This is a well-rounded budget that promises to accelerate growth on a sustainable basis and transform the lives of hundred of millions of Indian citizens. While the rest of the global economy has been decelerating, India has continued to accelerate. The Budget will reinforce this trend in the Indian economy.
Rajiv Kumar's blog
It is generally agreed that a key element in the transformation of India is the creation of a large number of good jobs. While micro and small enterprises provide lots of jobs, consistent with their low productivity, they pay relatively low wages. For example, according to recent research by Rana Hasan and Nidhi Kapoor of the Asian Development Bank (ADB), manufacturing firms with less than 20 workers each employed 73% of manufacturing workforce but produced only 12% of manufacturing output in 2010-11, the latest year for which such data are available.
The Forest Act of 1927 and Forest Conservation Act of 1980 offer a good example of how good intentions can sometimes lead to unintended adverse outcomes. Under the 1927 Act, the erstwhile Punjab state (which was split into the current states of Punjab and Haryana in 1966) has had a history of declaring the avenue plantations on either side of the roads, canals and Railways as Protected Forest going as far back as 1958. The Revenue Department of the then Punjab Government made the decision and transferred the strips of plantations to Forest Department for management.
In his parting speech to the erstwhile Planning Commission on 30th April 2014, the then Prime Minister Manmohan Singh had stated, “Are we still using tools and approaches which were designed for a different era? Have we added new functions and layers without any restructuring of the more traditional activities in the Commission?” Therefore, when Prime Minister Narendra Modi announced in his maiden Independence Day address on 15th August 2014 that he intended to replace the Planning Commission by a new body, he was giving expression to a shared sentiment.
At a time when environmental degradation was hardly an issue, Mahatma Gandhi had famously said that earth provided enough to satisfy every man's need, but not his greed. India has therefore rightly chosen the birth anniversary of the Mahatma to announce its Intended Nationally Determined Contributions (INDCs) to combat climate change.
With the lapse of the ordinance amending the Land Acquisition Act, 2013, it is an opportune time to take a fresh look at the land acquisition issue and look for ways forward. I begin with some clarifications.
Land leasing laws relating to rural agricultural land in Indian states were overwhelmingly enacted during decades immediately following the independence. At the time, the abolition of Zamindari and redistribution of land to the tiller were the highest policy priorities. Top leadership of the day saw tenancy and sub-tenancy as integral to the feudal land arrangements that India had inherited from the British.
There can be little disagreement that the fastest relief to the poor in India would come from productivity growth in agriculture. This is where nearly half of the workforce is employed. With the share of agriculture in the GDP at about 15 percent now, this half of the workforce is also significantly poorer than the other half, employed in industry and services.