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Issues facing India

Issues facing India. Naxalism. Terrorism. China. Corrupt Media. Unemployment. Infrastructure. Quality of Education. Environmental degradation. Business Environment. Dependence on Agriculture. Inefficient Police. Crimes against women. Poverty. Slow Judiciary.

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Issues facing India

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  1. Issues facing India

  2. Naxalism Terrorism China Corrupt Media Unemployment Infrastructure Quality of Education Environmental degradation Business Environment Dependence on Agriculture Inefficient Police Crimes against women Poverty Slow Judiciary Ineffective system of Justice Population growth Over Regulation! Votebank Politics Corruption

  3. As things stand... Poor Business Environment Unemplyment Poor Educational standards Poor Implementation of Govt. Policies Poverty Political control over Govt. Policies Poor Agricultural Productivity Status of Women Ailing Judicial system Corruption

  4. Agenda • Political Leadership • Business Environment • Poverty • Education • Law and Order

  5. Global ranks • Per capita GDP: 141 • Human Development Index: 136 • Ease of doing business Index: 134 • Corruption Perception Index: 94 • 4th most dangerous place for women (after Afghanistan, Congo, and Pakistan)

  6. Political Leadership

  7. India grows despite and not because of the Government!

  8. Political Leadership • Control over executive and judiciary • Populism inherent to Democracy • Corruption • Electoral System • Coalition Dharma

  9. Control over Executive and Judiciary • Civil Services • CBI • Vigilance • Police • Issues with Judiciary

  10. Populism inherent to Democracy

  11. Corruption: Can it be solved? • Judicial & Police reforms and Independence of the Anti-corruption wings • Privatization • RTI • Use of IT • Initiative by private players • Income tax reforms • Simplification of the laws, lesser role of beureaucracy. • Protection to whistle blowers

  12. Political Leadership: Electoral System

  13. Coalition Dharma • Ideological differences – fractured policy debate • Blackmail • Uncertain fate of the govt

  14. Representation of People Bill, 1951 that should be "torn and thrown out".

  15. Representation of People Bill, 1951 that should be "torn and thrown out".

  16. Business Environment

  17. Growth rates of India and China • Growth rates of China, S. Korea, Taiwan, India • Infrastructure growth

  18. Poor Infrastructure • Growth rates of China, S. Korea, Taiwan, India • Infrastructure growth

  19. Slow Reform Process • Refrain from touching politically sensitive areas • Land Acquisition – New LARR Policy, 2013 • Labour Laws • Tax rates - GST • FDI in Multibrand Retail

  20. Divergent State Policies • Example: West Bengal / Gujarat / Kerala / Maharashtra / MP / UP / Bihar • Difference in the style of functioning leads to different growth trajectories.

  21. Business-politician Nexus Business control over policy making, media, implementation etc. Creates

  22. Bureaucratic Inefficiency • Scale of implementation • Performance measurement metrices • Political control • Ill conceived policies • Corruption

  23. Business Environment: Government Initiative • New R&R Policy • Thrust areas/sectors, priority sector lending • Creating infrastructure through PPP, BOT, FDI etc. • Tax holidays, single window clearance • Micro-finance

  24. Land Acquisition, Rehabilitation and Resettlement Policy, 2013 • Heavily loaded in favour of land owners • Huge mark up to the historical market price to determine compensation amounts • Numerous entitlements to landowners including permanent job and upfront payment • Prohibiting the use of fertile agricultural land (beyond 5% per district) may be counter productive.

  25. “Socialism is the destiny of any society. But it must pass through Capitalism first.”

  26. Agenda • Poverty • Business Environment • Education • Political Leadership • Law and Order

  27. Poverty • Population below poverty line: 29.8% • World Hunger Index Rank: 94 (of 119) • 43% Indian children under 5 are underweight and 58% stunted as of 2008 - the highest in the world Sector wise contribution to GDP

  28. Govt Initiative: Subsidies Money granted by the Government to keep down the prices of commodities. Issues: • Opportunity cost of money • PDS losses • Market distortions • Inclusion/exclusion errors • Environmental impact

  29. Subsidies in India: Alternative • Direct Benefits Transfer Scheme • Bolsa Familia Programme • Implementation • UID Programme • Aadhaar Integration, ERP Integration and Integration with nodal bank and payment gateways

  30. Subsidies in India: Alternative • Direct Benefits Transfer Scheme • Conditional Cash Transfer • Bolsa Familia Programme • Implementation • UID Programme • Aadhaar Integration, ERP Integration and Integration with nodal bank and payment gateways • Direct transfer of Subsidy through state govt followed by UID based benefit transfer to the targets

  31. DBTS: Risks • Proper Identification of beneficiaries • Addressing the liquidity constraint • Price indexing of the subsidies • Controlling the overall scale of expenditure • Black marketing

  32. Govt Initiative: Food Security Bill • Provision of subsidized food grain for 67% of the population (75% rural and 50% urban population to be covered) • To provide Rice, wheat and coarse cereal at Rs. 3, 2 and 1 respectively. The most optimistic estimates put the cost of the scheme to Rs. 1.3 lakh crore per annum (11% of the net expenditure)

  33. Food Security Bill: Critique • Do we need it? • How are we going to fund it? • Impact on other items? • Can we deliver? • Isn't it too obvious?

  34. Govt Initiative: Food Security Bill • Political implications • Public distribution system • Cross Subsidy

  35. Govt Initiative: MGREGS "the largest and most ambitious social security and public works programme in the world" Issues Net value add Impact on the job market Impact on the budget

  36. Poverty: Summary • Poverty and Unemployment go hand in hand. • Govt. schemes for poverty alleviation focus on creating jobs & subsidies in agri & other produces. • Govt schemes are marred by ill-conception, scale of implementation and corruption.

  37. Education • Literacy rate: 74% (82% for men and 65% for women) (world average: 84%) • Only 15% of Indian students reach high school, and just 7% graduate • Consistent share of at least 3% in the budget spend since freedom.

  38. Access to Education

  39. Right to Education Act • Education is the fundamental right of every child between the ages of 6 and 14 • Private schools to reserve 25% of seats to children from poor families • It prohibits all unrecognized schools from practice • No donation and no interview for admission • No child shall be held back, expelled, or required to pass a board examination until the completion of elementary education.

  40. Quality of Education Role of govt bodies (UGC, AICTE, MCI etc) • Teacher – student ratio • Balance between acads and extra-curricular activities • Rote based teaching • Skill development 75% of technical & 85% of general graduates are unemployable by industries. (WSJ) No Indian university appeared in top 200 (including the IITs). (QS World University Rankings (sept 2011)) The number of students writing CAT 2013 is 2 Lakh (for 3500 seats), GATE 2013 is 12 lakhs (for less than 500 seats), over 5 lakh students for IITJEE 2013, 7.5 lakh for NEET 2013 etc.

  41. Education: Important issues • Fee and Funding • Pvt participation and degree of control • Attracting foreign universities • Limited job opportunities post graduation • Adult Education – Literacy vs Education

  42. Education: Summary • The govt has spent a lot of money on Literacy but to not much avail. • The policy is misdirected – Education and not Literacy should be the target. • Focus on employability and alternately creating more employment opportunities is the ultimate solution to the problem.

  43. Agenda • Poverty • Business Environment • Education • Corruption • Law and Order

  44. Law and Order • Police • Judiciary • Status of women

  45. Police • System of policing is governed by "Police Act of 1861" • Police-population ratio of 120 against global avg. of 270 per one lakh “An average of 50 transfers every month in a state that has around 350 IAS officers...43 IPS officers have been transferred 40 times in their career.” “the bureaucrats should work in close coordination with party leaders or face the music.” - State of affairs in UP Read article “A hell hole for Civil Servants” by Tehelka

  46. Police Reform • Minimum tenures for senior police offices (Station Inspector upwards). • Setting up of a body to decide transfers, postings, promotions and other service related matters of police officers. • Police Complaints Authority at state level to inquire into public complaints against police officers. • Increase in the funding/budgetary allocation for the Police department. • Separate the investigation and law and order functions of the police. • Greater integration of various arms of investigation.

  47. Judiciary • More than 3.7 Crore cases pending at various levels of courts (district, high and Supreme) • High pendency levels at the quasi judicial forums (like MRTP commission, consumer forums, Company Law Board, Administrative tribunals, taxation tribunals etc). “Justice delayed is justice denied.” “Justice should not only be delivered, it should also be seen as being delivered.”

  48. Judicial Reforms • Simplification of the court procedures • Service of summon, recording of evidence, arguments, decision • Suitable changes to categories of laws with high pendency • Dishonored cheques, Motor Accident, Land acquisition, maintenance to dependents • Compounding/amnesty schemes for penalty related offences • Alternative dispute resolution mechanism • Lok Adalat, pre-litigative redressal, expert tribunals and regulators, • Fast-track courts • Use of IT

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