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The Budget session 2013 commenced with the President, Pranab Mukherjee, addressing Parliament on February 21, 2013. The address is a statement of the policy of the government. Yesterday a Motion of Thanks was moved in the Lok Sabha and a detailed discussion took place on the President’s address. (The significance of the President’s speech has been discussed in an article published in the Indian Express.) Below are some legislative and policy items from the agenda of the central government outlined in the speech.
Legislative and policyagenda outlined in President’s addresses between 2009-2012 and their status
Legislation/Policy |
Status |
Legislations mentioned in the President’s Address between 2009-12 |
|
To be introduced | |
Goods and Services Tax | Constitutional Amendment Bill introduced |
The National Food Security Bill | Introduced |
Amend the Land Acquisition Act and enact the Rehabilitation and Resettlement Bill | Introduced |
Sexual Harassment of Women at Workplace (Prevention Prohibition and Redressal) Bill | Passed |
The Whistleblower Bill | Pending |
The Judicial Standards and Accountability Bill | Pending |
The Lokpal and Lokayuktas Bill | Pending |
A model Public Services Law (to cover officials providing important social services and commits them to their duties) | Two bills introduced: the Electronic Services Delivery Bill and the Citizen’s Charter Bill |
The Right to Free and Compulsory Education Bill | Passed |
The National Council for Higher Education Bill | Introduced |
Foreign Educational Institutions Bill | Introduced |
Protection of Children from Sexual Offences Bill | Passed |
The Women’s Reservation Bill | Pending |
The Mines and Minerals (Development and Regulation) Bill | Introduced |
The Public Procurement Bill | Introduced |
The General Anti-Avoidance Rules | Scheduled for 2016[1] |
Amend of RTI Act (to provide for disclosure by government in all non-strategic areas) | To be introduced |
Policy items mentioned in the President’s Addresses between 2009-2012 |
|
National Mission for Female Literacy – all women to be literate by 2013-14 | National Literacy Mission recast in September 2009 to focus on female literacy; as per 2011 census the female literacy rate in India is 65.46%[2] |
Disposal of remaining claims in 2010 under the Scheduled Tribes and Other Traditional Forest Dwellers Act | As on February 28, 2010, 27.16 lakh claims had been filed, 7.59 lakh titles had been distributed and 36,000 titles were ready for distribution;[3] as on July 31, 2012, the number of claims filed for the recognition of forest rights and titles distributed are 32.28 lakh and 12.68 lakh respectively[4] |
Introduction of Minimum Support Price (MSP) for Minor Forest Produce (MFP) being considered | Based on the recommendations of the Committee constituted by Ministry of Panchayati Raj to look into aspects of MSP, Value addition and marketing of MFP in Fifth Schedule Areas, a Central Sector Scheme of MSP for MFP has been contemplated[5] |
Voting rights for Indian citizens living abroad | Bill passed; NRIs can vote at the place of residence mentioned in their passport |
12th Plan target growth 9% with 4% growth for the agricultural sector | GDP grew by 5.4% and the agriculture sector by 1.8% in the first half of the current fiscal year (2012-13) |
Establish national investment and manufacturing zones to promote growth in manufacturing | Under the National Manufacturing Policy, 12 National Investment and Manufacturing Zones are notified, 8 of them along the Delhi Mumbai Industrial Corridor and 4 others at Nagpur, Tumkur, Chittor and Medak |
Strengthening public accountability of flagship programmes by the creation of an Independent Evaluation Office. | Government has approved setting up of an Independent Evaluation Office and the Governing Board will be chaired by Deputy Chairman, Planning Commission |
Unique Identity Card scheme to be implemented by 2011-12 | Bill to give statutory status pending in Parliament; enrollment until February 2013 is approximately 28 crore[6] |
Establishment of National Counter-Terrorism Centre | Proposed launch of NCTC in March 2011 on hold as consultation with states is on; meeting held by the union government with the Chief Ministers of all the States in May 2012 |
Conversion of analog cable TV system to digital by December 2014 | Government has implemented the first phase of digitization in Kolkata, Delhi, Chennai and Mumbai; by March 31, 2013, 38 cities with a population of more than one million will be covered |
A roadmap for judicial reform to be outlined by the end of 2009 and implemented in a time-bound manner | Vision statement formulated in 2009 outlining road map for improving justice delivery and legal reforms and steps to reduce pendency in Courts; setting up of a National Mission for the Delivery of Justice and Legal Reforms to improve court administration and reduce pendency was approved in June 2011 |
*Introduced means introduced in one House; Pending means passed by one House and pending in the other House; Passed means passed by both Houses of Parliament.
[1] “Major Recommendations of Expert Committee on GAAR Accepted”, Press Information Bureau, Ministry of Finance, January 14, 2013.
[2] Lok Sabha, Starred Question No. 175, December 5, 2012, Ministry of Human Resource Development.
[3] Lok Sabha, Unstarred Question No. 2672, March 12, 2010, Ministry of Tribal Affairs.
[4] Lok Sabha, Starred Question No. 108, August 17, 2012, Ministry of Tribal Affairs.
[5] “PM approves Constitution of National Council for Senior Citizens”, Press Information Bureau, February 1, 2012, Prime Minister’s Office.
"No one can ignore Odisha's demand. It deserves special category status. It is a genuine right," said Odisha Chief Minister, Naveen Patnaik, earlier this month. The Odisha State assembly has passed a resolution requesting special category status and their demands follow Bihar's recent claim for special category status. The concept of a special category state was first introduced in 1969 when the 5th Finance Commission sought to provide certain disadvantaged states with preferential treatment in the form of central assistance and tax breaks. Initially three states Assam, Nagaland and Jammu & Kashmir were granted special status but since then eight more have been included (Arunachal Pradesh, Himachal Pradesh, Manipur, Meghalaya, Mizoram, Sikkim, Tripura and Uttarakhand). The rationale for special status is that certain states, because of inherent features, have a low resource base and cannot mobilize resources for development. Some of the features required for special status are: (i) hilly and difficult terrain; (ii) low population density or sizeable share of tribal population; (iii) strategic location along borders with neighbouring countries; (iv) economic and infrastructural backwardness; and (v) non-viable nature of state finances. [1. Lok Sabha unstarred question no. 667, 27 Feb, 2013, Ministry of Planning] The decision to grant special category status lies with the National Development Council, composed of the Prime Minster, Union Ministers, Chief Ministers and members of the Planning Commission, who guide and review the work of the Planning Commission. In India, resources can be transferred from the centre to states in many ways (see figure 1). The Finance Commission and the Planning Commission are the two institutions responsible for centre-state financial relations.
Figure 1: Centre-state transfers (Source: Finance Commission, Planning Commission, Budget documents, PRS)
Planning Commission and Special Category The Planning Commission allocates funds to states through central assistance for state plans. Central assistance can be broadly split into three components: Normal Central Assistance (NCA), Additional Central Assistance (ACA) and Special Central Assistance. NCA, the main assistance for state plans, is split to favour special category states: the 11 states get 30% of the total assistance while the other states share the remaining 70%. The nature of the assistance also varies for special category states; NCA is split into 90% grants and 10% loans for special category states, while the ratio between grants and loans is 30:70 for other states. For allocation among special category states, there are no explicit criteria for distribution and funds are allocated on the basis of the state's plan size and previous plan expenditures. Allocation between non special category states is determined by the Gadgil Mukherjee formula which gives weight to population (60%), per capita income (25%), fiscal performance (7.5%) and special problems (7.5%). However, as a proportion of total centre-state transfers NCA typically accounts for a relatively small portion (around 5% of total transfers in 2011-12). Special category states also receive specific assistance addressing features like hill areas, tribal sub-plans and border areas. Beyond additional plan resources, special category states can enjoy concessions in excise and customs duties, income tax rates and corporate tax rates as determined by the government. The Planning Commission also allocates funds for ACA (assistance for externally aided projects and other specific project) and funds for Centrally Sponsored Schemes (CSS). State-wise allocation of both ACA and CSS funds are prescribed by the centre. The Finance Commission Planning Commission allocations can be important for states, especially for the functioning of certain schemes, but the most significant centre-state transfer is the distribution of central tax revenues among states. The Finance Commission decides the actual distribution and the current Finance Commission have set aside 32.5% of central tax revenue for states. In 2011-12, this amounted to Rs 2.5 lakh crore (57% of total transfers), making it the largest transfer from the centre to states. In addition, the Finance Commission recommends the principles governing non-plan grants and loans to states. Examples of grants would include funds for disaster relief, maintenance of roads and other state-specific requests. Among states, the distribution of tax revenue and grants is determined through a formula accounting for population (25%), area (10%), fiscal capacity (47.5%) and fiscal discipline (17.5%). Unlike the Planning Commission, the Finance Commission does not distinguish between special and non special category states in its allocation.