the government made only a paltry India Kinas Sabah observed that challenge lies in implementation, say
allocation of ₹130 crore to this the new class of rural landlords experts as everything depends on
Fund in the 2017-18 budget for the comprising farm contractors and how well the schemes are executed
National Adaptation Fund for big traders combined with rich on the ground. Senior agricultural
Climate Change when “the country landowners will largel benefit from scientist M Mahadevappa said that
faced unprecedented drought the Budget announcements of higher if at least 70 per cent of the budget
affecting 330 million people last loan allocation and online trading of announced for agricultural sector is
year,”. farm produce,” implemented, it will be a record.
Irrigation: Though it is no denying Conclusion Acknowledgement

that public sector investments for The average monthly income of the Various reports published in:
expanding irrigation and raising crop Indian farm household was netted The Economic Times
productivity are required in any case at about ₹6,426 by the Situation The Mint
but to consider it as the way forward Assessment Survey of Agricultural The Hindu
to increase farmers’ income may Households in its NSS 70th The Indian Express
perhaps be stretching it too far.
Sharmila Ghoshnath_Cover Story.indd 22 3/1/2017 11:30:26 AM

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BUDGET 2017:
ECONOMIC & POLITICAL FALLOUT
NISHANT SHAH
ishant hah is a artner in the a practice of L , focusing on indirect ta es. e is a ualified
lawyer and a Chartered Accountant. His areas of expertise include excise, customs, service tax,
central sales tax, state levies as well as regulations under the Foreign Trade Policy.
Mr. Nishant Shah ishant has been recommended for his e pertise in a b he Legal sia acific .
NishantShah@elp-in.com
MEHFUZ MOLLAH
Regulatory Practice – including Competition Law and Trade Law – Economist/Associate
Mehfuz was responsible for ascertaining legal and economic nuances of various regulatory laws,
including Competition and Trade Laws, like assessment of the economic effect on competition,
calculation of damages and theories of market structure.
Mr. Mehfuz Mollah mehfuzmollah@elp-in.com
A. Introduction to include a greater section of the geo political significance he
T he udget was presented b

the Finance Minister Arun Jaitley
amidst a lot of expectations from
societ into the formal financial
sector. he timing of the udget
was appropriate for the government
represent the emerging economies
of the world where each of the
economies has a potential to reach
the industry and the common man. to roll-out certain measures that superpower status. Quite naturally the
Globally, the international market has would support the objectives of competition amongst nations
started to show signs of slow-down demonetisation. is uite fierce each tr ing to
because of the uncertainties resulting create a leadership role for itself. For
from the election results in the In the present article I have attempted example, each of India, China and
United States where Donald to evaluate the udget based on South Africa contended to have the
Trump won a mandate based on a the existing economic and political headquarters of the newly established
campaign which, arguably focussed contexts. development ban for , called
on anti-trade rhetoric; and the ew Development an , at their
United Kingdom deciding to leave B. Providing Support to countr ; with finall the hinese cit
the European Union. Quite naturally, Businesses India and BRICS of Shanghai securing this feat.
the industr e pected that the udget As discussed above, there was a
would provide for a conducive legitimate expectation from the The chart below compares the gross
and sustaining economic space for industr that the udget would capital formation (which can be
businesses to ourish in such a provide for a supporting environment treated as a proxy for investment)
geo-political environment. for the Indian industries to operate amongst nations. t can be
and compete with global giants. seen that the gross capital formation
Domestically, India undertook a ccording to the orld an of most nations have become
reformation of sort when on Doing usiness eport ndia ran s stagnant from onward i.e. post
ovember , the government globall in terms of the overall global recession of when the
announced that currency notes of ease of doing business. For some of same for India has been on a steady
denomination INR 500 and INR the parameters India fared poorly drop. It can be argued that without
would no longer be valid as legal compared to other nations. any stimulus to the sector Indian
tender. The stated objectives of this manufacturers would lose its edge
exercise were to curb the menace omparing ndia to other in the global market, especially
of black money in the economy and nation also has a very important compared to the other
nations.
Dimple Chainani_Cover Story.indd 23 3/1/2017 11:36:30 AM

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Figure 1: BRICS - Gross Capital Formation (% of GDP) as Budget 2017
proxy for Investment n order to create an environment
conducive for businesses, the
government had rolled out various
schemes li e a e in ndia, tart up
ndia and further easing of entr of
foreign investment
1. Make in India Initiative

he a e in ndia has been one
of the agship campaigns of the
government from its launch in .
t primaril aimed at reviving the
growth of the manufacturing sector
Date Source: World Bank Database in ndia. o provide further impetus
to this campaign, the following
The Curious Case of Divergence of Trend of Investment and Foreign e policies were announced in the
Direct Investment udget
Since the liberalisation of Indian economy in 1991 there has been a steady • educed corporate income
increase in the in ow of foreign direct investment into ndia till the global ta rate of for all domestic
financial crisis of . he figure below reveals that the trend in gross fi ed companies with turnover up to
capital which is a pro to investment has been in s nc with the trend in crores;
oreign Direct nvestment D ” . owever, from onwards we see that
even though the D in ow of D into ndia has increased, the same • ncrease in time limit for carr
has not been re ected in ndia s gross capital formation of D , which forward of inimum lternate a
has in fact decreased in the same time period. his is a sign that there are other ” credit from to ears;
significant contributors to the growth of gross fi ed capital that is hindering the
recover of the same. • eduction in applicable ustoms
dut on various inputs and raw
i re o arin trends of India s I in o and ross i ed materials such as L , parts for use
Capital in manufacture of L D lights, nic el
etc. so as to support domestic value
addition
• ncreased allocation of
. crores to the odified pecial
ncentive ac age cheme
and lectronics Development und
D to ma e ndia a global hub
for electronics manufacturing
• mplementation of a special
scheme for leather and footwear
industries, similar to the alread
launched scheme for the te tile
sector, to incentivize these labour
intensive industries.
Source: World Bank Database 2. Start-up India

tart up ndia has been an
important initiative of the

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Government of India to support 3. Foreign Direct Investment
and nurture budding entrepreneurs In order to address further ease the movement of capital, the Budget proposed
in the country. In pursuance of this the following:
campaign, the Budget provided for
the following support to start-ups: • he oreign nvestment romotion oard ” , which offers a single
window clearance for applications on D in ndia that are under the approval
• nli e other business entities, route, is proposed to be abolished in 2017-18
start-ups would be entitled to carry
forward business losses even if there • urther liberalisation of the consolidated D polic is under consideration
is no continuous holding of 51% and announcements will be made in due course.
of voting rights, provided that the
holding of the original promoters C. Supporting the Objectives of Demonetisation
continues Economic Situation Pre-Demonetisation
he udget has assumed significant importance as it has been presented
• he profit lin ed deduction after the historic movement of demonetisation of high value notes. he
granted under Section 80-IAC of the overnment s move came in the wa e of multiple issues within ndia s cash
ct can be claimed in a bloc of dependent econom , ranging from accumulation of blac mone , corruption,
three consecutive years out of the counterfeiting, etc. Additionally very few Indians had access to the formal
first seven ears instead of the earlier ban ing sector. he chart below shows that of all the nations ndia has
requirement of claiming such the second lowest domestic credit provided b financial sector as percent of
deduction within three consecutive D .
ears of the first five ears .
i re I o estic credit ro ided nancia sector of
Source: International Monetary Fund, International Financial Statistics and data files, and World Bank and OECD GDP estimates.
nother issue that the demonetisation e ercise aimed at addressing was to e pand ndia s low ta base. he chart
below reveals that ndia and hina have almost a similar and the lowest trend in the ta revenue as a percent of D .
owever, this has to be conte tualised to the economic realities of hina, which does not follow the same mar et based
philosophy of India. Evidently, there is quite a scope to improve the tax base and it was the purpose of demonetisation
to address this deficienc .

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Figure 4: BRICS - Tax Revenue (as % of GDP)
Source: International Monetary Fund, Go ernment Finance Statistics ear ook and data files, and World Bank and OECD GDP estimates
Macroeconomic Impact of by India in the medium to long-term economic environment for Indian
Demonetisation and any drop in economic activity firms. hrough the various measures,
Even though the macroeconomic will only be transitory in nature – the the Budget did address this so that
impact of such a move is yet to normal D in the long run will ndian firms, especiall the start up,
be properly determined, there are be “bigger, cleaner and real”. The are in a position to compete globally.
quite divergent views about the inance inister was confident However, one of the most anticipated
expected impact. In light of the move to state that the effects of events in India - the roll out of the
the Asian Development Bank revised demonetisation will not spill over into oods and ervices a ” was
its estimate of growth projections for the next year. curiously missing from the Budget.
India from 7.4 to 7 % and the IMF The Budget failed to give a clear path
from 7.6 to 6.6%. Others believe that According to the Finance Minister, and dateline for the introduction of
such adverse impact on the economy the availability of surplus liquidity . f it had been introduced in
is only temporary and the economy in the banking sector due to this Budget, it had the potential of
will not only recover very soon but demonetisation has already resulted bringing about great economic and
will also reap the benefit of a larger in reduced lending rates offered by political benefits.
tax base. the banks. Additionally, the Finance
Minister has laid down the following On the other hand, the Budget was
tax proposals to address the significant because it was presented
Budget 2017 objectives of demonetisation: just after the bold exercise of
The Finance Minister in his Budget
• estricting cash donations demonetisation which had a stated
Speech addressed this topic head on
and measures to discourage cash objective to curb out black money
and reiterated that the objectives of
transactions; and introduce major sections of the
demonetisation are as below:
• Disallowance of depreciation Indian population to the formal
• urbing ta evasion and the financial institutions. he various
under Section 32 and capital
parallel economy; provisions in the Budget supported
expenditure under Section 35AD on
• limination of corruption, blac this objective of the government.
cash payment;
money and counterfeit currency; he uestion of final impact on the
• easures to promote digital
• reater formalisation of the macroeconomic variable is still open;
payments in case of small
economy; however, it is expected that the long
unorganized businesses
• urplus li uidit in the ban ing term economic benefits would far
sector. overshadow the short term losses.
D. Conclusion
The Finance Minister, reiterating The 2017 Budget was presented at
the assurances given by the Prime a very important juncture of global Authors:
geo-political situation which called Nishant Shah – Partner
Minister Mr. Narendra Modi in the
for the government to provide a Mehfuz Mollah – Associate Manager
a a abha, clarified that the benefits
of demonetisation would be reaped very conducive and sustaining

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Union Budget 2017-18:

A Gender Analysis
Prof. Vibhuti Patel
Dr. Vibhuti Patel is Professor & Head, Department of Economics,
SNDT Women’s University, Mumbai-20
Prof. Vibhuti Patel vibhuti.np@gmail.com
G ender Responsive Budgeting

(GRB) Women and girls face
various forms of vulnerability
and transform their situation. GRB ensures that overall policy/programme
planning, budgeting; implementation and auditing continuum are gender
responsive. The idea behind GRB is not about literally dividing funds in a
throughout the life cycle. They may fift fift ratio among men and women.
face discrimination before or after
birth; violence,harassment or abuse; GRB is about bringing a gender perspective in policy making at different
neglect due to dependence and levels. For example, the recent schemes like Digital India are noteworthy but
lack of access to resources; social lac specific focus on digital empowerment of girls and women given the
prejudice; and exploitation – whether gender inequality in society. At grass root level, often women with low or no
economic, political, social or religious. literacy levels are left out in technological shifts which become important part
They are vulnerable to exploitation of daily life in society. Likewise, there is scope to integrate safety of women
and discrimination regardless of as a ma or concern in agship centrall sponsored schemes such as
where they are positioned on the Jawaharlal Nehru Urban Renewal Mission (JNNURM), PMGSY, etc. Under
economic and social spectrum. Smart Cities Town planners, policy makers and budget experts need to do
Additionally, their vulnerability gender budgeting to ensure women-friendly civic infrastructure- water, sanitation,
increases significantl if the are health care, safe transport, public toilets, help lines, skill development for crisis
poor, socially disadvantaged or live management and, safe transport and safety at work place.
in a backward or remote area. GRB
is a widely accepted strategy that In brief, it needs to be recognized that women’s issues do not have to be seen as
has been employed across more the concerns of the Department of Women and Child Development (DWCD)
than 100 countries to address this and Social Welfare (SW) Departments alone. There is a need to recognize that
vulnerabilities. GRB is a tool for women are contributors to and recipients of services provided by different
gender mainstreaming. It uses the departments like Health, Education, Home, Tribal, Public Works, RDD,
Budget as an entry point to apply Housing, Social Justice, etc. and that they have different needs. Policies have to
a gender lens to the entire policy be thus designed and financed accordingl to create ma imum benefits to all.
process. It is concerned with gender
sensitive formulation of legislation, Have Gender Commitments translated into Financial
policies, plans, programmes and Commitments?
schemes; allocation and collection
he , first presented in nion udget , aims to capture
of resources; implementation and
budgetary resources earmarked for women and girls by Union ministries and
execution; monitoring, review, audit
departments. The Statement is presented in two parts: Part A enlists schemes
and impact assessment of
and programmes meant entirel for the benefit of women and girls; while art
programmes and schemes; and
reports schemes in which at least percent of the funds benefit women
follow-up corrective action to
and girls.
address gender disparities. GRB is
not just a one-time activity. It is a
continuous process that must be
Budgetary Outlays for Ministry of Women and Child
applied to all levels
Development
and stages of the policy MWCD is the nodal ministry to formulate and implement plans, policies and
process. It recognizes that the Budget programmes for the empowerment of women. There has not been increase in
is a powerful tool that can reduce the financial allocation in real terms due to in ation during the current decade
the vulnerability of women and girls during the budget years 2012-13 and 2017-18 as can be seen in the tale below:
Vibhuti Patel_Cover Story.indd 27 3/1/2017 3:08:24 PM

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Year Total Expenditure of Ministry of MG NAREGA-Rs. 48000 crores,
Women and Child Development Women- 55%
(MWCD) Rs. (in cores) MWCD-27 % increase, Rs. 22095
2012-13 17,036 crores
2013-14 18,037 Rural sanitation 42 % increase on
2014 and 60 % increase in 2017-18
2014-15 18,539
Adhar based smart cards for
2015-16 17249
senior citizens
2016-=17 Budget Estimates 17,408 PM Mudra Yojana 2.44 lakh
2016-17 Revised Estimates 17,640 crores
2017-18 budget Estimates 22,095 Stand up India for women
entrepreneurs
The budgetary outlays to MWCD have increased from Rs. 17,408 in 2016-17 SWAYAM platform for digital
(BE) to Rs. 22,095 crores in 2017-18 (BE). However, the bulk of MWCD’s
learning-students, girls
allocations are for the ICDS programme, which itself requires higher
allocations as observed by the Department related Parliamentary Standing Model shops &Establishment Act
Committee on Human Resource Development, 2016 (Report No.278) which PM Kaushalya Kendra in 600
stated “… Ministry should put in efforts to make sure that the shortage of districts
funds does not become a hindrance in implementing the scheme and also in Beti Bachao, Beti Padhao- Rs. 200
enhancing the outreach of the scheme so as to include maximum number of crores
beneficiaries”.
Child Welfare :
here has been a notable increase in the allocations to the aternit enefit
Programme (formerly known as Indira Gandhi Matritva Sahayog Yojana) Creche (Rs. 200 crores),
from Rs. 400 crores in 2016-17 (BE) to Rs. 2,700 crores in 2017-18 (BE). This Child Protection (Rs. 248
allocation is close to GOI’s estimate of a requirement of Rs. 7,348 crores Crores),
for the scheme for the period 2017-18 to 2019-20 to be borne by the Union Child Labour (Rs. 2 crores),
Government. However, as per the estimates of Standing Committee on
Food ,Consumer Affairs and Public Distribution (2012-13), the total scheme Anganwadi (Rs. 15245.19
e penditure towards maternit benefits to . crores pregnant and lactating crores),
women works out to be Rs. 14,512 crores per annum (to be borne by Centre National Nutrition Mission
and states). Going by this estimate, this allocation seems to fall short of the (Rs. 1500 crores),
required funds to universalise the scheme. aternit enefits s.
crores)
Other schemes, such as those for addressing the needs of women in distress Adolescent Girls (Rs. 460 crores)
such as Swadhar Griha, and One Stop Crisis Centres have witnessed marginal
National Mission for Empower-
increases, which are inadequate to ensure both adequate coverage and quality
of services. As of July 2016, 17 One Stop Centres were operational in the ment of Women Rs. 70 crores
country through the funds provided by MWCD. It was also proposed to expand One Stop Crisis Centre Rs. 90
the scheme to 150 additional districts during 2016-17. However, this does not crores
seem to have taken place, taking into account the Revised Estimates of 2016- STEP for skill training Rs. 40
17 for the scheme. (Rajya Sabha Un-starred Question no. 1327 answered on crores
28 July 2016). Given the criticality of the issue, it is imperative that the Union Swadhar Rs. 100 crores
Government continues to supplement the efforts of states in this domain.
Working Women’s Hostel Rs. 50
The Rajiv Gandhi Scheme for Empowerment of Adolescent Girls-SABLA, crores
launched in 2010 continues to be implemented in pilot phase.
• he allocations to inistr of
Fund Allocation for Women and Children in Union Budget Women and Child Development have
2017-18 increased from Rs.17, 408 crores in
2016-17 (BE) to Rs. 22,095 crores in
Mahila Shakti Kendra in villages 500 crores
2017-18 (BE).
aternit enefits s. to women undergoing institutional deliveries
PM Gram AwasYojana-title in the name of woman

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• otal magnitude of the ender nion erritories have reported retrospectivel , rather than
udget tatement is s. , , their interventions in the identif ing the gender based
crores in as compared this ear. he Department of disadvantages in their respective
to s. , crores in . elecommunications, Department sectors of concern and the budgetar
of conomic ffairs, inistr of resources earmar ed to address these
• n allocation of s. , crores verseas ndian ffairs, and inistr specific challenges. ome changes in
in to aternit enefit of ancha ati a have not reported reporting of select schemes under
rogramme formerl nown as their programmes in the this certain ministries such as inistr of
ndira andhi atritva aha og ear, while the inistr of etroleum ealth and amil elfare, inistr
o ana . and atural as has initiated of ribal ffairs and Department
reporting in the . of griculture, ooperation and
• ahila ha ti endras with an armer s elfare have been observed.
allocation of s. crores to be set he total allocations in art of the owever, the rationale underl ing
up at village level in la h D are s. , . crores in these changes is not clear as the
nganwadi entres. his will provide , which as a proportion of does not provide an ustification
one stop convergent support services the nion udget, shows an increase rationale for reporting of schemes
for empowering rural women with from the previous ears. b departments ministries in the
opportunities for s ill development, statement.
emplo ment, digital literac , health he increase in allocations in art
and nutrition. of the this ear is primaril nal sis of also highlights
on account of increased allocations that important ministries continue
• n action plan to reduce nfant reported b D, Department to be outside the ambit of ender
ortalit ate from in to of ural Development for ural esponsive udgeting . or
b and aternal ortalit ate radhan antri was o ana and instance, the lac of safe sanitation
from in to b inistr of etroleum and atural facilities is recognized to be closel
has been announced, though as for L connections to poor lin ed to the incidence of violence
details are still awaited. households . t ma , however, be against women. owever, the
noted that radhan antri was inistr of Drin ing ater and
• nder radhan antri udra o ana is not a scheme meant onl anitation is et to adopt .
o ana, it is proposed to double the for women, hence its inclusion in Li ewise, other important ministries
lending target of and set it art of the is uestionable. such as inistr of rban
at s. . la h crores. riorit will he scheme for L connections Development, inistr of Law and
be given to women, besides Dalits, to poor households, is a welcome ustice and inistr of ourism have
divasis, bac ward classes and intervention as it serves to reduce not et adopted .
minorities. women s drudger and addresses
health concerns associated with the Operationalisation of
he persistence of gender ine ualit use of chulhas; however, its reporting Nirbhaya Fund
re ected in socio economic as a scheme benefiting women
indicators and the increasing e clusivel also inadvertentl he irbha a und, introduced in
incidence of violence against women endorses the gender stereot pe that nion udget is a e nion
in the countr underscores the domestic duties li e coo ing are overnment intervention that aims
need for substantive measures to be primaril the responsibilit of to enhance the safet and securit
implemented b the government. women. of women in the countr . he total
omen e perience distinct magnitude of the corpus is s. ,
disadvantages and budgets are an llocations in art of the have crores. s of anuar , si teen
important polic instrument to increased from s. , crores in proposals amounting to s. ,
address these. to s. , crores crores have been appraised and
in . owever, there recommended b the mpowered
What does the Gender Budget do not seem to be an significant ommittee of fficers, an inter
tate ent re ect improvements in the reporting b ministerial committee that appraises
ministries departments in art and recommends various proposals
he overall magnitude of the of the . ost departments pro ects proposed b different
in is s. , , ministries continue to report a at inistries Depar tments tates
crores, an increase from s. , percent or percent of the under the und.
crores in . total of total allocations in the
ministries and departments and

Cover Story
From the information provided in the
Union Budget documents, it could be
F ORM IV ( Se e Ru l e 8 )
F ORM
F ORM IV IV ( Se( See e RuRul e l e 8 ) 8 )
interpreted that the amounts utilized Statement about ownership and other particulars about
under the Nirbhaya Fund lacks Statement
Statementabout aboutownership
ownershipand andother
otherparticulars
particularsabout
about
clarity. The government must make periodical entitled ‘ M AHARASHRA EC ONOM IC
periodical
periodical entitled entitled ‘ M ‘ AHARASHRA
M AHARASHRA EC ECONOM ONOMIC IC
information on the allocations and DEV EL OPM ENT C OUNC IL , M ONTHL Y EC ONOM IC
utilisation of interventions under the DEVDEVEL ELOPMOPMENT
ENT C OUNCC OUNCIL , IL , M ONTHL
M ONTHLY Y EC ECONOM
DIG EST’ as required to be published in the first issue every
ONOMIC IC
Fund available in the public domain. DIGDIGEST’
EST’asas required
required to to
bebe published
published
in in
thethe
first
first
issue
issue
every
every
Also, important proposals, such as year after the last day of February
year
year after
after
thethe
last
last
day
dayof of
February
February
the Central Victim Compensation
Fund, proposed under the Nirbhaya
1. Place of publication : Mumbai
Fund, do not seem to have been 1. 1.Place
Place
of of
publication
publication : : Mumbai
Mumbai
introduced in Union Budget 2017-18. 2. Periodicity of its publication : Monthly
2. 2.Periodicity
Periodicity
of of
itsits
publication
publication : : Monthly
Monthly
3. Printer’s Name : Suresh A. Ghorpade
The hurdles in the operationalisation 3. 3.Printer’s
Printer’s
Name
Name : : Suresh
Suresh
A. A.
Ghorpade
Ghorpade
of Nirbhaya Fund have affected Whether Citizen of India ? : Yes
its effective utilisation. The low Whether
Whether Citizen
Citizen of of
India
India
? ? : : Yes
Yes
Address : Maharashtra Economic
utilisation of the Fund indicates the Address
Address : : Development
Maharashtra
MaharashtraEconomic
Economic
Council
lack of priority towards the issue Development
Development Council
Council
Y.B. Chavan Centre,
of women’s safety and security. The Y.B.
Y.B.
Chavan
NarimanChavanCentre,
Point, Centre,
implementation of this Fund Nariman
Nariman
Mumbai –Point,
Point,
400 021.
presented an opportunity to institute Mumbai
Mumbai– 400
– 400021.
021.
a comprehensive set of measures 4. Publisher’s Name : Suresh A. Ghorpade
by appropriate departments and 4. 4.Publisher’s
Publisher’s
Name
Name : : Suresh
Suresh
A. A.
Ghorpade
Ghorpade
Whether Citizen of India ? : Yes
ministries. Given government’s Whether
WhetherCitizen
Citizen
of of
India
India
? ? : : Yes
Yes
stated commitment towards Address : Maharashtra Economic
Address
Maharashtra
MaharashtraEconomic
Economic
enhancing women’s safety in the Council
Development
Development Council
Council
country, it is imperative to undertake Y.B. Chavan Centre,
Y.B.
Y.B.
Chavan
ChavanCentre,
Centre,
steps to ensure optimal utilisation of Nariman Point,
Nariman
Nariman
–Point,
Point,
the Fund. Mumbai 400 021.
Mumbai
Mumbai– 400
– 400021.
021.
5. Editor’s Name : Suresh A. Ghorpade
Government of India (GoI) adopted 5. 5.Editor’s
Editor’s
Name
Name : : Suresh
Suresh
A. A.
Ghorpade
Ghorpade
“Budgeting for Gender Equity” as Whether Citizen of India ? : Yes
Whether
Whether Citizen
Citizen
of of
India
India
? ? : : Yes
Yes
a mission statement in 2004–05; Address : Maharashtra Economic
which was followed shortly by the Address
Maharashtra
MaharashtraEconomic
Economic
Council
production of the first gender Development
Development Council
Council
Y.B. Chavan Centre,
budget statement (GBS) in 2005–06. Y.B.
Y.B.
Chavan
Point, Centre,
In the past decade, the work around Nariman
Nariman
Mumbai –Point,
Point,
400 021.
GRB has deepened at central as well Mumbai
Mumbai– 400
– 400021.
021.
as state levels in India. As per the 6. Name and Address of :
Maharashtra Economic
6. 6.Individuals
Name Name andand Address
Address ownofthe of :
: Development
Maharashtra
MaharashtraEconomic
Economic
records of the Ministry of Women who Council
Individuals
Individuals who who own own Development
thetheDevelopment Council
Council
and Child Development (MWCD) periodical and partners and
Y.B. Chavan Centre,
periodical
periodical and and partners
partners andand
nine states have officiall adopted shareholders holding more
Y.B.
Y.B.
Chavan
Point, Centre,
shareholders
shareholders holding
holding more
more
GRB in some form or the other. than one percent of the Nariman
Nariman
Mumbai –Point,
Point,
400 021
than than one onepercent
percent of of thethe
owever, unofficial estimates point paid-up capital Mumbai
Mumbai– 400
– 400021
021
paid-up
paid-up capital
capital
to a much higher number. Also, about
57 ministries and departments at I, Su r e s h A. G h o r p a d e hereby declare that the particulars
I, I,Su Sur e s r e h s h A. A.G h G o h r op ra p d a e d e hereby
herebydeclare
declarethat
thatthetheparticulars
particulars
the central government levels have given above are true to the best of my knowledge and belief.
established these cells. given
given above above arearetrue true to to thethe best
best
of of
mymyknowledge
knowledge andandbelief.
belief.
Sd/-
Sd/-
Sd/-
Suresh A. Ghorpade
Suresh
SureshA.A.
Ghorpade
Ghorpade
Date : 28.02.2016 Signature of Publisher
Date
Date: 28.02.2016
: 28.02.2016 Signature
Signature
of of
Publisher
Publisher

Cover Story
BUDGET FOCUSESON GROWTHAND

FISCAL DISCIPLINE DESPITE FOR
MIDABLE CHALLENGES
Kiran Nanda
Author & Project Leader of number of national and international assignments.
Currently working as a free-lance Economist. Earlier, IMC- Director, Indian Merchant’s
Ms. Kiran Nanda Chamber’s research wing- “Economic Research & Training Foundation” (IMC-ERTF)
kironnanda@gmail.com
T he work-in-progress Budget
2017-18 presentedon
1st February 2017 is a progressive
ofglobal D ows having slumped
13% last year partlydue to a wave of
anti-globalisation.
Against the above, Budget
re ects India s
buoyant ambitions-
and inclusive blueprint driven by
structural reforms to facilitate • ndia s entrepreneurial energ is • owardsma ing ndia as illed
the economy to re-invent its core unparalleled, which needs to bescaled nation that is continuously learning
strength and realize its full potential. up. Satya Nadella, Microsoft Chief is
According to Dr. Surjit Singh Bhalla, enthused by it. • roviding omes for all b
this Budget is probably the most
brilliant economic and political Some negatives too - • nsuring electricit to ever home
document since the path-
• D growth revised downwards.
breaking budget of 1991. Effective • uilding a low cost econom and
inance inistr finall gave an
implementation of budgetary bringing down transaction costs to
estimate of impact of
provisions will be the key to justify benefit ever citizen as well as small
demonetization on growth for FY17.
this statement. Budget ought to be and large business.
ominal D will be , about
read along with Economic Survey.
basis points lower than the first
advance estimate of D made • chieving moderate in ation
Positives on the eve of Budget
by CSO. This disclosure is tucked
• ndia getting ounger a uni ue • Doubling armers ncomes
in the Medium Term Fiscal Policy
demographic advantage
statement. Short term revenue
outlook of a number of corporates • ecoming a ta compliant
• onsumers becoming more economy
became cloudy because of note ban.
demanding
• ontinuing bad loan crisis with • idening of the ta base
• overnance improving but at a
NPAs shooting up by 135% from
slow pace • Lowering the ta rates
Rs 261,843 crore in last two years,
despite RBI announcing a host of
• conom becoming digital but • a ing ndia a clean countr
restructuring schemes.
long way to go
• mplo ment growth s ewed and • ac ling blac mone and
• uch progress made on corruption
not keeping pace with growth. IT
engineers are almost staring at a
• ndia considered a priorit among The Budget has aptly summed up the
future of no jobs
large s. ew D in ow record above agenda of the government for
possible in 2016-17 despite India —to Transform, Energise and
• Disparities have been
temporary growth hiccups ascribed Clean. In other words, the Budget
strengthening, not weakening, over
to the currency swap programme. focus has been on placing India on a
time. Less developed States are
This underscores India’s status as sustainable high growth trajectory.
falling behind the richer ones instead
an island of economic stability,
of catching up
especially against the backdrop
Kiran Nanda_Cover Story.indd 31 3/1/2017 3:13:07 PM

Cover Story
Economic and Political to move to 3% the next year without assured. We propose to create an
a o ts i ni cant increasing government’s debt/ integrated public sector ‘oil major’
GDP ratio. This levelmay not lead which will be able to match the
Prominent among these ares-- to rise in interest rate and is not performance of international and
Big boost providedto Rural India, in ationar . hat is noteworth is domestic private sector oil and gas
especially rural infrastructure. that the genuineness and conservative companies.
Spending on rural infrastructure nature of fiscal numbers have been
increased to improve quality of life widely appreciated. This has provided Other positives are--Alignment
in villages. Proposals include higher a big boost to India’s global credit with Global Best Practices,
allocation for rural roads, housing, rating. But the states’ FD has been OECD Guidelines and BEPS
electrification, irrigation and rising. FRBM is in favour of recommendations and Ensuring
employment. modification of ct . Revenue Accountability,
FRBM report has been submitted and Probity, Information and
Infrastructure in general given its proposals are being considered. Digitization (RAPID)
immense support FRBM has mooted Fiscal Council. Budget provides for enforcing of
With an allocation of Rs 3961 trn greater accountabilit of officers
for infra as a whole, Budget has GST of a Department for specific act of
reinforced its emphasis on the sector. Budget has eased movement towards commissionand omission.
This year also marked the merger GST. The constitutionally
of the Railway Budget with the empowered GST Council body Sustainability undertone of the
General Budget. A Railway Safety has entered the last lap of its key Budget indicates that the government
Fund has been set up with a corpus legislative business. Ithas formally has long term vision for the Indian
of s , , cr over five ears. approved a Bill for compensating the economy. Elections in the next few
Infrastructure status to low cost state governments for any revenue days will be followed by large state
housing is a good move.12% boost loss they might have to suffer in the elections in November 2018 and
in budgetary allocation is expected to first five ears in the regime. n national elections scheduled for
give the highways sector a boost. the long path to introducing GST, the 2019. Likely higher than expected tax
Government was till now focused on revenue and GDP growth,
Promoted Ease of Doing Business State governments and negotiating government intendsto complete
Budget has proposed amendmentsin their claims for compensation that it tax reforms for individuals and
the IT Act which shall promote ease appeared to have forgotten that India corporates, in next year’s budget.
of doingbusiness in India. has seven Union Territories that also
need to come on board. Some Concerns emanating
Making India a skilled nation from Budget are—
India faces twin challenges--apart Health boost provided
Given that government health • ear of ta terrorism and no word
from education for all, skill
spending in India has historically on corporate tax cut.
development has also become a
formidable challenge. Budget has been low, making major allocation
for the Health ministry, the highest • wo paras towards a transparent
built on the idea that India’s skill
ever growth in nominal terms in the method of funding political parties in
development challenge can
last 15 years,represents big growth budget created quite a stir. Maximum
essentially be met by government
though expectations were still higher. amount of cash donation that a
efforts. But this is not true.
In terms of any indicator of political party can receive will be
Government-driven systems are
government health spending — as a Rs 2,000 from one person.
supply-driven, without regard to skill
share of D . per cent in Electoral bonds have been proposed.
demand. Till date, less than 5% of
or as a share in total government Black money is a multifaceted one in
India’s workforce of 500 mn has
spending . per cent in politics, requires a holistic approach
received any form of formal
or as a per capita spending less than and not piecemeal measures as in this
vocational training. The fact is that12
in ndia ran s poor in budget. According to a recent article
mn are number of people who enter
comparison to other countries. by Jagdeep S Chhokar in EPW, “the
India’s workforce each year.
only solution seems to be for civil
Consolidating Oil Sector : society, the media and the judiciary
Sound Fiscal Credentials
Forming An Integrated Oil Co. to work in synchrony to achieve this.
presented
In a welcome move, the restructuring Al these three are also dispersed in
udget provides for a fiscal deficit
in the oil and gas sector has been themselves and there is no formal
target of 3.2% for FY18, promising
way for them to work together.”

Cover Story
• mplementation of the review in eptember. Lots need to be done to increase ndia s e ports. nl
demonetization e ercise has left a lot there is a scheme proposed for building e port infra at state level. t is positive
to be desired. he government seems that authorities seem to be thin ing ahead. t is reported that ndia is li el to
to be framing rules as it goes along have climate change budgetar supplement from ne t ear. udicial reforms are
and that is never a good thing. in the ma ing. s view is that efficient governance was needed in order to
reduce the burden on udiciar .
• s issue has become a serious
issue despite numerous efforts made. ver e panding bundle of uncertainties domestic and global portends the
overnment has started pulling up to be a ver challenging ear. gainst this, the econom s response to the
ban ers for woes. budget would be interesting to watch.
n initiative that has been mooted n ndia s bullishness im al er sa s he base case growth rate for ndia
of late is the formation of a public is but the potential is . hat is enough to ma e me bu ndia for the
sector asset rehabilitation agenc ne t ears.” ith government s goal being reform to transform”, realization
with the acron m of . his is of ndia s potential is possible.
similar to the idea of a bad ban
which seems to be in the offing.
he is of the view that ndia

ban ing bailout cost is manageable
In sum :
verall, the udget is a welcome
brea from the choppiness around
with no ma or negative surprises,
which b itself buo ed the mar ets.
mid volatilit , the short term trend
has been up for both indices. t has
focused on boosting infrastructure
spending and pushing consumption
while committing to fiscal
consolidation. n man wa s, the
s stem has been straightened to
ensure better investment climate
for investors. overnment seems
to be determined not to be swerved
from the path of transforming the
nation b underta ing wide spread
reforms. here is a neutral stand on
government revenues as far as the
indirect ta collections are concerned.
ll e es are set on the introduction
of the final laws to pave wa
for the implementation of from
ul . he is radicall different
game changer move. s a short time
window is available for its
implementation, the penal
provisions should not be harsh at
least in the initial couple of ears.
urbing c ber crimes has become
essential. porters, largel
ignoredin the udget, can hope for
some incentives and thrust in the
mid term foreign trade polic

Cover Story
BUDGET 2017 :
A CASE OF NOT MUCH
Dr. Tulsi Jayakumar FISCAL PRUDENCE
Dr. Tulsi Jayakumar Dr. R. K. Pattnaik
tulsi.jayakumar@spjimr.org ranjitkpattnaik@gmail.com
* The authors are Professors of Economics at the S.P. Jain Institute of

Management & Research. Views are personal
Dr. R. K. Pattnaik
B udget 2017-18 presented on

February 1, 2017 was presented
as the offering of a reformist
prudence is important since it results
in fiscal sustainabilit , fiscal
transparency, budget integrity and
• mall savings coming from small
investors rather than public sector
institutional investors
government, having enacted key above all, durable fiscal space. • eduction in the magnitude,
transformational reforms including This was also result in functional duration and persistence of
passage of the Constitution autonomy to the RBI to conduct maintenance of government’s cash
Amendment Bill for GST and monetary policy. balances with the RBI
the progress for its introduction,
Demonetisation of high PRUDENT FISCAL GOVERNMENT STANCE
denomination bank notes, Enactment MANAGEMENT n the conte t of fiscal prudence, the
of the Insolvency and Bankruptcy The Union Budget 2017-18 when
Code; amendment to the RBI Act INDICATORS perused in conjunction with the
for in ation targeting and enactment It is important to discuss prudence Economic Survey, speaks of lesser
of the Aadhar bill for disbursement in the conte t of fiscal management, recognition of such prudence in
of financial subsidies and benefits. particularl in a rule based fiscal advanced economies. This is
The budget itself contained 3 major policy regime (FRBM). Fiscal attributed to monetary policy having
reforms. One, the budget’s Prudence does not refer merely to a limited role in achieving the macro
presentation had been advanced to a reduction in fiscal deficit, as is -economic objective of growth and
1st February to enable the Ministries popularly perceived. Rather, it refers stability in the presence of zero lower
to operationalize allactivities from to the adherence and achievement of bounds, and monetary easing having
the commencement of the financial the following: run its course in such economies.
year. Two, there was a mergerof the • ero revenue deficit Further, both documents refer to the
Railways Budget with the General • igh capital outla s based on adoption of a fiscal consolidation
udget and hree, the classification commercial principles (i.e. based stance in pursuance of fiscal
of expenditure into plan and non- on the rate of return on investment prudence.
plan was removed in order to to being higher than the borrowing
facilitate a holistic view of costs) In keeping with this stance, Budget
allocations for sectors and ministries. • ocus on gross mar et borrowings 2017-18 announced the following
Yet, any budget statement is actually by the government, rather than the steps towards prudent fiscal
the enunciation of a government’s net market borrowings (the former management:
fiscal polic and to the e tent refers to net market borrowings +
repayments) • tepped up allocation for apital
should re ect prudent fiscal
• chievement of rimar urplus expenditure by 25.4% over the
management. How did Budget 2017-
where primar deficit iscal deficit previous year
fare in terms of fiscal prudence
–interest payments) • argeting a . fiscal deficit
management? This paper looks at the
• gradual move towards primar for 2017-18, followed by 3% in the
important question regarding prudent
surplus equivalent to interest subsequent year, in line with the
fiscal management in ndia. uch
payments FRBM Committee recommendation.
Dr. Tulsi Jayakumar_Cover Story.indd 34 3/2/2017 2:02:17 PM

Cover Story
• et mar et borrowing of personal income ta collections, which have been budgeted at higher in
overnment restricted to s. . absolute terms than in the previous ear, with a ta buo anc of around . ,
la h crores afterbu bac in , while corporate ta is budgeted at above the previous ear. learl , this is
much lower than s. . la h crores a tall order, especiall given the lowering of the ta rates from the e isting ten
of the previous ear. per cent to five per cent for individuals, s, association of persons, bod
• evenue Deficit of . in of individuals and artificial persons where the total income is between two la h
stands reduced to . in fift thousand rupees and five la h rupees and in the case of resident individual
the evised stimates. he evenue between the age of si t ears and eight ears, where the total income is
Deficit for is budgeted at between three la h rupees and five la h rupees. urther, udget
. ,against mandated b the clearl anticipates an increase in the indirect ta to D ratio once the new
ct. s stem stabilizes.
ANALYSIS he problems in fiscal prudence arise because of the continuous deterioration

e have e amined the adherence to in the proportion of direct ta es to the overall ta revenue. s seen in able ,
fiscal prudence in terms of receipt the share of the direct ta es in overall ta revenue increased to a pea of about
and e penditure management b the in , after which it has steadil fallen. he regressive nature and
government in the budget , as in ationar potential of the indirect ta es would dictate against a s stem of
also in the medium term. higher proportion of ta revenues coming out of indirect ta es.
RECEIPT MANAGEMENT TABLE 1: CONTRIBUTION OF DIRECT TAXES TO

Tax revenues:
TOTAL REVENUE (Amount in Rs. crore)
udget has envisaged gross D D L D
ta revenue at . of D . he L
growth in gross ta revenues has been
estimated to be moderate considering L
the high base on account of
.
substantial growth achieved in the
current ear. n , the .
growth in gross ta revenues have .
been estimated at . per cent over .
the revised estimates of as
against the growth of per cent .
growth estimated in the revised .
estimates of current ear. he .
budget document spea s of the
demonetization e ercise and the .
implementation of as factors .
contributing to broaden ta base and .
in the process increase the ta to D
ratio. he e pectation that is put for .
ward is that actual ta collections ma .
e ceed budgeted estimates. .
uch of the increase in ta receipts .
was on account of a buo ant indirect .
ta collection, which showed a growth .
of more than per cent during pril
December, over the ource overnment of ndia, ncome a data,
http www.incometa india.gov.in Documents ime eries Data inal.pdf
corresponding period in previous urther, as able demonstrates, there is little scope for fiscal space arising out
ear. hile the proportion of direct of most ta es, since the ta buo anc defined as the percentage change in ta
ta es corporation and income ta es receipts divided b the percentage change in nominal D wor s out to less
in the overall ta receipts in than for most ta es.
was about . , udget
proposes to raise this to about . .
his is largel to be driven b higher

Cover Story
TABLE 2: ASSESSMENT OF TAX BUOYANCY IN INDIA Im alance et een re enue and ca ital
2016-17(RE) 2017-18(BE) Growth Rate Tax e enditure
Revenue Receipts The imbalance between the revenue
in Rs. crores in Rs. crores of taxes (%) Buoyancy*
Gross Tax 1703242.94 1911579.46 12.23 1.04 and capital expenditure, loosely
Revenue understood as the relatively
Corporation Tax 493923.5 538744.73 9.07 0.77 unproductive and productive
Taxes on Income 353173.7 441255.27 24.94 2.12 components of total expenditure has
Union Excise 387368.58 406900 5.04 0.43 been glaring in the Indian context as
Duties can be seen from Table 2.
Customs 217000 245000 12.90 1.10
Service Tax 247500 275000 11.11 0.95 Decom osition o e enditure
• o ina ro t rate at decomposition of the e penditure
o rce o ern ent of India d et doc ents t ors ca c ations side reveals the high proportion of
interest payments (about 25%) in
Disinvestment proceeds the overall expenditure. Not only
Moreover, the budget places an inordinately high reliance on disinvestment this, about 30% of the increase in
proceeds. These proceeds are budgeted to increase from Rs 45,500 crores in overall expenditure is on account
2016/17 to Rs. 72500 crores in 2017/18 – a 59.3% increase- which is clearly of rising interest payments alone.
untenable, given the level of disinvestment in the past. Similarly, a perusal of the
Financin o fiscal deficit overall subsidies shows that
he financing of fiscal deficit has further issues on the revenue side, since there while the fertilizer subsidy
is an emphasis on drawdown of surplus cash balances, as also a greater reliance has been kept unchanged, food
on securities issued against small savings schemes. The former really is an subsidies have been marginally
indicator of poor and inefficient cash management b the overnment, increased, while petroleum subsidies
which renders monetary liquidity management by the Reserve Bank of India have been reduced. Interest
difficult. s regards the latter, such small savings schemes have relied more on subsidies however have witnessed
public sector institutional investors rather than the small investors, rendering a 19.4% increase from Rs. 19424.53
such schemes meaningless. gain, the relevant figure to udge the e tent of crores in 2016/17 to Rs.23204 crores
market borrowings by the central government is the gross market borrowings in 2017/18.
inclusive of repayments (Rs. 1.57 crores), which works out 5.05 lakh crores.
This creates a further pressure on the government’s debt management through
I
increasing the interest payment requirements, and at the same time having

repercussions in the form of crowding out effects.
I
rudent fiscal management re uires
I the elimination of revenue deficit
he budget has sought to reduce thefiscal deficit to . of D despite at the earliest so that the borrowed
an increase in capital expenditure by 24.5% over the previous year. However, fundsareused for investment
this increase in the capital expenditure works out to a mere 0.54% increase as expenditure. However, the medium
a proportion of to total expenditure (from about 13.89% to 14.43% of the term roadmap specified b the
total expenditure). Further, of this, only 16 per cent of the total expenditure government lays out a revenue
is growth-supporting investment expenditure (capital outlay excluding defence). deficit of . of the D and .
I I I
I
Year Revenue Expenditure (as % of total expenditure) Capital expenditure (as a % of total expenditure)
2008-09 89.8 10.2
2009-10 89 11.00
2010-11 86.92 13.08
2011-12 87.89 12.16
2012-13 88.13 11.83
2013-14 87.97 12.03
2014-15 88.18 11.82
215-16 85.87 14.13
2016-17 (RE) 86.11 13.89
2017-18 (BE) 85.87 14.43
Source: Government of India, Union Budget 2017-18, http://indiabudget.nic.in

Cover Story
of the GDP in 2018/19 and 2019/20 by rating agencies has led to India being designated the “outlier”, since its
respectivel . his is ustified thus general government fiscal deficit ratio of . percent in and debt are
out of line with its emerging market “peers”. Further, they claim that this is
ontaining revenue deficit is an despite ndia maintaining an impeccable record of fulfilling its debt service
importantbenchmark for assessing obligations in a timely manner. India, despite its growth and macroeconomic
fiscal prudence in normal stabilit since , has been continuousl rated a low . n fact, in
circumstances. However, in the ovember , tandard oor s ruled out the scope for a ratings upgrade
conte t of the fiscalfederal for India for a considerable period, quoting its low per capita GDP and its
arrangements between the Centre high fiscal deficit. ontrast this to hina, which despite its ominous scissors
and theStates in Indian context, the pattern” of a growing credit-GDP ratio alongside a falling GDP growth, has
Centre transfers to States, even those been continuously rated AA- by international credit rating agencies since 2010.
meant for capital e penditure, ow in
theform of revenue grants, and the f the government is worried about its credit rating, it needs to focus on fiscal
specific need to enhance allocations prudence, since credit rating agencies not onl loo at the fiscal deficit, but also
on important revenue components of fiscal management.
expenditure, particularly on n the face it of it, ndia s public debt appears sustainable and indeed
maintenance works, anexcessive manageable , given that it fulfills the two necessar conditions stated b the
focus on reducing revenue deficit economist Domar for public debt sustainability. The real rate of interest, in
will becounterproductive and may particular, has been lower than the real rate of growth. However, it is the
even impact return oncapital assets sufficient condition for such sustainabilit , which poses a problem in the
in the economy. However, efforts for ndian conte t. uch sufficienc of debt sustainabilit re uires the generation
further rationalization of non- of primary balance and primary revenue balance surpluses. India, however, has
productive revenue expenditure will had far greater primar deficits over the past decade than all its peers, especiall
remain in focus”. when compared with its rate of growth.
Again, there is no mention of
primar deficit in the government s CONCLUSION
budget statement, nor in the hile the government has claimed fiscal consolidation, it is clear that there is
medium term fiscal polic statement. much left to be desired both on the revenue and on the expenditure side. While
he continuation of primar deficit fiscal deficit has been ostensibl brought down from . to . of D ,
and financing of interest pa ments the ualit of financing the deficit, as also the nature of the deficit itself raises
to the tuneof around 3 per cent of some uestions regarding fiscal sustainabilit .
GDP from borrowed funds question ssessing the parameters of fiscal prudence, the following conclusions are
the fiscal sustainabilit of the drawn
Government. • here is a persistent revenue deficit at . of D into ,
We conclude that the persistence of a indicative of dissavings by the government, acting as a drag on growth apart
large revenue deficit and the absence from pre-empting high cost borrowed funds from being used for investment
of a primary surplus have not expenditure
provided any leeway to the • apital e penditure as a proportion of D is low less than
Government to create an enduring • igher gross mar et borrowings b the government whichwill contribute to
fiscal space. higher interest pa ments and will e acerbate the vicious c cle of deficits and
debt, besides crowding out private investment.
he case for fiscal prudence gains • here is non achievement of rimar urplus which uestions fiscal
greater importance due to the sustainability
impact of rising fiscal deficits on the • mall savings coming from public sector institutional investors, which goes
debt-to-GDP ratio, and the attendant against the spirit of small savings
ramifications on credit ratings • here is persistence of maintenance of government s cash balances
and borrowing costs. The general with the , indicative of inefficienc in the government s prudent cash
government debt-to-GDP ratio at management, ma ing it difficult for the s avowed ob ectives of neutral li uidit
68.5 per cent for India is highest management.
among all emerging economies,
except Brazil. The government claims ll in all, nion udget is a case of ot much fiscal prudence,
in the Economic Survey that the despite the government s claims to the contrar
practice of combining a group
of countries and then assessing
comparativel their fiscal outcomes

Cover Story
“India’s Fiscal Budget 2017 :

Economic & Political Fallout”
Vijay Kalantri
President - All India Association of Industries
Vice Chairman - World Trade Centre Mumbai
Mr. Vijay Kalantri VijayKalantri@balaji.co.in
I ndia s fiscal budget has alwa s

attracted global attention as ndia
is slated to be the destination for
lot of positives but the deviations
occur due to failed implementation
which is again due to the framewor
of the rich capitalists ma ing them
richer.
investment. t is no longer a guessing for implementation still inadequate hough digital ndia has received a
situationfor fiscal allocations and the and suffering. o be simple budget high impetus however, realization
same are based on earlier indicated allocations need to be sturd , specific of the same can be predicted with
propositions. and infrastructure based rather than efficienc given the poor
sector or scheme based which histor infrastructure in place. D
udget allocations have been an suggest have failed to deliver. he based subsidies and financial
indicator of good or bad fortunes budget though in its new transactions for the rural poor have
in various sectors due to the very avatar has repeated the age old been proposed however, it should
fact that India has been a favorite mista e of allocations made in be aptly noted that even inspite of
destination for landing of short schemes and sectors. creation . rore an Dhan ccounts
term foreign capital primaril for the rural ndia is still unban able.
reason that Indian policies are volatile n conte t to budget there There is no doubt that inspite of the
and there can be a random economy is a high investment in rural sector allocations most of the funds would
adjustment at any point of time apart which is not a new landscape. go in the poc ets of undesirables or
from actual commitments at the time Allocation for the crop insurance unutilized.
of budget announcements. Long scheme, as the gap between farmers
term capital investments have been cost on farming and their loss, if ro ected iscal deficit, ta to D
ver few to be counted. an , is huge. igher allocation for ratio and consumer spending to
irrigation is also a good booster to the D ratio are ones which pro ect the
It has been emphasized that Indian rural economy. health of a country in context to its
econom gives unwanted attention financial health. iscal deficit not onl
to budget announcements when in udget allocations for the rural determines the contribution of
practice the ground framewor is poor have been announced but exports over imports but also
highl unstable for polic or financial implementation is a huge issue with the inward foreign remittance.
allocations to be of any optimum hugechallenges in mapping the actual dherence to . per cent fiscal
utilizations. needy. Inspite of the allocations deficit and . per cent for ne t ear
made the uestion is whether the would bring comfort to however
he budget announcement for allocations will actuall reach the poor its implementation is a question.
has seen some ma or reforms in is a huge uphill tas . he slogans such The former an indicator of the
terms of time and framewor . he as green revolution and garibihatao domestic economy and later indicator
announcement has preceded a month have been in vogue for last ears or of global impact on domestic
before the legendar one with the so but still ndia is in the grip of econom . lobalisation cannot be
railwa budget being scrapped and povert . uch schemes and slogans denied by a country due to the
included in the main budget. he failed merel because there was no inherent fact that exports are fuelled
other reform is the integration of the mechanism which could ensure that b imports. his budget did not
plan and non plan expenditures and the benefit reached the actual need . announce any impressive duty
splitting the allocations sector wise. ost of the time budget allocations drawbac especiall on import of
his t pe of framewor does have have been siphoned for the benefit food items.
Vijay Kalantri_Cover Story.indd 38 3/1/2017 3:28:54 PM

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nbound remittances re ect the not re ect an ma or difference to the roadmap for implementation,
strength of countries to import sector s growth prospects. additional incentives for lectric
Indian labor and subsequent ehicles and brids under
contribution to a positive fiscal deficit. he ban ing sector especiall the cheme and the plan for ehicle
n case of global turmoil downsizing nationalized ban ing sector is in deep crappage scheme which is damper.
of ndian labor leads to wea ening of debt crisis due to the problem. he vehicle manufacturers are being
the domestic ndian econom in par llocation of additional capital will directed to get to uro b
with these international economies. be a temporar stop gap solution and vehicles contribute so little to
nward remittances also bac and and an introduction of a sturd pollution. ain pollutant in Delhi
foster consumerism which in turn infrastructure such as the bad ban for e ample is . , which is dust.
boosts domestic consumption. he and allocation of capital to such an ars onl contribute percent to
global slowdown has forced ndian infrastructure would have been a that according to anpur stud .
labor to come bac to ndian shores permanent remed to this issue. he o wh onl cars are being targeted
this in turn effect the support of allocation for ban capitalisation for pollution, especiall when the
inward remittances to aide lowering of , crore rupees billion are being pushed to incur the higher
of the fiscal deficit. tic ing to . pc rupees is onl a patch on the , , cost for uro is something which
of the fiscal deficit target reinforces crores that the conomic urve has is difficult to understand and accept
the credibilit of overnment of identified as the need of this vital as being fair and reasonable. t s
ndia s medium term fiscal targeting. sector. he ban ing sector has a disappointing that the corporate ta
owever,fiscal polic is the wea est ma or role to pla in spurring private rate that was being tal ed about last
aspect of ndia s credit profile investment which is lac ing and ear has not been reduced. nstead,
relative to other aa ” rated without which the all round economic the lev of the ta on dividend is
sovereigns because ndia has larger revival is not a possibilit . an ing disturbing because it goes against the
fiscal deficits and debt but the sector reforms and possibilit of thread of certaint and stabilit that
government is moving to correct it introducing the L reforms the government is tal ing about and
slowl . have found no place in the budget sends a wrong signal to investors.
allocations. ne of the most awaited he measures on setting up dispute
onetisation through divestment of e emption of Dividend Distribution resolution panels are not et well
central public sector enterprises a on the dividend declared b the understood, because there are few
individual assets would augment portfolio compan to and nv details. he reduction of the long
funds for investments, and improving has been proposed. ith this term capital gains period from three
the target of beneficiaries for various amendment, all the re uired fiscal ears to two ears is however a big
subsidies through greater use of support for and nv to positive.
adhar is e pected to result in fiscal ma e it a realit has been done. his
savings over the medium term. will support the developer and fund he budget allocations and ta reliefs
managers to raise funds through to the real estate sector will boost
he need of the hour is to nv and create li uidit confidence in this sector. relief to
accelerate the econom and promote affordable housing and is a big thing
consumption and boost domestic ndia has showed valued growth because affordable housing almost
spending, but this budget doesn t and inward remittance in the auto has an infrastructure status b giving
have an thing substantial on this industr with this industr having percent e emption on profits.
aspect. t has a lot of dampeners, and some chun of e ports thus hat s a valuedmeasure for affordable
no positive sentiment. nvestment contributing positivel to the housing. owever, one needs to bear
in ob growth is ver scant . icro D. owever, there is not much in mind that relief for the repa ment
units in the sector were the ones for uto industr in this budget. of interest as well as principal should
most affected b the demonetization nfrastructure cess increase up to have been to all categories of housing
wave. his sector accounts for nearl per cent on passenger vehicles will because one needs not onl
of the total obs though in an definitel have an impact on the affordable housing but ou need
informal wa . hese obs prices. he modalities of collection ever segment to push up demand.
concentrated mainl in te tile, leather of D of per cent on more than owever, the current rate of ob
and auto ancillar parts, however, this la h priced cars is et not clear. growth hardl supports the demand
sector has had no appreciable relief urther, curbing incentives on for housing. oor growth in demand
whatsoever in conte t to the budget. in house D spends from for housing even after introduction
he decrease of ta liabilit does per cent to per cent is not ver of ta relief does not couple with
positive. here is no presentation on demand in housing as there is no

Cover Story
expectation for fall in present prices compensating the same taxing the budget subsidized trains, divestment
which are still too high to afford rich. However, with only a few rich of unrequired railway land, would
the same. Capacity generation with now holding nearly 50% of the have created more capital for the
inadequate demand will make these total wealth will hardly make an railways. Identifying sectors which
tax reliefs useless. impact in balancing this subsidized involve jobs and a more convenient
capital. Thus it’s very awry how the labor policy suiting employer and
The budget proposal to launch a new . fiscal deficit will be contained emplo ee re uirements would benefit
health protection scheme will ensure in a scenario of surgical strikes of job growth and evidently boost GDP.
penetration of health insurance and demonetization enforced on Allocation of funds to build schools,
promote financial inclusion. he the economy and uncontrolle teachers, connecting infrastructure
proposal for additional Rs30, 000 in ationar tendencies in the ndian such as roads and bridges, food
health cover for senior citizens will economy. and healthcare in remotest villages
help reduce the burden of healthcare was most desirable for actually
expenditure for the aged. It’s Though emphasis has been given promoting financial inclusion. his
directionally progressive because of to skill development and boosting infrastructure could have provided
increase in insurance coverage, but innovation the basic infrastructure to as a medium to establish digital India
what the sector needs is a roadmap. carry out the same has been lacking. through school programs. Adult
The present healthcare infrastructure An ambitious budget allocation literacy could be promoted thus
either needs to be scaled up or to build one school and one ten making India 100% literate to
embed in itself affordable hospitals bedded hospital per village would understand the value of schemes and
run by charitable institutions under have sounded a better choice than funds allocated to them. Allocation
government subsidy scheme. The random allocation of resources which of funds most importantly in the
present status of government leaves an individual clueless about education sector will not only boost
healthcare is pathetic with sub its realization. Definite budgetar innovation but will empower the
standard staff and healthcare allocations help job seekers to acquire urban and rural poor to improve their
equipment. The budget allocation skills in a sector which sees boosts in financial status and boost financial
towards new heath protection scheme infrastructure pertinent to a certain inclusion in true means
is highly inadequate in comparison to sector.
the cost of private healthcare which is FDI have been complaining for a
far more dependable. Overall the budget is not a surprising long regarding India’s protectionist
one or neither is a dynamic one. The policies towards incoming foreign
Budget speech talks about job growth budget should be an icing on a cake capital and long regulatory processes
prominently in two sectors one of however the Indian economy has relief in prohibitions for such capital
railways and the other in case of road failed to make a good cake below the at least in the infrastructure sector
and affordable housing structure. icing thus, however good an icing is, it would have been a good proposition
However, the infrastructure sector will fail to make the cake taste good. and contribute to faster growth.
has a large appetite for private The changing of the plan non plan The scrapping of the Foreign
investment and the same requires system of expenditure or pre poning Investment Promotion Board (FIPB)
top priority clearances especially in the budget so as to start work by will help this cause, if done the correct
context to environment and land April will hardly matter to the present way. Although 90% of foreign direct
acquisition which have not been state of economy. Corrections in the investment, or FDI, currently coming
provided any relief in any shape. existing infrastructure needs solid into the country comes in through
Secondly, the railways have been hard work and die hard policies. the so-called automatic route, this
running into losses and there is Instead of a demonetization drive process is anything but automatic.
urgent need to increase the operating in midst of a recovering economy And the government also needs to
ratio of this infrastructure but there a drive for digital India , skill India, quickly clarify what will happen to the
has been no strategy devised to mark education India to remotest India remaining 10% that needs clearances
up the development and profitabilit was more essential. Creation of a from a combination of ministries.
of this sector. This budget in the new bad bank or securitization bonds to Moreover the budget does seem to be
avatar is similar to old strategies in remove NPAs from the banking aligned with the prospective reforms
new clothes. system and release of fresh capital to such as the GST.
the ailing industry was more
The budget propositions are laid on important than a demonetization Thus we can conclude that the budget
basis of the old strategy of populist drive. Upgrading quality of railway has been a major fall out.
schemes subsidizing the poor while services and creation of small

Cover Story
Accounting And Accountability

Of Capital Expenditure Projects
By Government
Ashok Datar
Economist
Mr. Ashok Datar Datar.ashok@gmail.com
M unicipal Corporation
Mumbai has a budget bigger
than that of some of the smaller
of considered a capital project. Typically
most major public projects take
between one to five ears for
Rs.100 cr and mega projects for
which the cost is beyond Rs.1000
cr. The projects should not be in the
states of India. Last year it budgeted completion. They may require nature of replacement of items
a revenue expenditure of Rs.41000 another 2-3 years for full maturity. such as trucks, buses, rail coaches or
cr, and its budget for capital exp was e have man pro ects especiall w.r.t repairs of roads, highways, bridges
Rs.12800+ cr. Both in absolute and irrigation projects going on for 10/20 etc. but they should involve a new
per capita terms, capex for Mumbai or even more years, while they were road rail lin , building a over,
is quite large. Not only that, there are initially envisaged to require 2-5 years. construction of a metro line/
several projects for which money is Obviously this leads to a huge cost networ ,or bus priorit . aste
spent by Railways, state and central escalation, running into several times recycling, hospitals, schools, colleges
governments and their agencies the original cost as well as time. This ,gardens or administrative blocks or
such as MMRDA, MSRDC etc. It much is fairly known to all of us, but redevelopment of slums or water
is observed that there is little or no there is also a lack of clarity about the purification pumping and dams
discipline at all, about keeping track uantitative and ualitative benefits for water supply are some of the
of each capital project and identify of the project. There are also other examples for Municipal public
its benefits. hat we are told is onl important issues such as resettlement pro ects. hereas, irrigation, dams,
the cost of pro ect broad benefits of project affected people and highways, power generation and
without clear understanding and the whether there are any other negative distribution are some of the
estimated period for completion. impact on environment or livelihoods examples of state projects. Similar
e can call this as an investment in of affected people or some other list can be prepared for central govt
improving infrastructure. hat unintended consequences. too. The amounts above which the
applies to a Municipal Corporation, project would require such systematic
also applies to state and central govts. Each project should have a principal comprehensive monitoring beyond
proper cost benefit anal sis in the responsible person and this should just the accounting audit would be
beginning as well as after completion not be the President, the P.M. or higher for state and central govt
of a project is very important and it is the C.M. but a minister handling a projects.
almost never even attempted. If you particular responsibility as well as a
bring transparency and governance, designated chief e ecutive officer These reports should be prepared
the first beginning should be made in for a particular project. He should every 6 months both to show the
case of capital expenditure projects. preferably be unchanged barring original vs latest revised cost and
Before the start of the project or some specific reasons and not an time estimates, reasons for any major
rather before its approval, then during officer who would be routinel or deviation beyond 10% from the
the implementation of the project otherwise transferred and there is a previous report should be explained
and after completion and when the lack of continuous responsibility in a satisfactory manner. The reports
benefits start owing. e should should be signed jointly by the
also compare what was originally It is suggested that for Mumbai principal political functionary and an
envisaged and what actually happened Metropolitan Area or BMC within it, administrative chief. These should
both in terms of cost benefit and government should consider tracking not be less than 1000 words and not
impact (+ve as well as –ve). all projects ( under implementation more than 3000 words in a language
or on drawing boards) cost of which which should be understood by
hen the benefits are available is estimated at Rs.10 cr or more, anyone who has passed 12th
over a period longer than a year it is major projects with cost beyond standard. This should be considered
Ashok Datar_Cover Story.indd 41 3/1/2017 3:36:30 PM

Cover Story
an important part of the fiduciar creating a lot of par ing problems at destinations. his e ample illustrates how
responsibilit at each level of we are een for mega pro ects involving civil engineering rather than s stemic
government. he report should be solutions.
on the website within da s of the
previous semester. e should not roviding such information right at the beginning is no favour to the public,
cover up an ma or mista es in an but it would provide a much more holistic approach to the pro ect itself b
substantive issues whether previousl those who propose it. his will also reduce the need for use of as ing for
stated or not. here must be an relevant information ustification for pro ect.
e plicit mention of whether an
alternatives were seriousl considered ome more e amples of pro ects that need to be placed in public domain
or not in the initial pro ect proposal
to be placed on the website while • n pro ect for water suppl pumping etc. should be accompanied b
inviting comments and suggestions uantitative information of how man ltrs of water suppl will get added to
from public. megapro ect li e the e isting uantit . ow man people will be benefited b the availabilit
coastal road costing s. cr for of additional uantit of water s suppl meant for residential, industrial or
a m length is ustified with a glib commercial use othing wrong in providing water for commercial industrial
one liner that doing nothing is the purposes.
onl alternative, which is not onl
false but arrogant, because it provides • n case of a road lin over within a metro or urban area, the current status
onl la h trips da mostl b cars, of traffic counts at pea hr pea direction b various modes, including the
whereas alternatives li e bus priorit no. of people carried as against, what is the new lin over envisaged to add.
on can provide at least twice ow will it benefit the public transport are the details which should be clearl
the no.of additional passengers at stated. t is important to provide current modal split and what ind of modal
th of the cost and with much split after the pro ect is completed.
lower emissions and traffic ams.
. . coaches replacing first class on • n case of footpath building or repairs m of footpath built or repaired
western railwa can also provide should be made available.
more passengers in better comfort
and speed than those who would iven below are e cerpts from budget at a glance for u taposed with
travel b cars on the coastal road previous ear estimates for roads, bridges traffic operations for umbai.
raf c erations oads rid es in ai

s.cr
ctuals evised ctual evised udget

st. st st
evenue penditure
evenue income budget
est.
ev income to e p. . . .
apital penditure
ota re ca ita e 1109 1595 1656 3040 3028 3432 5184
ource udget speech b the un. ommissioner

statement of hri itaram unte budget estimates at a
evenue income is the compensation paid b large cos corporations for digging roads for la ing cables etc. f this
mone is properl used

Cover Story
Capital Expenditure Budget Estimates - 2012-13 , 2014-15 , 2015-16 & 2016-17
2012-13 Items of Capital Expenditure 2014-15 % 2015-16 % 2016-17 %
2479 Water Supply 2191 20 1862 16 1501 12
852 Sewage Disposal 677 6 674 6 1037 8
1325 Storm Water Drains 1121 10 1098 9 999 8
308 Solid Waste Management & 496 5 423 4 317 2

Transport
655 Health Budget 727 7 799 4 901 5
1812 raffic operations, oads 2831 26 3857 33 4479 35

Bridges
139 Fire Brigade & Disaster 197 2 274 16 337 16

Management
367 epairs to rimar school 345 3 357 3 325 3

buildings
94 epairs to un. roperties 349 3 448 0 601 1

Slum Improvement
1141 others 1877 17 1862 16 2073 16
56 ardens, mar ets battoir, ? 53 0 162 1

it ngg.dept
ssessor collector dept, mech
elec.
131 nformation echnolog 106 1 129 2 145 3
74 cess of ncome over 5 . 2 0 2 0

Expenditure
9434 Total Capex Budgetd 10923 100 11838 100 12877 100
otal ape ctual 4201
source udget estimates at a glance for and statement of hri itaram unte while presenting budget estimates for to the
standing committee eb page i
he above table shows large amounts provided for capital e penditure but without a clue. ost large capital pro ects ta e
more than one ear even up to ears ence there is a need to identif all the pro ects b name and to show the ear
of their birth and completion and cumulative e penditure as well as revision in the costs or benefits.
andra orli ea Lin was e pected to cost s. cr and re uire ears to complete. t was e pected to be used b
toll pa ing crossing in the second ear of operation. he pro ect too ears to complete. he cost escalated b
times volume of crossings has not gone up be ond even after ears of successful wor ing.

Cover Story
Budget 2017: Economic and

Political Fallout
Dhananjay Samant
Author is an applied economist and social scientist specializing in quantitative analysis,
forecasting, and macroeconomic policy formulation.
dasamant@gmail.com
Mr. Dhananjay Samant
B udget 2017 contained more

positives than negatives and
demonstrated a sense of responsible
Presented by Finance Minister
(FM) Arun Jaitley, Budget 2017
contained three major changes :
3. Youth
4. Poor and Underprivileged
5. Infrastructure
continuity, with prudence largely 6. Financial Sector
superseding populism. Every Indian • The presentation of the Budget 7. Digital Economy
Budget is based on political was advanced to February 1 to 8. Public Service
considerations, but this time it was enable Parliament to avoid a Vote 9. Fiscal Management
a well-managed balancing act. This on Account and pass a single 10. Tax Administration
was also a Budget wherein what was Appropriation Bill for 2017-18. That
disclosed non uantifiabl was ust would enable the various Ministries Some key highlights of
as important as what was uantified. and Departments to fully utilize the Budget 2017 :
On all counts, India still remains a available working season before the 1. Oil prices, a rising dollar, and
highly inequitable society and we do monsoon. volatile commodity prices are seen as
hope that this Budget will go some some of the e e ternal in ationar
distance in addressing the underlying • The Railways Budget was merged risks to the Indian economy.
disparities, and bringing about with the General Budget, thus
genuinely inclusive economic growth. discontinuing a practice prevailing 2. Demonetization is a bold and
Even though the Budget looks since 1924. This is a keystep decisive measure to cleanse the
reasonably good on paper, the acid in synergizing investments financial s stem. ith the pace of
test of its efficac will lie in the in multi - modal transportation remonetization picking up, the
quality of implementation of most of throughout the country. note ban is expected to have only a
its proposals. transient effect on economic activity.
• he classification of e penditure
The stock-market welcomed the into plan and non-plan categories 3. The focus of Government
Budget. The BSESensex ended the was done away with to give an expenditure will be on rural areas,
day at 28,141, again of 485points integrated view of financial infrastructure and poverty alleviation,
or1.76%and moved up even further allocations for various sectors and within an overall framewor of fiscal
over the next two days.As far as industries and facilitate a seamless prudence.
market sentiment was concerned, that allocation of resources.
was more likely due to the absence 4. The agriculture sector is expected
of negativenews rather than the Agenda for the coming year to grow at 4.1% in the current year
presence of positive news. The and the target for agricultural credit
The FM’sagenda for the coming year
markets were clearly relieved that in has been fi ed at a record
– Transform, Energize and Clean (TEC)
there were no unpleasant surprises level of Rs. 10 lakh crores.
India, consisted of ten distinctive
in the fine print and that there was
socioeconomic themes, each of
relatively little tinkering with the 5. The provision of Rs. 38,500
whichrevolved around a politically
status quo. crores under MGNREGA in 2016-17
expedient issue. They are as given
below: is hiked to a record Rs. 48,000 crores
in 2017-18.
1. Farmers
2. Rural Population
Dhananjay Samant_Cover Story.indd 44 3/1/2017 4:01:15 PM

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6. The total allocation for the rural, fiscal deficit target for the ne t three investment, and the bigger players
agricultural and allied sectors in 2017- years is pegged at 3% of GDP. will begin to take it more seriously.
18 is Rs. 1.87 lakh crores, which is With the tax breaks and other
24% higher than the previous year. 15. To spur the digital economy, financial benefits offered to
banks have targeted to introduce affordable housing in this Budget,
7. Affordable housing to be given additional 10 lakh new PoS terminals one can expect to see much sustained
infrastructure status to incentivize by March 2017. They will be growth in this area in the years to
investment in this important segment encouraged to host 20 lakh Aadhaar come. Given the inevitable rise of
of the economy. based PoS terminals by September urbanization and the concomitant
2017. benefitsof affordable housing to the
8. The capital and development hoi polloi, that would be a welcome
expenditure of railways to be pegged . mall firms with turnover up to development indeed. Also, with many
at Rs. 1.31 lakh crores for 2017- Rs. 50 crores to pay 25% tax now, state elections around the corner, this
18. This includes Rs. 55,000 crores instead of 30%. Also, the upper limit was obviously a politically expedient
provided by the Government. for cash transactions will now be Rs. move, which had to be announced
3 lakhs. sooner or later.
9. A new Metro Rail Policy
focusing on innovative models of 17. India remains largely a tax n the ip side, real estate in ndia
implementation and financing, as well non-compliant society. The data has traditionally been the bastion of
as standardization and indigenization mining efforts (facilitated by a (sometimes unholy) nexus between
of hardware and softwareto be demonetization) will help in politicians, bureaucrats and
announced. expanding the tax net as well as industrialists. Such nexuses have, in
enhancing the tax revenues. the past, occasionallybeen responsible
10. For the transportation sector as a for the imprudent lending behavior
whole, including railway, roads, and 18. Rate of taxation for individual of public sector financial institutions,
shipping, the Budget has provided assesses between incomes of Rs. 2.5 leading to a rise in their stressed assets
Rs. 2.41 lakh crores. This magnitude lakhs to Rs. 5 lakhs reduced from and turning their balance sheets
of investment will lead to huge 10% to 5%. In lieu of this, there unhealthy.Foolproof systems will
economic activity and concomitant will be a levy of a surcharge of 10% need to be put in place to ensure
employment generation of tax payable on categories of that lending for affordable housing
opportunities in the country. individuals with annual taxable projects are not in any way siphoned
incomes between Rs. 50 lakhs and Rs. off by any of the stakeholders to
11. The Government is 1 crore. serve their vested interests. In this
considering the introduction of a context, due diligence and the careful
new law to confiscate the assets of 19. To promote transparency in monitoring of resourcescannot be
economic offenders who ee the electoral funding, the maximum overemphasized.
country. amount of cash donation that a
political party can receive from an 2. In India, even today, there is little
12. The FIPB will be abolished in individual will now be Rs. 2000. premium on honesty with regard
2017-18. A roadmap for the same to tax compliance. We have 7
will be announced shortly. In the 20. From April 1, 2017, there will be taxpayers for every 100 voters ranking
meanwhile, further liberalization of extensive efforts to reach out to the us 13th among 18 of our democratic
FDI policy is under consideration. business communityto sensitize them peers. he comparable figure
tothe nuances of the impending GST. for Sweden (a nation we often invoke
13. The focus on resolution of NPAs in our push to a digital economy) is
of banks will continue. Enactment of An analysis of some key more than 90.To paraphrase Winston
the Insolvency and Bankruptcy Code proposals Churchill … India is a poor country
and amendments to the SARFAESI full of rich people.
1. The thrust on promoting
and Debt Recovery Tribunal Acts
affordable housing for the masses is
are steps in that direction. Rs. There is no doubt that Budget 2017
a step in the right direction. Given
10,000 crores provided for bank has taken some concrete steps to
that this segment has remained for
recapitalization in 2017-18. curb tax evasion and broaden the tax
long the most unorganized in the real
net. However, not much is said and
estate sector, the infrastructure status
. iscal deficit for is done about an institutional reform
allotted to it will enable it to attract
pegged at 3.2% of GDP and the of the tax administration, which also
a relatively larger share of sectoral

Cover Story
remains a decisive factor in enhancing probabl believes that the ball is main needs to be taken with a pinch
the productivit of the fiscal s stem. now in the banks court, and that of salt. nder the circumstances,
ven the most efficient the ban sshould be held responsible did well to pla it safe and not go in
computerization and digitization for their own survival and success for a further cut in interest rates, in
processes can ta e us onl up to through their proactive actions. its monetar polic review following
a point be ond that there will the udget. f course, another e
invariabl be a decision ta en b a . he measures announced to clean factor in uencing s rate cut
human, which needs to be made as up electoral funding are small, but decision was the uncertainty
accountable as possible, if the faith a step in the right direction. e do prevailing due to the e pected
of the people in the fairness of the need to do much more to enhance changes in crude oil and base metal
s stem is not to be eroded. transparenc in our political s stem prices, which could affect in ationar
but at least a s mbolic beginning has e pectations.
. he deviation from the fiscal been made. he logical ne t step
target is relativel small at . is to mandate all political parties to Conclusion
percentage points of the D . his publicl disclose all of their Despite the fact that the udget
can be condoned considering the e penditures at ever level and also provides reason for optimism, it is
large investments the overnment reveal the sources which would be obvious that the biggest economic
is committed to making in the financing these outgoings. s things reform in ndia is a transformation of
development of the rural and the stand, there is a ris of electoral the political s stem. etting people
social sectors. he ualit of the bonds becoming a convenient to pa proportionatel for the
deficit is more important than its route for storing blac mone , thus resources the consume calls for a
uantit , and here we give the benefit defeating their raison d tre. paradigm shift in the nation s political
of the doubt to the . lso, ethos. o budgetar di tats can bring
given that the world is now . Dismantling the isan initial about that much needed change.
de globalizing and protectionist step in debottlenec ingthe s stem he primar impediment to ndia s
tendencies are emerging in mostof and indicatesthat we welcome economic progress continues to
our major export markets, there more D to fund our ambitious remain its fiscall irresponsible
is a strong case to boostdomestic development plans. ithout an politics, which encourages people to
purchasing power to reap the full ade uate in ow of D , both sta on dole rather than transit to a
economic and political benefits of a infrastructure development and development mindset, wherein there
single unified mar etspace. owever, sustained job creation in the is no free lunch. owever, there are
it is worrying that the combined econom will be difficult, and that now discernable signs that mar et
deficit of the entral and the tate will be politicall inconvenient pressures are graduall phasing
Governments is around 6-7% of especiall in an election ear. out such regressive thinking and
D . his is amongst the highest owever, abolishing the replacing it with more globall
in the free world and dents our should be followed with a persistent compatible ideas.
economic credibilit . simplification of the entire regulator
mechanism governing capital in ows
. relativel paltr allocation of into ndia, which will eventuall
s. , crores has been provided facilitate the ease of doing business
for ban recapitalization. n doing so, in the countr and thus help enhance
the FM has perhapshinted that if the our sovereign rating.
overnment eeps pumping capital
into banks without them taking any here are some legitimate concerns
initiative for their own recovery, for about the credibilit of the data
reasons best nown onl to them the used b the . fter all, not onl
ban s , it is a wasteful e penditure. was the udget presented a month
tightening in recapitalization could earlier than usual but the recent
induce ban s to go after defaulters demonetization-and the concomitant
more aggressivel and minimize disruption of economic activity
the ever greening of loans with the – has rendered suspect part of
myriad restructuring schemes now the fiscal arithmetic underl ing the
available. he e isting s in the officialpronouncements. ith this in
financial s stem are stressing it mind, some of the econom related
considerabl and the overnment informationavailablein the public do-

Cover Story
The State of Education,

Health, Nutrition and Tribal
development in Maharashtra
Manisha Karne
Professor in Development Economics
Ms. Manisha Karne Department of Economics (Autonomous)
manisha.karne@gmail.com
1. Introduction : 2. Education in Maharashtra :

Public support for education and Education has the potential to increase opportunity for deprived classes and it
health care has been historically low enables them to have social mobility. Equality of geographical, economic and
in India, averaging less than four social access to education is considered important for breaking generational
percent of GDP for education and 1 cycles of deprivation for children belonging to the socially excluded classes. It
percent of the GDP. Apart from this, is important to assess how inclusive the education policy has been in expanding
there is also underutilization of funds and broadening of economic, geographical and social access to education for
at the national level. The replication all.
of this is found in Maharashtra’s
economy. The average health As far as general education in concerned, the literacy rate of the State is 82.3
expenditure on education as percent per cent against 73 per cent at All-India level as per Population census, 2011.
of GSDP in Maharashtra from 2001 The rural –urban gap in literacy has reduced from 15.1 to 11.7 from 2001 to
to 2015-16 has been only 2.54 percent 2011 in the state. The gender gap has also declined from 18.9 to 11.5 during
of GSDP of the state whereas the the same period (Census, 2011). There is convergence in literacy rate in general
average health expenditure as percent population and SC, ST and Minorities in Maharashtra. However, the gap
of GSDP in Maharashtra from 2001 between general population and ST and Minorities (i.e. the social gap) is still
to 2015-16 has been very low at 0.45 noticeable. The gap is reducing for SC faster than that for ST population.
percent of GSDP.
Table 1 : Literacy Rate for SC and ST
Maharashtra is a leading economy
in the country, its performance in Year 1991 2001 2011
education health, nutrition and SC 54.46 71.98 78.8
tribal development is also considered ST 36.79 54.69 73
to be better compared to the national
average. However, there are many Total 64.9 76.9 82.3
shortfalls in primary education,
health, nutrition, and tribal Graph 1: Literacy for SC, ST and Total
development especially when
inter-district performance is taken
into consideration. Apart from
its performance being below the
benchmark in certain indicators, there
are serious issues of inter-district and
social disparity in outcomes. The
objective of this background note is
two-fold 1. To examine the outcomes
in view of the budgetary allocations
to these sector 2. To identify the
shortfalls to initiate dialogue for
relevant revisions in the state budget.
Manisha Karne_Cover Story.indd 47 3/2/2017 2:16:11 PM

Cover Story
Table 2: Declining social Gap in Literacy education which is exclusively based
on the ‘District Information System
Year Social Gap for SC Social Gap for ST indicates that the State ranks 13th at
primary, 16th at upper primary and
1991 10.44 28.11 th at composite levels with D
2001 4.92 22.21 0.63, 0.67 and 0.65 respectively.
2011 3.5 9.3
The state government in the year 2000
This gap is indicates that basic educational needs of the SC and ST have been committed that it will be spending 7
seriously undermined in the past. Apparently affecting adversely life chances of percent of its SDP on general and
vast sections of those who have remained mostly deprived. technical education, it spent only 2.41
% of its SDP (2012-13). The planned
2.1 Inter-district variation in educational indicators : expenditure on education has also
Maharashtra has 35 revenue districts; divided into six revenue divisions. There remained low at 3.25 %, though the
are eight educational regions for the purpose of monitoring. At present, there non-plan expenditure on education is
are 351 educational blocks, 351 block resource centers (BRCs), 56 urban more than ten percent. The norm of
resource centers (URCs) (BRC in urban areas are referred to as URC) and spending at least 75 percent the total
6170 cluster resource centers (CRCs) in the State. 43 educationally backward funds for this sector of it on primary
bloc s have been identified in districts, namel , eed, adchiroli, ingoli, education is also not fulfilled. t has
Thane, Jalna, Kolhapur, Parbhani, Nanded, Nandurbar, and Nashik. Though remained 47 percent on an average
Maharashtra is marching ahead of many other states in India, there are 57 for 2004-2013.
blocks that have LR below the national average and 13 blocks in the country
have LR lesser than the backward states in India. 1.2. Key indicators of Primary
Education in Maharashtra :
el ar committee report has ran ed district on ender gap and ducation • mproved access to schools due
Development Measure which is as below. to Sarva Shiksha Abhiyan since 2005.
Table 3 : Inter-district disparity in educational indicators. • n an average percent is
spent on primary education in the
otto e in ender a Bottom Five in Education last one decade which is less than the
Backwardness Measure commitment of the government.
Nagpur Nandurbar • ural urban gap in enrolment is
ondi a Nanded reducing rapidly.
Bhandara Parbhani • upil eacher ratio is . which
Amravati ingoli a positive sign.
Wardha Beed • ncrease in the number of
schools at secondary level especially
These laggard districts mainly belong to Marathawada and Vidarbha region.
in the urban areas. With urbanization
Districts like Sindhudurg, Kolhapur, Raigadh, Satara which are performing well
demand for schools is growing
on educational backwardness measure are also the best performing districts in
rapidly in the urban areas, however,
other indicators too.
this demand is increasingly met by
unaided schools. These schools
The State has been giving importance to primary education, which has resulted
charge comparatively higher fees and
in consistent achievement in educational outcomes at primary level. Apart
the quality is not necessarily good.
from the initiatives taken under SSA, free education up to XII class is provided
to girls. he state also has e cellent higher educational institutions in the fields
1.3. The Challenges faced by
of engineering, medical and management. The educational outcome play
Primary education in
important role in human development hence, we observe that Maharashtra’s
Maharashtra
D is better than ndia s uman Development nde . whereas, it is
0.572 for the State. • he target of all children in
school could not be achieved fully
he ducation Development nde D for primar and upper primar even in 2014-15.
levels of education and is computed b ational niversit of ducational
lanning and dministration . composite inde for elementar

Cover Story
• he number of ingle teacher • n several districts in aharashtra students who do not complete
schools in various districts of the schooling c cle. el ar ommittee eport
aharashtra is notable.
• here is sharp inter district as well as intra district variation in female
ppro .
literac , for e ample andurbar has ust . villages having female literac rate
• ulfilment of norms for e uivalent to the state average and adhchiroli has . percent of the villages
schools is mandator ; however, in the same categor .
relevance of these norms is generall
pparentl , these districts primaril bac ward in all other indicators of
ignored. on fulfilment of norms
development. andurbar is ran ed as the bottom most districts in ducation
for girl s toilet, itchen shed, ramp,
bac wardness measure in the same report. el ar ommittee eport
and compound wall are reported.
• s per the report . percent of children in to
• chool infrastructure is in a bad
standard could actuall read standard level boo and . percent could do
state in man schools, no provision
subtraction or more of standard level. o, there is a serious concern about the
in the schools to ma e the pa ment
ualit of education imparted at primar level.
of power bills, sanitation is poor.
Drin ing water facilit still missing
3. Health and Nutritional scenarios in Maharashtra
in the interior areas. appro .
aharashtra is one the si states which has performed well on the health
schools are without power suppl .
indicators laid out in the D s. he progress in and under mortalit
lassrooms are inade uate, in ,
can be seen in the following graph.
, classrooms were in shortage
as compared to the re uirement in the
Graph 2 : IMR and under 5 Mortality Rate
state. earl percent of schools in
the state lac separate toilet facilit
for girls. he urbanized districts li e
hane, umbai aigad, and une
have shortage of classrooms in
schools leading to adverse student
classroom ratio.
• eed to improve the capacit of
ribal schools for the larger outreach
of these schools.
• egular suppl of school
uniform and other material is
important for incentivizing the
attendance rate and for improving the
retention rate.
• egular suppl and better ualit he state has achievements in health indicators such as in otal ertilit ate,
of id Da meal are also needed for ontraceptive se, irth assisted, nstitutional deliveries, it is among the top
the same reason. five states in ndia. owever, there are man shortfalls and again the state
average is camou aging the inter district district disparit .
• here is need to target out
of school children in a better wa
he average health e penditure as percent of D in aharashtra from
for ma ing the primar education
to has been ver low at . percent of D of the state. his
inclusive. , children are still
naturall increases burden on out of poc et e penditure leading to a s stem
out of school D , , the
dominated b out of poc et e penditures, the poor, who have the greater
number is higher in bac ward districts
probabilit of falling ill due to poor nutrition, unhealth living conditions, etc.
of the state indicating inter district
pa disproportionatel more on health than the rich and access to health care
variation in this number. imilarl ,
is dependent on the abilit to pa . s a result, the public health care is criticized
there is an increase in the number
on the grounds of insufficient health coverage, sharp reductions in capital
of single teacher schools in mainl
investments in public health infrastructure and deterioration in the ualit of
bac ward districts of aharashtra
public health services leading to higher dependence on highl unregulated
such as ola, handara, and
private health care services.
mravati and also in hane.

Cover Story
The Independent Commission on Development and Health in India has Public health expenditure as a
ranked the states on the basis of Staff, Infrastructure and Supply of drugs (SIS percentage of total expenditure
index) in health. In this study, there has been an attempt to match the SIS Index on health in aharashtra is . in
(i.e., staff, infrastructure and supply of drugs) with the Performance Index (i.e., and it ust behind two other
percent of women who received full ANC, percent of institutional delivery, states namely UP (12.2 Percent) and
percent of women whose delivery was attended by skilled personnel, percent a asthan . percent , though there
of children (age: 12-35 months) who received full immunisation and percent of is a decline in this percentage in
children who did not receive any immunisation) for all the states in India and past three ears from . and . in
more importantly, for all the districts in India. Matching the SIS Index and the and . he total
Performance Index at the state level reveal interesting results.
public expenditure on health is
divided as . percent as revenue
here are five states, namel , aharashtra, u arat, un ab, runachal radesh
and Tripura where there is a mismatch as the SIS falls in the Best category and e penditure and onl . is capital
Performance Index is not in the same category. It indicates that in spite of good expenditure. This has obviously led
SIS, they have not been able to show good performance. to deterioration in public health
infrastructure further increasing the
At the inter-district level the composite score for rural SIS index for the better burden on people forcing them to
performing districts such as Satara, Thane, Ahmednagar, and Sindhudurg spend more from out of pocket. If
is maximum i.e. between 16 and 18 whereas for other districts the score is we examine the component-wise
between and and ondi a has the lowest score of . n public break of public expenditure, it is
health delivery system (performance Index) Sindhudurg has the highest score indicative of urban bias in the
and adhchiroli, ondi a, Dhule, andurbar, hnadrapur, anded and provision of public health services
Osmanabad have the worst score. One can observe the worst performers as more is spent on urban areas as
remain the same in this list too. compared to rural areas in the state as
indicated in the graph below.
Similar results on inter-district disparity in the health indicators have been given
in the health score computed by Kelkar committee report. A comparison with ra o onent ise rea
HDI and per capita income for the top three and bottom three ranks in the nder edica and ic ea t
state is given in the table below. e endit re a en es faced
a e assi cation ased on t e istrict ise
co re ensi e ea t core
an an in an in I an in
in on asis on asis PCI
I
PCI of ea t of ea t
core core
o ree otto
ree
Sindhudurg . Nandurbar . -
Sangli . adhchiroli .
6 Raigad . Buldhana . 25
o rce ea t scores are ta en fro t e e ar o ittee
e ort
This table clearly mirrors on the a positive link between income and health
outcome and HDI, improving livelihood options and employment
opportunities seem to be the sustainable options for the worse performing
ea t sector in a aras tra
districts, however, there is also a need to re-emphasize better delivery of health
care services in these worse performing districts so as to improve the health • nregulated private sector with
score in such districts. ence, higher allocations to health sector are ustified. var ing ualit and under ualified
owever, it has alwa s been less than percent of the D practitioners
• igh percentage of out of

Cover Story
pocket expenditure (80 to 85 percent), bottom five districts in nutritional status is presented in the following able.
due to decreasing public health
expenditure which adversely affects Table 5 : Nutritional Status in Maharashtra
the health outcomes
Sr. No Top Five Districts Bottom Five Districts
• ubstantial rural urban and inter . angli . andurbar .
district disparities in health outcomes
. olhapur . adhchiroli .
mainly due to disparities in access
to health care services, water and . handara . hane .
sanitation. . hmednagar . mravati .
• ocial disparit re ects in 5. Latur . Dhule .
variability in health outcome and ource D aharashtra,
nutritional status of s and s. or igures in parentheses indicate children with and in percent
e ample, children of s are twice ource D aharashtra,
more likely be malnourished than
other children. ra a no ris ent in orst e districts o hane ran s
• hortage of human resources in among the top three (ranks third) in economic performance and has better
the health sector. Lower density of
health workers as compared to the
norm.
• ea nesses of the health care
delivery mechanism (inadequate
coverage b s, D , ush and
RMPs)
3. Malnourishment in
Maharashtra :
Malnourishment is the biggest
challenge faced b aharashtra. he
problem of malnourishment and
undernourishment is discussed in the physical and social infrastructure, undernourishment remains a big
context of a complete contradiction challenge for the district. he nutritional scenario is dismal in hane district
of economic and demographic which has a tribal population mainl in hahapur, urbad and hiwandi.
achievement of the state on one hand rbanization in the district seems to have not resulted in man positive
and deaths due to undernourishment e ternalities for interior tribal bloc s of hane li e urbad and hahapur
on the other. which implies that urbanization and the benefits of urbanization have ver
limited spread effects in tribal areas. hose living in the interior areas are
he of gives the unaffected b the benefits of development. n the contrar , the tribal
ranking of the district as per their people living in the plain area and mainl near urban areas get some benefits of
nutritional performance. he best development and hence hiwandi in hane district, for e ample, is has better
five and worst five districts have nutritional status as compared to hahapur and urbad.
been taken in the following table for
highlighting the importance of the he intra district anal sis also indicates disturbing features. ccording to ,
link between nutrition and income which has ranked 85 tribal talukas in Maharashtra on nutritional status, (MPR,
and livelihoods in the backward on utrition b D the ran ing indicate adverse nutritional scenario in
districts of Maharashtra. Except for most of the tribal talukas in Maharashtra.
Latur, all other districts in this category
are also performing well on economic or instance, awhar talu a in alghar district is the worst bloc in the state.
fronts whereas the worst five have he miserable nutritional scenario in alghar is indicated in the table below.
predominantly tribal population ndernourishment has caused infant deaths in a short span of three months at
which further highlights the failure the beginning of the current year.
of policies for tribal in the backward
districts. he list of top five and

Cover Story
Table 6 : Undernutrition in Palghar (March, 2016) Maharashtra government resolution
of September 2014 has provided the
Weighed Normal MAM SAM Deaths 1 Birth guidelines for the implementation
(0-1yr) (1-6 of and specified that the
yrs.) should be exclusive of MLA Local
Palghar 129825 98783 26100 4942 32 10 2025 Development Fund, Hilly Area
% - 76.09 20.10 3.81 15.80 Development fund and MGNREGA.
The basic objective of the intervention
in form of Tribal Sub-Plan was
For tackling the nutritional challenge, few studies have given emphasis on to improve the standard living of
Nutrition Mission for Maharashtra at least for targeted districts, however, the tribal people. The funds under
presently there is no separate budget for programmes or schemes such as TSP have been categorized into
Supplementary Nutrition Programme and the funding is expected to come four sectors for convenience viz.
from existing schemes and programmes such as NRHM/NHM, Human education, livelihood, employment,
Development Mission, Village Health and Nutrition Committee Funds, Rogi and infrastructure. In spite of all these
Kalyan Samiti etc. Perhaps, while evaluating the performance of these districts, efforts, the tribal population in
it is strongly felt that as the nutritional status is closely linked to the livelihood Maharashtra is out of the mainstream of
issue, it could be tackled with better implementation of MGNREGs in the development. For instance, Tribal
backward districts. population has 20 percent shortfall
in male literacy, 40 percent shortfall
Loo ing at the socioeconomic profile of the poorl performing districts in female literacy and the Immunity
blocks on malnourishment, it is felt that the existence of SNP and ICDS in of tribal child is 39.3 percent as
these blocks is not adequate, it appears that the health and the nutritional status against 62.3 percent of the general
of the population in the rural and the tribal areas cannot be improved only with population. The PCI and HDI score
such interventions. The nutritional status needs to be linked closely to the issue for tribal districts is much lower as
of livelihoods. In the absence of regular livelihood for poor in rural and tribal compared to the better performing
belt, public services alone do not seem to be offering a sustainable solution for districts in Maharashtra. This clearly
their problems. brings out the inadequacies of several
government initiatives for tribal
4. Tribal Development in Maharashtra : people.
There are 35 Districts in the State and the tribal population is largely
concentrated in the western hilly Districts of Dhule, Nandurbar, Jalgaon, On the basis of the population norm
Nashik and Thane (Sahyadri Region) and the eastern Districts of Chandrapur, the government is committed to
Gadchiroli, Bhandara, Gondiya, Nagpur, Amravati and Yavatmal (Gondwana spend almost 9 percent (Currently the
Region). There are in all 47 Scheduled tribes in the state. The main tribes in population is almost 9.4 of the state
Maharashtra are the Bhills, the Gonds, the MahadeoKolis, the Pawras, the Thakurs population) of the SDP for tribal
and the Varlis. There are three tribes Viz the Kolams (Yavatmal District), development, however, the graph
the Katkaris (mainly in Thane and Raigad Districts) and the MadiaGonds below clearly indicates that it has
adchiroli District which have been notified as rimitive ribes b the remained off-track for most of the
Government of India. As directed by the Government, in 1975-76 the years in the past.
villages where more than 50 Percent of the population was tribal were
constituted into Integrated Tribal Development Projects (I.T.D.Ps.). There was TSP expenditure as proportion of the
16 such Government of India approved I.T.D.Ps. total Public expenditure in the state is
indicated in the following graph.
Expenditure on TSP as a proportion of GSDP
Graph 5 : Expenditure on TSP

as a proportion of GSDP

Cover Story
Out of the total funds allocated indices are all tribal talu as. hese alu as are concentrated in five Districts
75 per cent of the funds should be of the state, namely Thane(Post-bifurcation these talukas are actually in newly
spent on district schemes, however constituted Palghar district), Nashik, Gadhchiroli, Amravati, and Nandurbar.
even this norm has been violated Except for Thane and Nashik, the other three districts are reported as the
rampantly. On an average less than 50 most backward districts in Maharashtra on development related indicators by
percent is spent on district schemes. different studies. For example, Gadhchiroli and Nadurbar are at the bottom in
Also the funds spent as a substitute PCI ranking and also in terms of education, Nandurbar has just 0.44 percent of
and not as “additionally” (Kelkar the villages in the district having literacy above 70 percent for females.
Committee Report).
Generally, female education and education for SCs and STs is considered as the
The following table indicates the best equalizer or an instrument to achieve social and economic development of
backlog of funds (unspent funds) the underprivileged groups aharashtra Development eport, . ut the
for tribal development in the past 25 district- wise analysis indicates that as far as economic, social and geographical
years. The total backlog in absolute access to education for these sections are concerned there are unfulfilled
terms has been to the extent of targets. Hence it is observed that not only the enrolment ratios are lower
10608.58 crores in Maharashtra among these groups in many districts with a higher percentage of SC and ST
which has caused substantial loss in population but the overall dropout rate for these two groups is also relatively
term of tribal welfare. higher. The dropout rate is higher for ST as compared to SC population.
Following table indicates the disparity
in development indicators between the
general population and STs.
Source: Samarthan Table 6 : Disparity in Development Indicators in Maharashtra

Arthasankalp Adhyayan Indicator General ST Percentage
Kendra Population Difference
4.1 Tribal development vs. others 1. GER(2007-08)
in the state: i)Upper Primary 86.8 69.1 4.4
Several studies have discussed the
ii)Secondary and Higher secondary 56.5 40.9 37.9
factors responsible for deprivation
of the tribal population in the state. 2. Net Attendance Ratio(UP) Rural 81.5 83 34.7
There is land alienation, deprivation 3. Out of school children(6-17 years) 15.9 35.1 117.0
of their traditional rights on forest, 4. Average annual expenditure per 4511 1297 71.3
water and land, failure of land student
reforms for tribal, displacement of
tribal due to development projects 5. Percentage of children Immunised 62.5 39.3 37.1
etc. All these issues have been 6. PCI(Rs) 95,339 48,311 49
discussed in detail Kelkar Committee 7. D op vs bottom 0.797 0.252 68
Report. In fact the development ource el ar ommittee eport ased on lanning ommission eport
indices computed in the Kelkar
Committee Report on Regional To conclude, analysis of these three major sectors of Maharashtra’s
Imbalance indicate that there are 15 economy reveal that the budgetary provisions for Health, Education, and Tribal
Talukas which are termed as the most have always been lower than expected. In the graph below the expenditure on
backward talukas on development education and Medical and public health clearly support this statement.

Cover Story
In fact the even the funds allocated were also not spent fully and hence the Lastly, the policy makers should
unspent balance on these heads in past few years has remained a cause of give some attention to educational
concern and it is indicated in the graph below : disparity, health disparity and
nutritional shortfalls and on tribal
backwardness for achieving better
outcomes for all the sections of
population in the state by tackling
these issues and this review of
Maharashtra expects to provide
some relevant inputs in the sectors
discussed in the paper.
Reference :
Kelkar Committee Report on
Regional Imbalance (2013)
Though the literature suggests higher public expenditure could help in

reducing the disparities and help in achieving the targets, there could be other
determinants that help in reducing divergence in the outcome indicators
for these sectors such as the governance structure which could be largely
responsible for the inefficienc of the public e penditure. he uestion volume
of allocations is examined here, but the how the funds are spent is a matter of
implementation which is e uall important.

Cover Story
Decoding Electoral Bonds:

Union Budget 2017
Ms. Ananya Prem Nath
Manager- Research & Training in MEDC India
ananya@medcindia.com
Introduction must be the one notified to the Importance of Electoral

E lectoral bonds will be issued
b a notified ban for specified
denominations. f ou are een to
Election Commission and the bonds
ma have to be redeemed within a
prescribed time period.
Bond
oda , ma or political parties use the
la regime on donations to accept
donate to a political part , ou can cash donations from anon mous
bu these bonds b ma ing pa ments ainl , lectoral bond is more li e sources. earl part funding
digitally or through cheque. You a bail bond than a overnment or over an ear period came from
are then free to gift the bond to a corporate bond. lectoral bonds are un nown sources, according to the
registered political part . he bonds essentiall li e bearer che ues. he ssociation for Democratic eforms
will li el be bearer bonds and the issuing ban will remain the custodian (ADR).
identit of the donor will not be of the donor s funds until the
nown to the receiver. political part redeems the bond. urrentl , political parties are re uired
o, onl the will most li el be to report an donation of over ,
he part can convert these bonds allowed to issue these bonds, to be to the department. ut there has
bac into mone via their ban sold through notified ban s. been a trend of more donations
accounts. he ban account used owing b wa of hard cash in the
Ms. Ananya Prem Nath_Cover Story - Final.indd 55 3/1/2017 4:19:08 PM

Cover Story
smaller amounts. o fi this, the onds, for which the government is gearing up to amend the rules of the
udget has reduced the disclosure eserve an of ndia. nder the nion udget , the government capped
limit to , and insists that an the political part funding per person to a ma imum of s , .
amount over this must be paid
through che ue or the digital mode. n funding amount more than s , is re uired to be made through
he idea is that electoral bonds will che ues or digital pa ments, where all political parties are also re uired to file
prompt donors to ta e the ban ing income ta returns for the same.
route to donate, with their identit
captured b the issuing authorit . Demonetization see s to create a new normal wherein the D would be
bigger, cleaner and real. his e ercise is part of our government s resolve to
here are three ma or pla ers of eliminate corruption, blac mone , counterfeit currenc and terror funding,”
electoral bond irst pla er is the aitle said. e are aware we need to do more for our people. ontinuing
donor who wants to donate funds to with the tas of fulfilling people s e pectations, our agenda for the ne t ear is
a political part . t can be a person, ransform, nergise and lean ndia, that is, ndia,” aitle said, adding
an organisation or even a compan . that the ob ective is to clean the countr of the evils of corruption, blac
econd pla er is a national or regional mone and non transparent political funding”.
political part in the countr and the
third pla er is the eserve an of thin , in its effort to bring down the ever escalating corruption, ndia will be
ndia. the first countr in the world to introduce the concept of an electoral bond.
ntroduction of these bonds specificall aims at illing the blac mone which
New Way of Political mostl funds a political part in ndia. o, if ou are een to support a political
Funding part , there are chances that ou will have to choose between remaining
n order to structure the political anon mous and saving on ta es. lso, in the electoral bond route, while the
funding better and to bring part ma not now the identit of the donor, the ban will.
transparenc , the government made
several provisions in the nion e repared
udget of this fiscal ear.
n unprecedented announcement
was made introducing lectoral
MEDC is of the view that the budget presented by Hon’ble Finance

Minister today is path breaking in many ways. Indian subcontinent is
undergoing a sea change of fiscal polices and consolidation.
Demonetization, changing global scenario, protectionist policies of USA, need to
ensure poverty reduction and necessary attention to sectoral needs is very well
addressed in this national budget. We expect that it will take some time for
implementation of the policy initiatives and therefore for the results to be
felt and seen. In MEDC’s view this budget is progressive and growth
oriented like simultaneously clearing up the menace of parallel economy.
- by Cdr Dipak Naik
Ms. Ananya Prem Nath_Cover Story - Final.indd 56 3/1/2017 4:19:11 PM

Cover Story
Infrastr ct re i i ts of ast e ears

MEDC Research Team
Sonam Gupta & Dhanashree More
1. Introduction : rans ort oads and i i

Infrastructure refers to the fundamental iation
facilities and systems serving a country, llocation of the oad ransport
city, or area, including the services and and Highways Ministry enhanced up
facilities necessary for its economy to to , crore.
function. It typically character rises New proposal has drafted to
technical structures such as roads, allow FDI investment up to 49% in
bridges, tunnels, water supply, sewers, the e uit of an air transport under
electrical grids, telecommunications, and so government’s consideration.
forth, and can be defined as the ph sical components of interrelated s stems
providing commodities and services essential to enable, sustain, or enhance o er and oa
societal living conditions.” ternal ommercial orrowings
to be allowed to part finance
nfrastructure is the stoc of fi ed capital e uipment in a countr , including upee debt of e isting power
factories, roads, schools, etc, considered as a determinant of economic growth projects.
es of Infrastr ct re Housing Sector

Various proposals to address the
Economic Infrastructure Social Infrastructure shortage of housing for low income
a. Irrigation and Power a. Education groups in major cities and towns
b. Transport b. Health, Sanitation and Water Supply including allowing ECB for low cost
c. Communication c. Housing housing projects and setting up of a
credit guarantee trust fund etc.
Being an important segment in Indian Economy, Infrastructure plays a vital
role in development of the country. Finance Minister, Mr. Arun Jaitley gives Irrigation
the special emphasis on the segment for the rapid development of the country. s. crore to idarbha
ntensified rrigation Development
i i ts of t e Infrastr ct re e e o ent rogramme under .
We have noticed several kinds of changes in the Budget when it comes to Structural changes in Accelerated
Infrastructure. Following are Union Budget highlights in the Infrastructure rrigation enefit rogramme
development from the financial ear to financial ear . t ma being made to ma imize ow of
also arouse your interest that this sector is contributing 5.6% of the GDP benefit from investments in irrigation
currently. Also, you will see addition and eliminations of the policies and projects.
schemes.
Year 2012 - 13
Infrastructure
n government launched s , crore for infrastructure
development.
a free bonds of , crore to be allowed for financing infrastructure
pro ects in .
n the financial ear , overnment has approved guidelines
for establishing joint venture companies by defence PSUs in PPP mode.
L has put in place a structure for credit enhancement and ta e out
finance for easing access of credit to infrastructure pro ects.
Budget pointers-Consolidated_Cover Story.indd 57 3/2/2017 2:20:01 PM

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Allocation for AIBP in Year 2013 – 14
2012-13 stepped up by 13 Infrastructure
per cent to Rs.14,242 crore. In 2013 – 14 government has announced Infrastructure tax-free bond of
Irrigation and Water Resource Rs 50,000 crore and also raising corpus of Rural Infrastructure Development
Finance Company being Fund (RIDF) to Rs. 20,000 crore
operationalised to mobilise large , crore to D to finance construction for warehousing. indow
resources to fund irrigation projects. to ancha ats to finance construction of godowns.
ood management pro ect Infrastructure Debt Funds (IDF) to be encouraged
approved by Ganga Flood Control IIFCL to offer credit enhancement
Commission at av cost of Rs.439
crore for Kandi sub-division of Transport Ports
Murshidabad District. Two new major ports will be established
in Sagar, West Bengal and in Andhra Pradesh
Rural Infrastructure Development to add 100 million tonnes of capacity.
Fund (RIDF) A new outer harbour to be developed
Allocation under RIDF in the VOC port at Thoothukkudi, Tamil
enhanced to Rs.20,000 crore. Nadu through PPP at an estimated cost of
Rs.5,000 crore earmarkedv exclusively Rs. 7,500 crore.
for creating warehousing facilities.
Budgetary allocation for Road
rural drinking water and sanitation Build roads in North eastern states and connect them to Myanmar with
increased from Rs.11,000 crore to assistance from WB & ADB
Rs.14,000 crore representing an 3000 kms of road projects in Gujarat, Madhya Pradesh, Maharashtra,
increase of over 27 per cent. a asthan and ttar radesh will be awarded in the first si months of
Allocation for PMGSY increased & set up of regulatory authority for road sector.
by 20 per cent to Rs.24,000 crore
to improve the road connectivity. Waterways
A bill to declare the Lakhipur-Bhanga stretch of river Barak in Assam as the
EDUCATION sixth national waterway to be moved in Parliament.
6,000 schools proposed to Preparatory work underway to build a grid connecting waterways, roads and
be set up at block level as model ports.
schools in Twelfth Plan.
Rs. 3,124 crore provided for Education
Rashtriya Madhyamik Shiksha A grant of Rs. 100 crore each made to 4 institution of excellence.
Abhiyan (RMSA) representing an 27,258 crore provided for Sarva Shiksha Abhiyaan (SSA)
increase of 29 per cent over BE
2011-12. Power
Projects approved by National uidelines regarding financial restructuring of D have been
Skill Development Corporation announced. tate overnment urged to prepare the financial restructuring
expected to train 6.2 crore persons plan, quickly sign MoU and take advantage of the scheme.
at the end of 10 years with the
allocation of Rs.1,000 crore fund. Year 2014 – 15
Infrastructure
Health Shyama Prasad Mukherji Rurban Mission for integrated project based
National Urban Health infrastructure in the rural areas
Mission is being launched. An institution to provide support to mainstreaming PPPPs called 4PIndia to
Pradhan Mantri Swasthya be set up with a corpus of Rs. 500 crores.
Suraksha Yojana being expanded
to cover upgradation of 7 mor Smart Cities
Government medical colleges. sum of s. crore is provided in the current fiscal for the pro ect of
developing “one hundred Smart Cities”
Irrigation
1000 crore provided for “Pradhan Mantri Krishi Sinchayee Yojna” for
assured irrigation.

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Transport Road 15 Model Rural Health Research
14,389 crore provided for Pradhan Mantri Gram Sadak Yojna(PMGSY) . Centres to be set up for research on
An investment of an amount of Rs. 37,880 crores in NHAI and State Roads local health issues concerning rural
is proposed which includes Rs. 3000 crores for the North East. population.
Work on select expressways in parallel to the development of the Industrial
Corridors will be initiated. For project preparation NHAI shall set aside a sum Housing
of Rs. 500 crore. Allocation for National Housing
Bank increased to Rs. 8000 crore to
Shipping support Rural housing.
Government will be allocated 11635 Mission on Low Cost Affordable
crore for the development of Outer Housing anchored in the National
Harbour Project in Tuticorin for phase I. Housing Bank to be set up.
Inland Navigation: Project on A sum of Rs. 4000 crores for
Ganges called “Jal Marg Vikas” to be NHB from the priority sector lending
developed between Allahabad and shortfall with a view to increase the
Haldia. ow of cheaper credit for affordable
New Airports: Scheme for housing to the urban poor
development of new airports in Tier I LIG segment is provided
and Tier II Cities to be launched.
Education
Energy Initial sum of Rs. 100 crore for
They also owed 100 crore for a new scheme “Ultra-Modern Super Critical “Start Up Village Entrepreneurship
Coal Based Thermal Power Technology.” Programme” for encouraging
Rs. 500 crore for “Deen Dayal Upadhyaya Gram Jyoti Yojana” for feeder rural youth to take up local
separation to augment power supply to the rural areas. entrepreneurship programs
School education : An amount
New & Renewable Energy of Rs. 28635 crore is being funded
500 crores government provided for Ultra Mega Solar Power Projects in for Sarv Shiksha Abhiyan(SSA)
Rajasthan, Gujarat, Tamil Nadu, Andhra Pradesh and Laddakh. and Rs. 4966 crore for Rashtriya
400 crores provided for a scheme for solar power driven agricultural pump Madhyamic Shiksha Abhiyan
sets and water pumping stations. (RMSA).
An amount of Rs. 100 crores set aside for “Agri-tech Infrastructure Fund” Rs.500 crore provided for “Pandit
Madan Mohan Malviya New Teachers
Water supply & sanitation Training Programme” to infuse new
New programme “Neeranchal” to give impetus to watershed development training tools and motivate teachers.
in the country with an initial outlay of Rs.2142 crores. 100 crore provided for setting up
, habitations affected with arsenic, uoride, heav to ic elements, virtual classrooms as Communication
pesticides fertilizers to be provided safe drin ing water through communit Linked Interface for Cultivating
water purification plants in ne t ears nowledge L and online
Rs. 100 crore provided for Detailed Project Reports for linking of rivers. courses.
2037 crores provided for Integrated Ganga Conservation Mission Higher education : 500 crore
“NAMAMI , GANGE”. provided for setting up 5 more IITs
crore provided for hat development and beautification at edarnath, in the Jammu, Chhattisgarh, Goa,
aridwar, anpur, aranasi, llahabad, atna and Delhi. ndhra radesh and erala.
5 IIMs in the States of HP, Punjab,
Health Bihar, Odisha and Rajasthan.
A national level research and referral Institute for higher dental studies to Pan India programme “Digital
be set up. India” to with an outlay of Rs. 500
AIIMS like institutions in Andhra Pradesh, West Bengal, Vidarbha in crore to be launched. Programme for
Maharashtra and Poorvanchal in UP. A provision of Rs.500 crores made. promoting “Good Governance” to
12 new government medical colleges to be set up. be launched. A sum of Rs. 100 crore
States’ Drug Regulatory and Food Regulatory Systems to be strengthened by provided.
creating new drug testing laboratories and strengthening the 31 existing State s. crore is provided for isan
laboratories. TV, to disseminate real time
information to the farmers on issues

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such as new farming techniques, involving academicians, and drawing upon national and international
water conservation, organic farming experiences to foster a culture of innovation, research and development. A sum
etc. of Rs.150 crore will be earmarked.
5 new Ultra Mega Power Projects, each of 4000 MW, in the Plug-and-Play
Urban Development mode.
Vision of the Government is that Investment in infrastructure will go up by Rs70,000 in 2015-16 over last year
500 urban habitations to be provided Tax free infrastructure bonds for the projects in the rail, road and irrigation
support for renewal of infrastructure sectors. PPP mode of infrastructure development to be revisited and
and services in next 10 years through revitalized.
PPPs.
Present corpus of Pooled Transport
Municipal Debt Obligation Facility The transport allowance exemption hiked to Rs 1,600 per month from
facility to be enlarged to Rs. 50,000 Rs 800 per month.
Crore from Rs. 5000 crore. Port: public sector will be encouraged, to corporatize, and become
100 crore provided for Metro companies under the Companies Act to attract investment and leverage the
Projects in Lucknow and huge land resources.
Ahemdabad. Irrigation
Rs.5,300 crore to support micro-irrigation, watershed development and the
Others Pradhan Mantri Krishi Sinchai Yojana’.
Incentives for Real Estate
Investment Trusts (REITS). Rural Infrastructure Development Fund (RIDF)
Complete pass through for the Rs.25,000 crore in 2015-16 to the corpus of Rural Infrastructure
purpose of ta ation. modified Development Fund (RIDF) set up in NABARD
REITS type structure for
infrastructure projects as the Education
Infrastructure Investment Trusts New All India Institute of Medical Science (AIIMS) to be set up in J&K,
(INVITS). Punjab, Tamil Nadu, Himachal Pradesh and Assam. Another AIIMS like
Corpus of Rural Infrastructure institutions to be set up in Bihar.
Development Fund (RIDF) raised A post graduate institute of Horticulture Research & Education is to be set
by an additional Rs. 5000 crores from up in Amritsar.
the target given in the Interim Budget 3 new National Institute of Pharmaceuticals Education and Research in
to Rs. 25000 crores. Maharashtra, Rajasthan & Chattisgarh and one institute of Science and
Allocation of Rs.5,000 crore Education Research is to be set up in Nagaland & Orissa each.
provided for the Warehouse An autonomous Bank Board Bureau to be set up to improve the governance
Infrastructure Fund. of public sector bank.
Corpus of Rs. 200 crore to be set Upgradation 80,000 secondary schools.
up to establish Technology Centre
Network for MSME sector industries. Welfare schemes
Six crore toilets across the country under the Swachh Bharat Abhiyan.
Year 2015 – 16 Rs. 5,000 crore additional allocations for MGNREGA.
Infrastructure
In 2015 – 16 government Energy
established with an annual ow of Rs. 75 crore for electric cars production.
20,000 crores to National Investment
and Infrastructure Fund (NIIF) Year 2016 – 17
(SETU) Self-Employment and Infrastructure and investment
Talent Utilization) to be established Government invested in the road sector Rs. 97,000 crore including PMGSY
as echno financial, incubation and share.
facilitation programme to support Government Road Budget is Rs 55,000 crore
all aspects of start-up business. 1000 Additional Total outlay for infrastructure Rs. 2,21,246 crore
crore to be set aside as initial amount Steps to re-vitalise PPPs: New credit rating system for infrastructure
in NITI. projects to be introduced
Atal Innovation Mission (AIM)
to be established in NITI to provide
Innovation Promotion Platform

Cover Story
Transport Road Year 2017-18
Total investment in the road sector, Infrastructure : for efficienc ,
including PMGSY allocation Rs.97,000 productivity and quality of life
crore during 2016-17. Dairy Processing and
To approve nearly 10,000 kms of Infrastructure Development Fund
National Highways in 2016-17. to be set up in NABARD with a
Allocation of Rs.55,000 crore in the corpus of Rs. 2000 crores and will
Budget for Roads. Additional Rs.15,000 be increased to Rs. 8000 crores over
crore to be raised by NHAI through 3 years
bonds.
Amendments to be made in Motor Vehicles Act to open up the road Irrigation
transport sector in the passenger segment. Dedicated Micro Irrigation Fund
Allocation under Pradhan Mantri Gram Sadak Yojana increased to in NABARD to achieve ‘per drop
Rs.19,000 crore. Will connect remaining 65,000 eligible habitations by more crop’ with an initial corpus of
2019. Rs. 5,000 crores
The Long Term Irrigation :
Education Fund already set up in NABARD to
62 new Navodaya Vidyalayas will be opened to provide quality education be augmented by 100% to take the
Higher Education Financing Agency to be set-up with initial capital base of total corpus of this Fund to
Rs. 1000 Crores Rs. 40,000 crores
Scheme to get Rs.500 cr for promoting entrepreneurship among SC/ST MGNREGA allocation to be the
10 public and 10 private educational institutions to be made world-class. highest ever at Rs. 48,000 crores in
National Skill Development Mission has imparted training to 76 lakh youth. 2017-18.
1500 Multi-skill training institutes to be set up.
Water & Sanitation
Irrigation A sub mission of the National
A dedicated Long Term Irrigation Fund will be created in NABARD with Rural Drinking Water Programme
an initial corpus of about Rs. 20,000 crore (NRDWP), it is proposed to provide
‘Pradhan Mantri Krishi Sinchai Yojana’ to be implemented in mission mode. safe drinking water to over 28,000
Rs. 28.5 lakh hectares will be brought under irrigation. arsenic and uoride affected
habitations in the next four years.
Housing
Deduction for additional interest of Rs.50,000 per annum for loans up to Education
s. la h sanctioned in for first time home bu ers, where house cost Innovation Fund for Secondary
does not exceed Rs. 50 lakh Education proposed to encourage
local innovation for ensuring
MAKE IN INDIA universal access, gender parity and
Changes in customs and excise duty rates on certain inputs to reduce costs quality improvement to be introduced
and improve competitiveness of domestic industry in sectors like Information in 3479 educationally backward
technology hardware, capital goods, defence production, textiles, mineral fuels districts.
& mineral oils, chemicals & petrochemicals, paper, paperboard & newsprint,
Maintenance repair and overhauling [MRO] of aircrafts and ship repair.
Health
Allocation for social sector including education and health care – Rs.1,51,581
crore.
Energy
Rs. 3000 crore earmarked for nuclear power generation
A plan to increase gas production from deep-water, ultra deep-water and
high pressure-high temperature areas

Cover Story
SWAYAM platform, leveraging IT, to be launched with at least 350 Bibliography
online courses.
Skill Acquisition and Knowledge Awareness for Livelihood Promotion
programme (SANKALP) to be launched at a cost of Rs. 4000 crores. SANKALP
will provide market relevant training to 3.5 crore youth. indiabudget.nic; (Year 2012-13)
Skill Strengthening for Industrial Value Enhancement (STRIVE) will also be
launched in 2017-18 at a cost of Rs. 2,200 crores
indiabudget.nic; (Year 2013-14)
Housing
ational ousing an will refinance individual housing loans of about
20,000 crore in 2017-18
Transportation
Including rail, roads, shipping, provision of Rs. 2,41,387 crores has been
made in 2017-18.
Railway
For 2017-18, the total capital and development expenditure of Railways has
been pegged at Rs.1,31,000 crores. This includes Rs.55,000 crores provided by indiabudget.nic; (Year 2016-17)
the Government.
Railway lines of 3,500 kms will be commissioned in 2017-18. During 2017-
18, at least 25 stations are expected to be awarded for station redevelopment.
500 stations will be made differently abled friendly by providing lifts and indiabudget.nic; (Year 2017-18)
escalators.
It is proposed to feed about 7,000 stations with solar power in the medium India Brand Equity Foundation
term
Metro Rail Policy will be announced with focus on innovative models of Infrastructure Development in India,
implementation and financing, as well as standardisation and indigenisation of Prabir De: Research and Information
hardware and software System for Developing Countries
A new Metro Rail Act will be enacted by rationalising the existing laws. Trading Economics
This will facilitate greater private participation and investment in
construction and operation.
Road
Budget allocation for highways increased from Rs.57,976 crores in BE
2016-17 to 64,900 crores in 2017-18.
, ms of coastal connectivit roads have been identified for
construction and development
Others
igh speed broadband connectivit on optical fibre will be available in
more than 1,50,000 gram panchayats, under BharatNet. A DigiGaon initiative
will be launched to provide tele-medicine, education and skills through digital
technology to set up strategic crude oil reserves at 2 more locations, namely,
Chandikhole in Odisha and Bikaner in Rajasthan. This will take our strategic
reserve capacity to 15.33 MMT.
An eco-system to make India a global hub for electronics manufacturing a
provision of Rs. 745 crores in 2017-18 in incentive schemes like M-SIPS and
EDF.
A new and restructured Central scheme with a focus on export
infrastructure, namely, Trade Infrastructure for Export Scheme (TIES) will be
launched in 2017-18.
I hope new policies and scheme will generate more growth and demand for the
betterment of the economy.

Global Trend
Global Trade and

Investment Trends
Prakash Hebalkar
Dr. ebal ar is a ublic olic consultant and resident of rofi ech,
a strategic consultancy
Dr. Prakash Hebalkar profitechconsultants gmail.com
T his column focuses on trends in

global trade and investments in
the past month. his month s focus
o session of its nance c ief
o f an c e and its
dee a ersion to in ation a e
n particular, . . trade polic is
configured to promote the economic
growth of allied nations originall to
is on the possible direction of s ressed ot do estic fight the old ar even if these
lobal trateg , the erman trade cons tion and t e rice of trade relationships damage . .
provocation, global water stress oods e in it nderc t its e ro economic performance.
and the hazards of sneering at the one nei ors e orts
services econom . • r in erts t at o ic
e ond t e e ro one er an s re ations i In r s ost
erman continued to e pand ref sa to o t e id on do estic o d ar or d forei n
its trade surplus, this time even de and is a so ran in t e o ic i e do inated trade
e ceeding that of hina, accused and UK two of its biggest e port o ic Even national security policy
b resident rump of mercantilist mar ets. will be subservient to trade polic .
trade policies : ource er an is a in a f trade polic is dominant, we ll
dan ero s a e on trade w nn see hina, e ico and the
erman s got a nast habit one uilford ebruar , uartz erman become competitors.
that it s foisting on the rest of the Media ussia, in contrast will become an all
world. he countr ust announced since it doesn t pose a trade threat.
record-breaking surpluses in trade hile we wait for rump s reaction to ere s obb again
and its current account. o huge is the twin erman and hinese trade
surplus provocations, it is useful • ationa sec rit nder t is
the latter that, in , it e ceeded re i e i e sed to reinforce
that of hina a mind blowing feat to see this view on the relative
importance of trade in shaping and ro ositi e trade
considering erman s econom re ations i s
is about a third the size of hina s. international relations under the
rump administration or e ample, militar tension with
o what s the problem erman hina creates the opportunit for
chronicall overproduces andunder sanctions that simulate the function
consumes. he surpluses that this ohn obb, who runs the lobal
uerrillas blog and is an author and of tariffs allowing the . . to
creates along with those of hina circumvent trade organizations and
and, increasingl , apan force militar anal st.
domestic resistance to tariffs . n
poc ets of debt and unemplo ment a national security policy slaved to
elsewhere in the global econom , irst, here s the anal sis, in obb s
own words trade, an and all securit guarantees
such as the , the , and the euro e tended to other nations will re uire
zone peripher . a positive trade arrangement with the
• ince forei n o ic
as een co ete do inated . . he . . simpl won t protect
er an as ene ted fro t e or e tent securit guarantees to
arti cia c ea e ro ic nationa sec rit o ic n fact,
it s hard to imagine a . . polic that an nation that has a non beneficial
i es a co etiti e oost to its economic relationship with the . .
e orts en it in t e e ro doesn t view the world through a
militaristic, cold war lens. his means i.e. runs a trade deficit .
one t o t e o ern ent s
ti t eas on a e ro t its that LL other aspects of foreign ource oo o t ina e ico
fanatica sca t rift t e policy are conducted in support of a an and er an o trade
sc ar e or ac ero (slaved to) national security policy. s a es r s or d ie By
of a a anced d et is a ri ate imon Den er anuar ,
ashington ost
Prakash Hebalkar_Global Trend.indd 63 3/1/2017 4:41:09 PM

Global Trend
Do bear in mind that it is said that the Washington Post and New York Times are less likely to get inside scoops on
thinking in the White House than Fox News and the Wall Street Journal.
Looking forward to the longer term future, a recent World Resources Institute report on global water stress had some
important potential lessons for Indian entrepreneurs.
Notice that Sub-saharan Africa looks much less water-stressed than India in the 2040s. Corporate-farming focused
entrepreneurs should therefore be looking at this region to grow their business. The Chinese have already
cottoned on, as have some ndian firms li e aruturi.
Finally, given the enormous publicity given to Make-in-India, it is appropriate to caution policy makers and
economic-actors against sneering at the large and growing services sector:
The World Economic Forum asked experts from their Global Future Councils for their take on the world in 2030,
and these are the results, from the death of shopping to the resurgence of the nation state.
1. All products will have become services. “I don’t own anything. I don’t own a car. I don’t own a house. I don’t own
any appliances or any clothes,” writes Danish MP Ida Auken. Shopping is a distant memory in the city of 2030, whose
inhabitants have cracked clean energy and borrow what they need on demand. It sounds utopian, until she mentions that
her every move is tracked and outside the city live swathes of discontents, the ultimate depiction of a society split in two.
Uber, AirBnB and the like may well prove to be bellwethers of this longer term trend!
Prakash Hebalkar_Global Trend.indd 64 3/1/2017 4:39:50 PM

Global Trend
Current Topics
Mr. V. T. Pai
Ex. Director – Finance, MEDC
I DBE- arrest fallout- SBI says

further restructuring of corporate
loans to be decided through
re solution after creditors inhate
proceeding under bankruptcy law.
ban ruptc proceeding is perceived
as on revenue to force a fraud
borrower to fall in line thought it is
procedure under bankruptcy code ew da s ago senior officials of the not the best way for banks to solve
ban met partners of leading firm the most of their money says a senior
Worries SBI-may play safe with in Mumbai to explore the option of lawyer.
trouble borrower arrest or former involving the bankruptcy code for
bankers who has opposed loan to some of the large stressed loan Lenders know very well such
ia all a s ingfisher irlines account. Not all banks particularly powerful law is not entirely free
will hold back India’s largest lender some other private lenders may from obstacles, indeed one of the
state bank of India from through concerned with SBI by then banks borrowings co recently moved
life line to a trouble company and will soon met to discuss the way to high court to challenge the
proactively resigning to give business forward for the industry in the after bankruptcy process without serving
house a second choice. of arrests. the notice on the borrowers. But
it appears the immediate priority
In the course of meeting that mong other things decline with for banks to take shelter under the
followed b cost wee high profile stressed borrowers and method of reputation and raise wall of immunity
arrest by CBI the state owned high loan restructuring is likely to crop against action or law enforcements
street owned high street bank has up. When bank CEOs meet daily agencies. More so with the arrest of
chosen to see further restructuring early Feb- as managing committee D chairman ogesh ggarwal
corporate loans be decided under the members of Indian Bank association, and for other officials of the said
bankruptcy code. a bank lobby under the bank ruptcy bank. Just days after a DRT –
code loan restructuring plan is ruled infavour of SBI- led lender’s
Banks offer come together to reduce prepared by an insolvent practiced consortium for recovering more than
interest rate to convert debt into whose appointment is to be cleared Rs.6200 Cr. from Mallaya.
equity and pro long loan repayment by NCLT in 180 days of NCLT
period to help borrowers to tide over passing an insolvency resolution
difficult times and deal with business. order the practitioner takes
possession of the assets of the
But with bankers who had approved default co. takes over the
loans to ingfisher ta en to custod management it as on going company
bank employee’s work to ring fence and collects data from the
themselves against actions taken organization and banks operative
by the government enforcement offer 75% of the banks agree. If
agencies proving loans and alleged the plan is rejected NCLT order
mone laundr to alla a, public liquidation process of the co. and
transparent process of loan insolvency practitioner is appointed
restructuring approval by National as a li uidator. ccording to the
Company Law Tribunal (NCLT) leg is lation secured creditors can take
can’t be questioned. It may nor-be procession of pledged and mortgage
the best solution but then we do not assets to sell the mandre convert part
have man choices sa s officials. of their dues.
LCLT posses orders for in solving
V.T. Pai_Global Trend.indd 65 3/1/2017 4:50:25 PM

Maha Facts & Figures
STATE INCOME
T he State has always been a
major contributor to the national
economy. As the agricultural
• rratic rainfall with long dr spells in the monsoon season hampered the
Crop sector plummeting the growth of its Real GSVA i.e. GVA at constant
basic prices for the tate, to about . per cent over the previous
economy is largely governed by ear. verall, the growth of eal of griculture llied ctivities
monsoon, growth in this sector sector is e pected to decline b . per cent over the previous ear. he eal
has plummeted this year. However, GSVA of Industry sector is expected to grow at 5.9 per cent over the previous
Industry and Services sectors have year whereas, the Services sector is expected to grow at 10.8 per cent. Overall,
managed to drive the State economy the tate econom is li el to grow at . per cent during over the
to a fairly decent growth this year. previous year.
he entral tatistics ffice , GSDP (2014-15)

Ministry of Statistics and Programme irst revised estimates of ominal D for are , , crore.
Implementation, GoI revises the he eal D is estimated at , , crore resulting in e pected
base year of the national accounts growth of 5.8 per cent during 2014-15 over the previous year.
periodically to account for the
structural changes in the economy. • . . Deficit of monsoon and unseasonal rains had an adverse impact on the
CSO has revised the base year of agricultural production during 2014-15. Production of food grains declined by
the national accounts from 2004-05 nearly 24.9 per cent over the previous year. Production of cereals and pulses
to 2011-12, revised the methodology decreased b . per cent and . per cent respectivel . roduction of cotton
of compilation and included new & and oilseeds dropped by nearly 59.5 per cent and 52.8 per cent respectively.
recent data sources. As is the practice Production of fruits and vegetables also decreased by nearly 15 per cent.
internationally, sector-wise estimates However, there was increase of 19.0 per cent in the production of sugarcane.
are being presented as ‘Gross Value he eal of rop sector, thereb , is e pected to decline b . per cent.
dded at basic prices , while, ith negative growth of . per cent in orestr Logging sector as well,
ross Domestic roduct D is growth in the eal of griculture llied ctivities sector is e pected
being referred to as ‘GDP at market to be . per cent.
prices . ccordingl , ross tate
Domestic roduct D is being • n the ndustr sector, eal of ining uarr ing is e pected to
referred to as ‘GSDP at market increase b . per cent and that of anufacturing is e pected to increase
prices . he improvements in the b . per cent. eal of lectricit , as, ater uppl ther tilit
methodology for estimation and ervices is e pected to grow at . per cent whereas, that of onstruction
inclusion of new & revised data have sector is expected to grow at 1.2 per cent. During 2014-15, Real GSVA of
notable effects on the estimates. ndustr sector is e pected to grow at . per cent over .
State Economy • n the ervices sector, eal of rade, epairs, otels estaurants,
Forecast (2015-16) ransport, torage, ommunication ervices related to roadcasting sector
is e pected to grow at . per cent whereas, that of inancial, eal state
The advance estimates of the Real
rofessional ervices sector is e pected to grow at
Gross State Domestic Product
D i.e. D at constant
• . per cent. hus, during , eal of ervices sector is
mar et prices for
e pected to grow b . per cent over the previous ear. able . depicts
is e pected at , , crore,
sectoral annual growth rates of eal at basic prices and eal D .
with a growth of 8.0 per cent over
2014-15. The advance estimates of
the Nominal GSDP i.e. ‘GSDP at
current mar et prices is e pected to
be , , crore.
ESM - State Income_Maha facts & figure.indd 66 3/1/2017 4:58:14 PM

@ Preliminary estimates # First revised estimates $ Advance estimates Note : GSDP = GSVA at basic prices + Taxes
on products including import duties - subsidies on products Source : DES, GoM
State Income (2014-15) t the sub sector level, rop sector,

First revised estimates of Nominal State Income i.e. Net State Domestic growing at a pace of (-)3.2 per cent,
Product (NSDP) at current market prices is estimated at ` 15,72,037 crore in has an average share of 7.6 per
2014-15, as compared to ` 14,50,003 crore in 2013-14 showing an increase of cent in total GSVA for the State.
8.4 per cent. The Real State Income i.e. NSDP at constant (2011-12) market Manufacturing sector is growing at
prices in 2014-15 is estimated at ` 13,29,308 crore, showing an increase of 5.3 an average rate of 6.2 per cent with
per cent over previous year. Details of GSDP & NSDP are given in Annexure average contribution of about 21.3
3.1 to 3.4. per cent. With its average share of 9.9
per cent, ‘Trade, Repairs, Hotels &
• he er apita et tate ncome i.e. er apita D at current prices Restaurants’ is growing at an average
is estimated at ` 1,34,081 during 2014-15 as compared to ` 1,25,146 during rate of . per cent. ommunication
2013-14, depicting growth of 7.1 per cent over the previous year. & Services related to Broadcasting’
sector, though growing at highest
In the current series, i.e from 2011-12 to 2015-16, the GSVA of ‘Agriculture & pace amongst all the other sectors
Allied Activities’ sector has average share of 11.5 per cent in total GSVA for the of the economy, contributes on
State and its average growth at constant (2011-12) basic prices is (-)2.0 per cent. an average 1.5 per cent in the State
The average share of GSVA of Industry sector is 33.9 per cent and its average GSVA. ‘Financial services’ sector
growth rate is 4.8 per cent. GSVA of Services sector, growing at 9.0 per cent is growing at an average rate of
on an average in this series, has an average share of 54.6 per cent in GSVA of 7.8 per cent and has its average
the State economy. share of 10.3 per cent. ‘Real Estate,
Ownership of dwellings &

Professional Services’ sector with year. Table 3.2 gives sectoral annual growth rates of Real GVA (at basic prices)
average share of 18.5 per cent is and Real GDP over the previous year.
growing at an average rate of 10.8 per
cent over the period.
District Income
District Income is one of the
important barometers to measure
growth and trends in economic
development. Estimates of District
Domestic Product (DDP) are
compiled by the ‘Income Originating
Approach’ and therefore, have all
the inherent limitations. Because of
the paucity of data, use of proxy
indicators and various limitations
in estimation procedure, the DDP
may be used only to have a broad
judgment of income at district level.
Due to unavailability of data as
per the revised methodology, the
estimates of DDP and subsequently
Per Capita Net District Income have
not been compiled for Base year National Income
2011-12 series. Nominal Net National Income (NNI) for 2014-15 is estimated at ` 1,10,07,592
crore with an increase of 10.8 per cent over the previous year. Real NNI for
Indian Economy 2014-15 is estimated at ` 92,35,026 crore which is more by 7.2 per cent over
the previous year.
Forecast (2015-16)
Advance estimates for 2015-16 • he er apita et ational ncome in is estimated at , as
published by CSO, GoI reveal that against ` 79,412 in 2013-14.
the Real GDP or GDP at constant
(2011-12) prices is likely to attain a Sectoral share and growth in the current series
level of ` 1,13,50,962 crore with a The average share of ‘Agriculture & Allied Activities’ sector in GVA at basic
growth of 7.6 per cent, whereas the prices is 17.9 per cent and it is growing at an average rate of 1.6 per cent. Share
Nominal GDP or GDP at current of Industry sector is 31.0 per cent, with average growth rate of 5.5 per cent.
prices, is expected at ` 1,35,67,192 Services sector with largest share of 51.1 per cent has average growth rate of
crore. Real GVA of ‘Agriculture 8.9 per cent. Details of GDP & NDP are given in Annexure 3.5 & 3.6.
& Allied Activities’, Industry and
Services sector is expected to grow by
1.1 per cent, 7.3 per cent and 9.2 per
Source : Economic Survey of Maharashtra 2015-16
cent respectively.
Courtesy : DIRECTORATE OF ECONOMICS AND STATISTICS,
GDP (2014-15) PLANNING DEPARTMENT, GOVERNMENT OF MAHARASHTRA,
The Nominal GDP, during 2014-15, MUMBAI
is estimated at ` 1,24,88,205 crore
whereas Real GDP is estimated at
`1,05,52,151 crore. Real GVA of
‘Agriculture & Allied Activities’,
Industry and Services sector is
expected to grow by (-) 0.2 per
cent, 5.9 per cent and 10.3 per cent
respectively. The growth of the
economy during 2014-15 is expected
to be 7.2 per cent over the previous

ANNEXURE 3.1
GROSS STATE VALUE ADDED AT BASIC PRICES BY INDUSTRY OF ORIGIN &
GROSS STATE DOMESTIC PRODUCT AT MARKET PRICES AT CURRENT PRICES
(` crore)
Sr. Industry 2011-12@ 2012-13@ 2013-14@ 2014-15+
No.
(1) (2) (3) (4) (5) (6)
1 Crops 98,516 1,01,822 1,30,792 1,04,351
2 Livestock 28,557 32,826 34,999 39,728
3 Forestry and Logging 15,166 16,268 16,221 15,926
4 Fishing and aquaculture 2,939 3,516 3,852 4,751
5 Agriculture & Allied Activities 1,45,178 1,54,432 1,85,864 1,64,757
(Sub-Total - 1+2+3+4) (12.8) (12.0) (12.8) (10.4)
6 Mining and Quarrying 56,493 59,023 52,057 52,827
7 Primary Sector
2,01,671 2,13,456 2,37,921 2,17,584
( Sub-Total - 5+6)
8 Manufacturing 2,46,032 2,82,032 3,12,674 3,36,603
9 Electricity, Gas and Water Supply,
Other Utility Services 26,173 28,524 40,287 43,347
10 Construction 78,630 81,869 88,671 94,502
11 Secondary Sector
3,50,835 3,92,425 4,41,632 4,74,452
(Sub-Total – 8+9+ 10)
12 Industry 4,07,328 4,51,449 4,93,689 5,27,279
(Sub-Total - 6 + 11) (35.8) (35.2) (34.0) (33.4)
13 Trade, Repair, Hotels & Restaurants 1,05,609 1,27,792 1,38,261 1,58,391
14 Railways 5,988 6,491 6,862 7,979
15 Transport by means other than Railways 41,696 49,331 54,225 62,170
16 Storage 925 1,019 1,162 1,312
17 Communication and Services related
to Broadcasting 15,892 18,012 21,463 25,511
18 Financial Services 1,17,836 1,29,091 1,49,940 1,61,433
19 Real estate, Ownership of dwellings
& Professional Services. 1,90,870 2,24,570 2,61,667 3,07,181
20 Public Administration 39,070 43,374 47,639 54,270
21 Other services 66,625 78,318 91,994 1,08,064
22 Tertiary / Services Sector 5,84,510 6,77,998 7,73,213 8,86,311
(Sub-Total-13 to 21) (51.4) (52.8) (53.2) (56.2)
23 Gross State Value Added 11,37,016 12,83,879 14,52,765 15,78,347
(5+12+22) (100.0) (100.0) (100.0) (100.0)
24 Taxes on Product 1,62,085 1,98,304 2,30,056 2,53,948
25 Less Subsidies on Product 26,134 33,717 35,315 40,173
26 Gross State Domestic Product (23+24-25) 12,72,967 14,48,466 16,47,506 17,92,122
27 Per capita GSDP (`) 1,12,500 1,26,502 1,42,192 1,52,853
Source : Directorate of Economics and Statistics, GoM, Mumbai.
@ Preliminary + First Revised Estimates
Note- Figures in brackets show percentages to GSVA. Figures may not add up due to rounding.

ANNEXURE 3.2
GROSS STATE VALUE ADDED AT BASIC PRICES BY INDUSTRY OF ORIGIN &
GROSS STATE DOMESTIC PRODUCT AT MARKET PRICES AT CONSTANT (2011-12) PRICES
(` crore)
Sr. Industry 2011-12@ 2012-13@ 2013-14@ 2014-15+
No.
(1) (2) (3) (4) (5) (6)
1 Crops 98,516 94,985 1,13,566 86,937
2 Livestock 28,557 29,638 29,956 31,180
(Sub-Total - 1+2+3+4) (100.0) (98.1) (110.5) (92.9)
7 Primary Sector
2,01,671 2,01,264 2,07,371 1,92,368
( Sub-Total - 5+6)
8 Manufacturing 2,46,032 2,66,679 2,81,801 2,94,720
10 Construction 78,630 76,414 78,220 79,169
11 Secondary Sector
3,50,835 3,70,641 3,87,708 4,06,757
(Sub-Total – 8+9+ 10)
12 Industry 4,07,328 4,29,422 4,34,609 4,64,263
(Sub-Total - 6 + 11) (100.0) (105.4) (106.7) (114.0)
14 Railways 5,988 6,192 6,368 6,815
16 Storage 925 940 1,012 1,094
to Broadcasting 15,892 16,675 18,614 21,449
21 Other services 66,625 72,606 80,875 90,744
(Sub-Total-13 to 21) (100.0) (108.2) (115.8) (127.4)
23 Gross State Value Added 11,37,016 12,04,359 12,72,084 13,43,529
(5+12+22) (100.0) (105.9) (111.9) (118.2)
24 Taxes on Product 1,62,085 1,84,050 2,00,544 2,15,391
26 Gross State Domestic Product (23+24-25) 12,72,967 13,57,116 14,41,843 15,24,846
27 Per capita GSDP (`) 1,12,500 1,18,524 1,24,442 1,30,056
Note- Figures in brackets show percentages to col. (3). Figures may not add up due to rounding.

ANNEXURE 3.3
NET STATE VALUE ADDED AT BASIC PRICES BY INDUSTRY OF ORIGIN &
NET STATE DOMESTIC PRODUCT AT MARKET PRICES AT CURRENT PRICES
(` crore)
Sr. Industry 2011-12@ 2012-13@ 2013-14@ 2014-15+
No.
(1) (2) (3) (4) (5) (6)
1 Crops 92,739 95,234 1,23,229 98,318
2 Livestock 28,153 32,360 34,509 39,171
(Sub-Total - 1+2+3+4) (14.1) (13.3) (14.1) (11.6)
7 Primary Sector
1,88,157 1,98,674 2,22,132 2,03,058
( Sub-Total - 5+6)
8 Manufacturing 2,06,804 2,36,158 2,63,897 2,84,093
10 Construction 74,919 77,549 83,877 89,393
11 Secondary Sector
2,99,112 3,32,358 3,74,736 4,02,496
(Sub-Total – 8+9+ 10)
12 Industry 3,48,786 3,84,219 4,19,653 4,48,077
(Sub-Total - 6 + 11) (35.5) (34.7) (33.4) (33.0)
13 Trade, Repair, Hotels & Restaurants 98,061 1,18,598 1,27,416 1,45,967
14 Railways 5,126 5,552 5,866 6,820
16 Storage 792 882 986 1,114
to Broadcasting 12,883 14,745 18,059 21,465
21 Other services 58,403 69,424 82,565 96,987
(Sub-Total-13 to 21) (50.4) (52.0) (52.5) (55.4)
23 Net State Value Added 9,83,241 11,06,430 12,55,262 13,58,262
(5+12+22) (100.0) (100.0) (100.0) (100.0)
24 Taxes on Product 1,62,085 1,98,304 2,30,056 2,53,948
26 Net State Domestic Product (23+24-25) 11,19,192 12,71,017 14,50,003 15,72,037
27 Per capita NSDP (`) 98,910 1,11,005 1,25,146 1,34,081
Note- Figures in brackets show percentages to NSVA. Figures may not add up due to rounding.

ANNEXURE 3.4
NET STATE VALUE ADDED AT BASIC PRICES BY INDUSTRY OF ORIGIN &
NET STATE DOMESTIC PRODUCT AT MARKET PRICES AT CONSTANT (2011-12) PRICES
(` crore)
Sr. Industry 2011-12@ 2012-13@ 2013-14@ 2014-15+
No.
(1) (2) (3) (4) (5) (6)
1 Crops 92,739 88,883 1,07,156 82,030
2 Livestock 28,153 29,206 29,523 30,729
(Sub-Total - 1+2+3+4) (100.0) (97.8) (110.6) (93.1)
7 Primary Sector
1,88,157 1,87,382 1,93,534 1,78,532
( Sub-Total - 5+6)
8 Manufacturing 2,06,804 2,22,534 2,36,312 2,47,146
10 Construction 74,919 72,293 73,768 74,662
11 Secondary Sector
2,99,112 3,12,859 3,25,309 3,39,888
(Sub-Total – 8+9+ 10)
12 Industry 3,48,786 3,64,821 3,65,739 3,89,458
(Sub-Total - 6 + 11) (100.0) (104.6) (104.9) (111.7)
13 Trade, Repair, Hotels & Restaurants 98,061 1,08,180 1,07,181 1,16,183
14 Railways 5,126 5,311 5,475 5,859
16 Storage 792 811 852 922
to Broadcasting 12,883 13,484 15,336 17,672
21 Other services 58,403 64,129 72,185 80,994
(Sub-Total-13 to 21) (100.0) (108.1) (115.6) (127.0)
23 Net State Value Added 9,83,241 10,36,128 10,92,185 11,47,991
(5+12+22) (100.0) (105.4) (111.1) (116.8)
24 Taxes on Product 1,62,085 1,84,050 2,00,544 2,15,391
26 Net State Domestic Product (23+24-25) 11,19,192 11,88,885 12,61,944 13,29,308
27 Per capita NSDP (`) 98,910 1,03,832 1,08,915 1,13,379
Note- Figures in brackets show percentages to col. (3) Figures may not add up due to rounding.

ANNEXURE 3.5
GROSS VALUE ADDED AT BASIC PRICES BY INDUSTRY OF ORIGIN,
GROSS DOMESTIC PRODUCT AT MARKET PRICES & GROSS NATIONAL INCOME AT CURRENT PRICES
(` crore)
Sr Industry 2011-12++ 2012-13++ 2013-14++ 2014-15+
No.
(1) (2) (3) (4) (5) (6)
1 Crops 9,82,026 10,90,587 12,32,116 12,52,412
2 Livestock 3,27,301 3,75,254 4,29,662 5,00,405
3 Forestry and Logging 1,24,461 1,35,048 1,43,084 1,38,137
4 Fishing and aquaculture 68,027 79,908 97,590 1,04,297
(Sub-Total - 1+2+3+4) (18.6) (18.3) (18.4) (17.4)
6 Mining and Quarrying 2,61,035 2,85,780 2,95,978 3,04,300
7 Primary Sector
17,62,851 19,66,577 21,98,430 22,99,551
( Sub-Total - 5+6)
8 Manufacturing 14,09,986 15,73,632 17,14,730 18,45,541
9 Electricity, Gas, Water supply &
Other Utility Services 1,86,668 2,15,538 2,55,812 2,88,935
10 Construction 7,77,363 8,47,573 9,31,680 10,03,903
11 Secondary Sector
23,74,017 26,36,743 29,02,222 31,38,379
(Sub-Total – 8+9+ 10)
12 Industry 26,35,052 29,22,523 31,98,200 34,42,679
(Sub-Total - 6 + 11) (32.5) (31.8) (30.8) (30.0)
14 Railways 61,150 72,297 78,799 92,213
15 Transport by means other than Railways 3,37,347 3,88,058 4,26,423 4,80,547
16 Storage 5,108 6,165 6,164 7,409
to Broadcasting 1,25,930 1,42,969 1,79,782 2,07,959
20 Public Administration & Defence 4,91,155 5,44,637 6,09,657 7,08,535
21 Other services 5,34,827 6,17,811 6,98,905 8,26,296
(Sub-Total-13 to 21) (49.0) (50.1) (50.9) (52.6)
23 Gross State Value Added 81,06,656 92,10,023 1,03,80,813 1,14,72,409
(5+12+22) (100.0) (100.0) (100.0) (100.0)
24 Taxes on Product including import duties 8,90,060 10,57,977 12,01,322 13,50,361
25 Less Subsidies on Product 2,60,677 3,16,656 3,09,371 3,34,565
26 Gross Domestic Product (23+24-25) 87,36,039 99,51,344 1,12,72,764 1,24,88,205
27 Primary income receivable from ROW (-)76,824 (-)1,16,763 (-)1,39,887 (-)1,47,433
28 Gross National Income (26+27) 86,59,215 98,34,581 1,11,32,877 1,23,40,772
29 Per Capita Gross National Income (`) 70,977 79,632 88,992 97,402
ource entral tatistical ffice, o ,
+ First revised estimates + + Second revised estimates
Note - Figures in brackets show percentages to GVA Figures may not add up due to rounding.

ANNEXURE 3.6
GROSS VALUE ADDED AT BASIC PRICES BY INDUSTRY OF ORIGIN,
GROSS DOMESTIC PRODUCT AT MARKET PRICES & GROSS NATIONAL INCOME AT CONSTANT (2011-12) PRICES
(` crore)
Sr Industry 2011-12++ 2012-13++ 2013-14++ 2014-15+
No.
(1) (2) (3) (4) (5) (6)
1 Crops 9,82,026 9,83,873 10,25,082 9,92,159
2 Livestock 3,27,301 3,44,333 3,63,448 3,89,846
(Sub-Total - 1+2+3+4) (100.0) (101.5) (105.8) (105.5)
7 Primary Sector
17,62,851 17,84,081 18,55,615 18,80,621
( Sub-Total - 5+6)
8 Manufacturing 14,09,986 14,95,268 15,79,721 16,67,069
10 Construction 7,77,363 7,82,256 8,18,494 8,54,636
11 Secondary Sector
23,74,017 24,69,400 25,99,076 27,38,675
(Sub-Total – 8+9+ 10)
12 Industry 26,35,052 27,29,083 28,66,454 30,35,003
(Sub-Total - 6 + 11) (100.0) (103.6) (108.8) (115.2)
14 Railways 61,150 68,958 73,100 78,752
16 Storage 5,108 5,709 5,256 6,137
to Broadcasting 1,25,930 1,34,534 1,58,771 1,79,465
21 Other services 5,34,827 5,68,734 6,00,414 6,68,866
(Sub-Total-13 to 21) (100.0) (108.2) (116.7) (128.7)
23 Gross Value Added 81,06,656 85,46,552 90,84,369 97,27,490
(5+12+22) (100.0) (105.4) (112.1) (120.0)
26 Gross Domestic Product (23+24-25) 87,36,039 92,26,879 98,39,434 1,05,52,151
28 Gross National Income (26+27) 86,59,215 91,18,709 97,17,062 1,04,27,701
29 Per Capita Gross National Income (`) 70,977 73,836 77,674 82,302
ource entral tatistical ffice, o
Note - Figures in brackets show percentages to col. (3) Figures may not add up due to rounding.

ANNEXURE 3.7
NET VALUE ADDED AT BASIC PRICES BY INDUSTRY OF ORIGIN,
NET DOMESTIC PRODUCT AT MARKET PRICES & NET NATIONAL INCOME AT CURRENT PRICES
(` crore)
Sr Industry 2011-12++ 2012-13++ 2013-14++ 2014-15+
No.
(1) (2) (3) (4) (5) (6)
1 Crops 9,00,830 9,95,632 11,21,094 11,27,983
2 Livestock 3,22,150 3,69,219 4,22,764 4,92,840
(Sub-Total - 1+2+3+4) (19.6) (19.3) (19.3) (18.3)
7 Primary Sector
16,35,299 18,19,328 20,26,095 21,06,584
( Sub-Total - 5+6)
8 Manufacturing 11,46,921 12,90,236 14,13,015 15,27,003
10 Construction 7,38,206 7,94,744 8,75,102 9,43,456
11 Secondary Sector
20,08,938 22,25,516 24,57,081 26,59,770
(Sub-Total – 8+9+ 10)
12 Industry 22,38,124 24,75,499 27,10,577 29,16,422
(Sub-Total - 6 + 11) (31.2) (30.4) (29.6) (28.8)
14 Railways 48,531 57,233 61,464 72,402
16 Storage 4,351 5,338 5,214 6,194
to Broadcasting 1,02,776 1,16,822 1,35,552 1,43,273
21 Other services 4,86,673 5,64,672 6,40,121 7,61,262
(Sub-Total-13 to 21) (49.4) (50.4) (51.2) (53.0)
23 Net Value Added 71,89,515 81,50,056 91,82,341 1,01,39,229
(5+12+22) (100.0) (100.0) (100.0) (100.0)
26 Net Domestic Product (23+24-25) 78,18,898 88,91,378 1,00,74,292 1,11,55,025
28 Net National Income (26+27) 77,42,074 87,74,615 99,34,405 1,10,07,592
29 Per Capita Net National Income (`) 63,460 71,050 79,412 86,879
Note - Figures in brackets show percentages to NVA Figures may not add up due to rounding.

ANNEXURE 3.8
NET VALUE ADDED AT BASIC PRICES BY INDUSTRY OF ORIGIN,
NET DOMESTIC PRODUCT AT MARKET PRICES & NET NATIONAL INCOME AT CONSTANT (2011-12) PRICES
(` crore)
Sr Industry 2011-12++ 2012-13++ 2013-14++ 2014-15+
No.
(1) (2) (3) (4) (5) (6)
1 Crops 9,00,830 8,96,292 9,30,142 8,91,503
2 Livestock 3,22,150 3,38,734 3,57,334 3,83,331
(Sub-Total - 1+2+3+4) (100.0) (101.1) (105.1) (104.3)
7 Primary Sector
16,35,299 16,46,831 17,05,171 17,20,114
( Sub-Total - 5+6)
8 Manufacturing 11,46,921 12,22,383 12,97,724 13,75,201
10 Construction 7,38,206 7,31,387 7,65,256 7,99,506
11 Secondary Sector
20,08,938 20,73,300 21,82,379 23,00,077
(Sub-Total – 8+9+ 10)
12 Industry 22,38,124 22,98,761 24,10,850 25,54,271
(Sub-Total - 6 + 11) (100.0) (102.7) (107.8) (114.2)
14 Railways 48,531 54,750 57,278 61,043
16 Storage 4,351 4,928 4,393 5,069
to Broadcasting 1,02,776 1,08,998 1,15,565 1,17,812
21 Other services 4,86,673 5,18,022 5,45,991 6,10,247
(Sub-Total-13 to 21) (100.0) (107.7) (115.5) (127.4)
23 Net Value Added 71,89,515 75,37,348 79,82,616 85,34,815
(5+12+22) (100.0) (104.8) (111.0) (118.7)
26 Net Domestic Product (23+24-25) 78,18,898 82,17,675 87,37,681 93,59,476
28 Net National Income (26+27) 77,42,074 81,09,505 86,15,309 92,35,026
29 Per Capita Net National Income (`) 63,460 65,664 68,867 72,889
Note - Figures in brackets show percentages to col. (3) Figures may not add up due to rounding.

Maha Paryatan
LONAR FESTIVAL
Sanjay S. Dhekane
Sr. Manager (Publicity&PR)
Publicity & PR Department,
MTDC
publicity@maharashtratourism.gov.in
diversity etc.), cultural services (e.g.

recreation and tourism, education
etc.). All those services can make
touristic sights much more attractive.
People go to places with a great
biodiversity, because they want to
have new and exotic experiences, they
have never seen before. Maharashtra
is a great example of how they use
their biodiversit for their benefits.
It has a great wealth of biological
diversity in its forests, its wetlands
and in its marine areas.
More and more tourists are travelling

independently and are looking for
natural and cultural experiences. The
M aharashtra Tourism the festival. This fest will not turn beauty and uniqueness of a region’s
Development Corporation around the tried and true song and terrain and landscape is what attracts
has decided to give it, its rightful dance routine but will known as the tourists from a far.
place under the sun, by celebrating celebration of biodiversity.
first Lonar est that aims to boost Maharashtra’s mystical and most well
domestic and international tourists Tourism and biodiversity are closely ept secret is the Lonar La e is an
to this amazing place on 3rd 4th and linked both in terms of impacts and extremely beautiful place situated at
5th of March 2017. The idea behind dependency. Many types of tourism around 160 kms from Aurangabad.
this endeavour is to showcase this rely directly on ecosystem services The place also has an importance
unique destination to adventure and biodiversity (ecotourism, agri of its own as it is the only Hyper-
loving tourists across the globe -tourism, wellness tourism, adventure Velocity Crater on the earth!!
because Lonar has the charisma tourism, etc.). Tourism uses Geological studies have revealed that
to become the most sought-after recreational services and supply the lake is more than 52,000 years old.
destination. services provided by ecosystems. Low hills which surround the la e
are covered with jungle. Dense tree
The festival aims to unveil the Biodiversity is very important in the cover about a mile broad surrounds
enigma of the crater, with special day tourism sector. urthermore tourism the crater.
and night treks planned around the depends on natural resources as
lake. There will be astronomy experts food, clean water or other services of Lonar is situated around
coming over to share important bits the nature. It also provides tourism kilometers from Mumbai and 160
of information with the tourists. with free ecosystem services, like kilometers from Aurangabad, a little
Various workshops on biodiversity provisioning services (e.g. food, more than a four-hour drive from the
of the region will also be a part of materials etc.), regulating services (e.g. famous Ajanta Caves. Most tourists
climate control, pollination by insects come here to see the crater, now
etc.), habitat services (e.g. genetic considered a rich heritage site.
Lonar Festival_Maha Paryatan.indd 77 3/2/2017 2:06:10 PM

Maha Paryatan
an ed among the world s five largest cept for the small agriculture land, ruled the region between the th and
craters and the third-largest salt water the inside rim is mostl shrubs and th centuries D. he shape of the
la e in the world, the crater was first short. he forest department have temple resembles an irregular star.
discovered in b a ritish planted e otic species li e pine and
officer, le ander. eucal ptus trees to ma e a better During local festivals such as the
forest and give an e otic e perience amala Devi festival, large numbers
or ages there was much debate over to the visitors. t times lapwings and of pilgrims enter the crater. mall
whether the crater had been created horn bills across, but mon e s and shops and food-stalls are often
b a meteor or whether it has a peacoc s are regular sights. established near the crater or along its
volcanic origin because of its rim.
perfectl round basin li e structure mber la e which is ad acent to the
with definite edges. eologists, for main lake: also called little Lonar is or those drawn to stud how temples
uite some time, were in favour a small crater lake near to the main were built in the old da s, the ones
of the volcanic theor but recent la e and must have been created b in Lonar ma be of special interest
research has proved that it was the impact of a sub particle from the because the used the emadpanthi
definitel created out of the impact meteorite. st le of architecture i.e. constructed
of a meteor due to the t pical glass without the use of cementing agents.
material found around the crater, Some of the temples that tourists can t the la e itself, one of the amazing
created due to the heat generated at visit near Lonar are hegaon temple, sights is that of the hundreds of
that time. omu h temple and Dait a udan peafowl which live inside the crater.
temple to name a few.
he m stic la e surrounded b inter is the ideal time to visit Lonar.
ancient temples and natural beaut arlier nown as hivgaon because limate between ovember to
and rich biodiversit and the town is of the presence of a temple of Lord anuar remains pleasant. o get the
filled with colourful ancient tradition hiva, hegaon mainl draws the best view of the la e, one should visit
and lifest le. he destination is faithful to the ‘samadhi’ of Sant Shri before am or ust before the sun set.
home to several species of wildlife a anan ahara . hol man, he Lonar in itself is a beautiful place,
including peafowl, chinkara and brought about tremendous change ust ideal for a short brea to get awa
gazelles. igrator birds also oc to in the lives of man people with his from urban pressures.
the lake during winter months making spiritual knowledge and power within
it an ideal place for bird watchers and a short period of ears. he
wildlife enthusiasts. temple is now a source of inspiration
and spiritual insight for millions of
he crater and la e has also been devotees.
mentioned in the Skanda Puran,
the adma uran and even the he omu h temple lies near the
in i bari. part from tourists, crater rim and the water stream here
the Lonar crater also attracts scientists is believed b devotees, to be hol .
who come to stud it. he crater nimals such as sna es, langurs, deer,
is one of the unique natural fo es and mongoose can be spotted
formations in the world. in the vicinit .
he la e within the crater is both he Dait a udan emple is uite

saline and al aline in nature. he la e similar to the temples of ha uraho,
water contains various salts or sodas. in its structure and the ancient
hen the water level reduces due to carvings on the temple walls. he
evaporation during dr weather, large ancient idols of the temple have been
uantities of sodas are collected. constructed using a unique metal that
seems similar to stone. he sanctum
esident and migrator birds include of the temple is quite dark, which
the brahmin duc s, shell duc s is wh the travellers have to use a
uropean migrants , herons, torch to see the carvings inside and
red wattled lapwings, ba a weavers, on the roof. his ancient temple is
parakeet hoopoes, larks swallows are dedicated to Lord Vishnu and
found on the la e. belongs to the halu a D nast that
Lonar Festival_Maha Paryatan.indd 78 3/2/2017 2:06:17 PM

News in MEDC
News In MEDC.indd 79 3/2/2017 1:38:04 PM

News in MEDC

News in MEDC

News in MEDC
MEDC & MDL together conducted
Vendor Development Programme
for MSMEs and Start Ups, and it
went successful. More than 100
people participated in it and large
group of people are applying for
procurement which will ultimately
enhance their business in multiple
products and services.

Add.indd 3 2/3/2017 2:50:14 PM

Publishing date on 5th of Every Month RNI No. 22816/73
Postal Regd No. MCS/038/2015-17
License to post without prepayment
Mumbai - 400 001 on dated 5th of Every Month WPP License No.: MR/Tech/WPP-245/South/2017
Printed, published & edited by Mr. Suresh A. Ghorpade of behalf of Maharashtra Economic Development Council (MEDC), Printed Onlooker Press, 16, Sasoon
Dock, Colaba, Mumbai 400 005 And published from Maharashtra Economic Development Council, Y.B. Chavan Centre, 3rd Floor, Gen. J. Bhosale Marg,
Nariman Point, Mumbai - 400 021. Editor. Mr. Suresh A. Ghorpade Maharashtra Economic Development Council, Monthly Economic Digest
Add.indd 1 2/2/2017 10:22:43 AM

Union Budget 2017-18: A Gender Analysis by Prof. Vibhuti Patel MEDC March 2017

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VOL. XLVI NO.

: 05 March 2017 84 Pages `80 ISSN 2456 - 2457

OPPORTUNITIES WITH INDONESIA

Cover Page.indd 3 3/1/2017 5:57:54 PM

Add.indd 2 2/3/2017 2:48:20 PM

Maharashtra Economic Development Council, Monthly Economic Digest March 2017 3

President Desk.indd 3 3/2/2017 3:49:52 PM

VOL. XLVI NO. : 05 March 2017

- Mr. Sunil S. Bhandare - Senior Economist

Union Budget 2017- 18

Union Budget 2017-18:

Budget Focuseson Growthand

“India’s Fiscal Budget 2017 :

4 March 2017 Maharashtra Economic Development Council, Monthly Economic Digest

Content Page 3.indd 4 3/2/2017 2:22:02 PM

Budget 2017: Economic and OPPORTUNITIES WITH INDONESIA

The State of Education, Health,

Decoding Electoral Bonds :

Manager- Research & Training in MEDC India

MEDC & MDL 82

Mudra 82 Page No. 82

Maharashtra Economic Development Council, Monthly Economic Digest March 2017 5

Content Page 3.indd 5 3/2/2017 3:56:29 PM

Head of State : President Joko REVIEW OF INDONESIAN ECONOMY

6 March 2017 Maharashtra Economic Development Council, Monthly Economic Digest

INDONESIA COUNTRY_Special Feature.indd 6 3/2/2017 12:52:30 PM

Maharashtra Economic Development Council, Monthly Economic Digest March 2017 7

INDONESIA COUNTRY_Special Feature.indd 7 3/2/2017 12:36:33 PM

8 March 2017 Maharashtra Economic Development Council, Monthly Economic Digest

INDONESIA COUNTRY_Special Feature.indd 8 3/2/2017 12:36:38 PM

• ndonesia being an archipelagic

• ndonesia will boost bilateral

• ndonesia will improve fisher

• ndonesia will promote rade,

• ndonesia will support the

Foreign Direct Investment in

Maharashtra Economic Development Council, Monthly Economic Digest March 2017 9

INDONESIA COUNTRY_Special Feature.indd 9 3/2/2017 12:36:43 PM

• nternational recognition regarding

Foreign Direct Investment

• he D realization five leading

10 March 2017 Maharashtra Economic Development Council, Monthly Economic Digest

INDONESIA COUNTRY_Special Feature.indd 10 3/2/2017 12:36:59 PM

Maharashtra Economic Development Council, Monthly Economic Digest March 2017 11

INDONESIA COUNTRY_Special Feature.indd 11 3/2/2017 12:37:08 PM

12 March 2017 Maharashtra Economic Development Council, Monthly Economic Digest

INDONESIA COUNTRY_Special Feature.indd 12 3/2/2017 12:37:19 PM

STATISTIC OF FOREIGN DIRECT INVESTMENT REALIZATION BY COUNTRY OF ORIGIN 2007 – 2016

Indonesia’s investment in India omputer software, ood, paper

Maharashtra Economic Development Council, Monthly Economic Digest March 2017 13

INDONESIA COUNTRY_Special Feature.indd 13 3/2/2017 12:37:28 PM

14 March 2017 Maharashtra Economic Development Council, Monthly Economic Digest

INDONESIA COUNTRY_Special Feature.indd 14 3/2/2017 12:37:36 PM

Maharashtra Economic Development Council, Monthly Economic Digest March 2017 15

INDONESIA COUNTRY_Special Feature.indd 15 3/2/2017 12:37:45 PM

16 March 2017 Maharashtra Economic Development Council, Monthly Economic Digest

Sunil S. Bhandare_Cover Story.indd 16 3/2/2017 1:50:30 PM

Maharashtra Economic Development Council, Monthly Economic Digest March 2017 17

Sunil S. Bhandare_Cover Story.indd 17 3/2/2017 1:51:14 PM

18 March 2017 Maharashtra Economic Development Council, Monthly Economic Digest

Sunil S. Bhandare_Cover Story.indd 18 3/1/2017 11:08:51 AM

Maharashtra Economic Development Council, Monthly Economic Digest March 2017 19

Sunil S. Bhandare_Cover Story.indd 19 3/1/2017 11:08:53 AM