Power Supply To Rural India Program

 

Power Supply To Rural India Program

• Government of India has launched the scheme “Deendayal Upadhyaya Gram Jyoti Yojana” for rural electrification to provide continuous power supply to rural India in 2015. The erstwhile Rajiv Gandhi Grameen Vidyutikaran Yojana (RGGVY) scheme for village electrification and providing electricity distribution infrastructure in the rural areas has been subsumed in the DDUGJY.
• Rural Electrification Corporation is the Nodal Agency for implementation of the DDUGJY.
• Under the scheme, 60% of the project cost (85% in the case of special states) is provided as grant by GOI and additional grant up to 15% (5% in the case of special category states) is provided on achievement of prescribed milestones.
• The International Energy Agency (IEA), 2018 has acknowledged that India’s move to energize every village in the country with electricity is one of the greatest success stories in the world in 2018.

Development Of Dryland Farming

A centrally sponsored scheme of Integrated Dry Land Agricultural Development was launched in 1970-71, in 24 pilot projects. The objective of the scheme was to test and demonstrate the technology developed by the All -India Co-ordinated Research Project for Dryland Agriculture, under the Indian Council for Agricultural Research (ICAR).

The major components of watershed development were:

• Land development,
• Construction of water harvesting storage,
• Coverage of area with improved/drought resistant seeds and fertilizers.

The National Watershed Development Project for Rainfed Areas (NWDPRA) initiated in the Sixth Plan envisaged that a micro watershed would be taken up for development in every block having assured irrigation of less than 30%.

Soil And Water Conservation

• Soil conservation is a measure undertaken in order to prevent soil loss from erosion or reduced fertility, caused by over usage, acidification, salinization or other chemical soil contamination.
• Techniques adopted for improved soil conservation include practices like crop rotation, cover cropping, conservation tillage and planted windbreaks (linear planting of trees and shrubs in a designed way), etc.
• The National Water Policy (NWP), 2012 serves as a policy guideline, for development and management of water resources, in the country.
• It has emphasized on their implementation through the National Water Board, by preparing a plan of action. The Ministry of Water Resources, River Development and Ganga Rejuvenation, is responsible for conservation, management and development of water, research and development, training and matters relating to irrigation and multi-purpose projects

Pradhan Mantri Krishi Sinchayee Yojana (PMKSY)

• It is being implemented with the objective of developing a long- term solution for mitigating the effect of drought and increasing area under irrigation with motto of ‘Har Khet Ko Pani’.
• The scheme has been conceived amalgamating the Accelerated Irrigation Benefit Program (AIBP) of the Ministry of Water Resources, River Development & Ganga Rejuvenation (MoWR, RD&GR), Integrated Watershed Management Program (IWMP) of Department of Land Resources (DoLR) and the On Farm Water Management (OFWM) of Department of Agriculture, Cooperation and Farmers Welfare.
• The major objective of PMKSY is to achieve convergence of investments in irrigation at the field level, expand cultivable area under assured irrigation, improve on farm water use efficiency to reduce wastage of water, enhance the adoption of precision irrigation and other water saving technologies.

Rural Infrastructure Development Fund

The Fund was instituted with an initial corpus of Rs. 2,000 crore, by way of deposits to be placed with NABARD by commercial banks to the extent of their respective shortfalls in agriculture lending, under priority sector.

At present, there are 37 eligible activities under RIDF as approved by GOI. The eligible activities are classified under three broad categories i.e.,

• Agriculture and related sector
• Social sector and
• Rural connectivity.

The project for rural connectivity, social and agri-related sector, are eligible for loans to the extent of 80% to 95% of project cost.

Loans availed under RIDF are to be repaid in equal annual instalments within seven years from the date of withdrawal, including a grace period of two years. The interest shall be paid at the end of each quarter. The implementation phase for projects sanctioned under the Fund is spread over two to five years, varying with the type of the project and also location of the state.

Economic Reforms

Macroeconomic Stabilization

The key policy reforms introduced in this area were fiscal-monetary policy reforms. These were aimed at:

• Providing a better balance between aggregate demand and supply
• Minimizing the distortion effects of the tax system
• Forcing public enterprises to minimize cost and maximize efficiency.

Government’s expenditure was concentrated in two areas:

• Consumption expenditure, and
• Subsidy payments.

In order to generate additional revenue, government planned to broaden tax base, rationalize tax rates and improve collection through non-tax sources.

Structural Reforms

Comprehensive structural reforms have been undertaken to improve the supply-side of economy. Among them the important ones were: (i) Trade and capital flows reforms, (ii) Industrial deregulation, and (iii) Public sector reforms.

Trade and Capital flow Reforms:

• Government initiated a number of trade policy changes, with a view to integrating the Indian economy better, with the rest of the world. The value of rupee was adjusted downward by about 20 per cent in July 1991.
• The other measures included the convertibility of the rupee first on trade account and then on entire current account transaction, liberalization of import regime, substantial lowering in customs tariff rates, measures to promote exports.

Industrial Deregulation:

• Historically, domestic economic activities in India were subjected to a wide-ranging government control measure. In the industrial sector, such controls took various forms like industrial licensing, which acted as a barrier to entry, reservation of a large number of industries, for the public sector and for the small-scale sector, time consuming procedures required for the exit of firms from an industry and price and distribution control on various industrial products. The thrust of new industrial policy announced in July, 1991 was on removing these controls

Public Sector Reforms

• Since the public sector was not generating enough internal resources and becoming a constraint on economic growth, the government adopted a new approach viz. provision of greater managerial autonomy to public enterprises to enable them to work efficiently; encourage private sector competition in areas where social considerations are not paramount; and provide market orientation to the public sector through the disinvestment process.

Financial Sector Reforms

A committee under the chairmanship of Shri M. Narasimham was set up to examine the country’s Financial System and the committee submitted its report in December 1991. The Committee, recommended

• Gradual reduction of the reserve requirements to be maintained by banks (both SLR and CRR)
• Redefining the priority sector and phasing out the directed lending programs
• Interest rate determination on the grounds of market forces such as demand for and the supply of fund
• Structural reorganization of the banking sector
• Establishment of ARF tribunal, to ease the problems of NPAs in banks
• Provision of autonomy to the public sector banks
• Adoption of uniform accounting practices, particularly, in regard to income recognition and provisioning against doubtful assets and making full disclosures in the balance sheets
• Rationalization of operations of foreign banks.

Following acceptance of the report by GOI, the following actions were initiated:

• SLR and CRR were reduced from 38.5 per cent to 25 per cent and from 15 per cent to 10 per cent respectively.
• The RBI introduced prudential norms for income recognition, classification of assets and provisioning for bad debts for the first time.
• The banks were required to maintain capital equivalent to 8 per cent of their risk weighted assets.
• Commercial banks which had met certain stipulated conditions were allowed to open new branches without the approval of the RBI. They were also permitted to close down non-viable branches other than those in rural and semi-urban areas.
• Interest rates of commercial banks on loans above Rs. 2 lakhs were fully deregulated.
• Interest rates on advances of all Co-operative banks and Regional Rural Banks were deregulated.

Impact of Reform In Rural Economy

The impact of reforms on rural economy is discussed in the following five important areas

• Flow of credit for agriculture and rural development
• Investment in agriculture
• Input subsidies
• Agricultural exports
• Poverty alleviation and employment generation programs