Niti Aayog meet: States to get greater say in new national planning regime

New Delhi: Prime Minister Narendra Modi and state chief ministers on Sunday considered a new approach in policy planning that aims to give states a greater say in determining national priorities—including in internal security and defence—set out in a 15-year vision and a draft three-year short-term action plan ending 2019-20.
The vision document and the draft 300-point action plan prepared with suggestions from states and gram sabhas rest upon the spirit of cooperative federalism that succeeds the Nehruvian era’s centralized five-year planning that drew to a close on 31 March with the end of the 12th five year plan. They were discussed as part of the Niti Aayog’s third governing body meeting. The vision document projects the economy to grow more than three-fold to Rs469 lakh crore by 2031-32, from Rs137 lakh crore in 2015-16, assuming an 8% annual growth.
“Niti Aayog is a collaborative federal body whose strength is in its ideas, rather than in administrative or financial control,” an official statement quoted Modi as saying in his opening remarks to the think tank. He promised states that regional growth imbalance will be addressed both nationally and within states. The Prime Minister also suggested that states should take the lead in changing the financial year to January-December and “carry forward the debate and discussion on simultaneous elections.” The idea is better economic and political management of the country. Modi also urged states to put in place State Goods and Services Tax (SGST) laws without delay and to speed up capital expenditure and infrastructure creation.
Niti Aayog tweeted that the long-term national development agenda up to 2031-32 extend the traditional plan mandate to include internal security and defence. By 2031-32, the country should be “highly educated, healthy, secure, corruption-free, energy abundant, environmentally friendly and globally influential,” it said.
Niti Aayog vice-chairman Arvind Panagariya told reporters after the meeting that the action plan assesses the revenue available to the union and state governments over the next three years to suggest enhanced spending on priority areas like health, infrastructure, agriculture and rural economy. The action plan will be finalized after states give their feedback.
The governing body also reviewed the progress in drafting a Regulatory Reforms Bill, a model Agriculture Land Leasing Act, changes to the Agricultural Produce Marketing Committee Act, a national energy policy and strategic disinvestment of state-owned enterprises.
Madhya Pradesh chief minister Shivraj Singh Chouhan made a presentation on doubling of farmers’ income, by focusing on irrigation, technology generation and dissemination, market reforms and livestock productivity.
The short-term action plan coincides with the remaining three years of the 14th Finance Commission’s award period ending in 2019-20 as it gives certainty on the cash flow of central and state governments for the period.
Shaping the country’s development plan with state governments consolidates the resetting of centre-state relations under the co-operative federalism achieved through higher untied fund allocation to states from the centre’s divisible pool of taxes (without specifying end-use) and the setting up of the goods and services tax (GST) Council, in which neither the Union nor the state governments can take decisions without the support of the other.
GST reflects the spirit of “one nation, one aspiration, one determination,” Modi said. He said that the share of central funds to states that are tied to specific central projects have come down from 40% of total allocation in 2014-15 to 25% in 2016-17 with a corresponding increase in funds which are not linked to specific schemes, giving states greater freedom in their utilization.
The meeting also reviewed Niti Aayog’s move to encourage states to excel in various governance parameters by comparing performance.
Experts welcomed the move to foster competition among states.
“Competitive federalism is a very good strategy. Comparing states on ‘ease of doing business’ is a good first step. Now states must be compared on the pace at which they are creating jobs and livelihoods, improving health and education for citizens, and developing local governance capabilities,” said Arun Maira, former member of the Planning Commission.
Modi said it was the collective responsibility of the gathering to envision the India of 2022—the 75th anniversary of independence—and see how the country could swiftly move forward the goals set in the vision document.
The prime minister told states that advancing of the Union budget date to 1 February in 2017 from the customary last day of the month was meant to make funds available for various schemes so that they could be utilized in time, especially for farming before the monsoon arrived. Dropping the distinction between plan and non-plan spending has enabled the authorities to focus on welfare spending, Modi said.

Make in India gets metro boost; local procurement made mandatory

New Delhi: With rapid expansion of metro rail projects in the country, Ministry of Urban Development has taken several far reaching decisions to promote Make in India campaign. These include stipulating certain mandatory conditions to be incorporated in Tender Documents of metro companies for procurement of metro cars and related critical equipment and sub-systems, procurement of only Made in India signaling equipment besides standardizing technical parameters for rolling stock (metro coaches) and signaling equipment.
The new mandatory Tender Conditions and standardized norms for a wide range of equipment, approved by the Minister of Urban Development Shri M.Venkaiah Naidu have been circulated to all the metro companies on Friday this week making them effective immediately.
These initiatives will incentivize setting up manufacturing facilities in the country by increasing the volumes of procurement of rolling stock and all kinds of equipment by removing variations in the present technical norms for rolling stock and signaling equipment. This will in turn result in reduction of cost through economies of scale.
The Ministry has stipulated the following mandatory conditions to be incorporated in Tender Documents:
1. Minimum 75% of the tendered quantity of metro cars shall be manufactured indigenously with progressive indigenization of content, for which the contractor may either establish independent manufacturing facility in India or partner with Indian manufacturers, if the procurement is more than 100 cars;
2. To facilitate ease in maintenance through easy availability of spares beyond the warranty period, an identified list of critical equipment and sub-systems shall be included in the Tender Document for ensuring indigenous manufacturing of a minimum of 25% of such equipment, either by Original Equipment Manufacturers themselves by establishing a wholly owned subsidiary in India or through Indian manufacturers;
3. Requirement of metro cars at State level shall be clubbed to enable applicability of local procurement norms; and
4. To develop in-house expertise on long term basis, metro companies with large size fleet to undertake in-house maintenance.
A total number of 1,912 metro coaches are currently operational in the country with another 1,420 under procurement. Over the next three years more than 1,600 metro cars would be required. Each metro coach is estimated to cost about Rs.10 cr.
The Ministry has concluded the long pending standaridisation of norms for rolling stock and signaling equipment applicable to over 90% of the present imports. Further, to promote indigenous manufacturing, the Ministry has stipulated procurement of 9 types of signaling equipment from within the country. Metro companies have also been directed to develop maximum possible local competence so that knowhow and technical support is available within the country. Indian companies have to be associated with production of a wide range of signaling and train control project equipment.
Indigenization of several metro functions has also been prescribed. These relate to communication systems, managing operational disturbances, time table preparation, fault reporting, control traction power, maintenance, infrastructure supervision, rolling stock management etc.
The new standardized norms prescribe that the rolling stock and related equipment and systems shall enable Unattended Train Operations, Driverless Train Operations, Standard rail gauge of 1,435 mm, Metro cars with body width of 2.90 meters for passenger capacity of up to 45,000 Peak Hour Peak Distance capacity, body width of 3.20 meters for capacity above 45,000 PHPD, only 3 car, 6 car or 9 car rail combination, operational speed of 80 kmph, minimum 67% motorization for all rolling stock etc. Norms have also been prescribed for Acceleration Rates, Energy Consumption, Noise and Vibration levels, Collision Standards etc.
Further to these initiatives, Ministry of Urban Development will soon evolve common eligible criteria for suppliers of rolling stock and other equipment doing away with the present variations across different metro companies.
Shri Rajiv Gauba, Secretary(UD) discussed with Managing Directors of metro companies on Friday the variations in the present eligibility criteria. Noting that such variations adversely impact competition, he directed that a broadly uniform criteria in respect of Net Worth, Financial and technical capacities and experience of supply of rolling stock and other equipment etc should be evolved in two weeks.
Presently, metros are operating in 7 cities of Delhi, Kolkata, Mumbai, Jaipur, Gurgaon, Bengaluru and Chennai with a total route length of 326 kms. Metro projects with a total route length of 546 kms are under construction in 11 cities and projects with a total route length of 903 kms in 13 cities are under consideration.

Isro plans to mine energy from Moon by 2030 to help meet India needs

New Delhi: From launching 104 satellites at one go, enabling commercial roll out of lithium-ion batteries, to taking the lead in providing energy security, the Indian Space Research Organization (Isro) is firing on all cylinders.
Apart from planning for manned missions to Moon, Mars and even aircraft development, Isro is now working on a plan to help India meet its energy needs from the Moon by 2030.
The premier space agency, credited with launching 225 satellites till date, plans to mine Helium-3 rich lunar dust, generate energy and transport it back to Earth.
This comes in the backdrop of successful testing of lithium-ion batteries developed by Vikram Sarabhai Space Centre by the Automotive Research Association of India (Arai). This is expected to provide a fillip to India’s electric vehicles (EV) push. The government is now planning to transfer the technology to companies for commercial production of these batteries, reported Mint.
Isro’s lunar dust mine plans were revealed by Dr Sivathanu Pillai, professor at the space agency, in February.
Speaking at a conference in New Delhi, Pillai, former chief of BrahMos Aerospace, said that mining lunar dust was a priority programme for his organisation.
In a written reply to the Lok Sabha on 29 March, minister of state in charge of atomic energy and space Jitendra Singh said, “Technology is ready for transfer to Indian industries for undertaking the production of Li-ion batteries. BHEL has expressed interest in the transfer of technology.”
This lunar dust mining plan comes in the backdrop of India’s plan to cut down import dependence in hydrocarbons by 10 percentage points by 2022. India’s energy demand growth is expected to outpace that of the other Bric (Brazil, Russia, India and China) countries, according to the latest BP Energy Outlook.
Isro’s success on this front will also help reduce pollutants and India’s fuel imports. This assumes significance given India’s energy import bill of around $150 billion, which is expected to reach $300 billion by 2030. India imports around 80% of its oil and 18% of its natural gas requirements. India imported 202 million tonnes of oil in 2015-16.

Rural Electrification eyes Rs10,000 crore renewables lending push

New Delhi: Rural Electrification Corp (REC), a government-owned company backing India's power sector, is planning to triple its lending in the clean-energy sector by setting aside about Rs 10,000 crore (US$ 1.5 billion) for financing renewable energy projects, evacuation infrastructure and equipment manufacturers in FY 2017-18.
Mr P V Ramesh, Chairman, REC stated that the company plans to mobilize resources via green bonds in Europe and social impact bonds in Scandinavia. The company is also interested in investing in Tesla Inc, electric vehicles manufacturer, if it enters the Indian market. REC's lending shift to clean energy is influenced by Prime Minister of India, Mr Narendra Modi's vision of 175 gigawatts (GW) of renewable capacity addition by 2022.

Shipping firms to benefit from rising iron ore exports to China

Mumbai: scenario in terms of volumes and freight rates, having improved on the India-China route, shipping firms are increasingly deploying large sized-vessels there.
“Until September-October last year, there was not a single vessel getting loaded for China. But in the last few weeks, about eight to 10 vessels have been loaded at Goa to get shipped to China," said Captain Kiran Kamat, managing director at Link Shipping and Management Systems.
“In coming months, a maddening rush is expected on this route as all iron ore exports will have to be done by June, before the monsoon halts activities for over three-four months," he added.
Unlisted Essar Shipping carried dry bulk cargo of almost 11.5 million tonnes (mt) in 2016-17, up 18 per cent from the previous financial year, the company said in a release last week. More than 80 per cent of the Essar Shipping fleet carries dry bulk cargo, which includes iron ore, coal, bauxite and limestone.
“Our deployment of Supramax- and Panamax-sized vessels on this route depends on the availability of vessels. I agree there is some improvement in freight rates and volumes have picked up, but it’s too early to say if these rates are sustainable," a senior official with Shipping Corporation of India (SCI) told Business Standard.
The SCI is the largest shipping company in the country, with a fleet size of 69 vessels, of which 16 vessels belong to the dry bulk division. Essar Shipping, on the other hand, has a fleet of 14 vessels.
In the first nine months ended December 31, 2016, the SCI witnessed a loss of 171 crore in its dry bulk earnings, compared to 108 crore in the same period the previous year.
Apart from the SCI and Essar Shipping, Great Eastern Shipping is another big shipping company in the domestic market. However, industry officials are of the view that Great Eastern Shipping may not be too active on the India-China route as most of its vessels are deployed on foreign waters on medium- to long-term contracts.
Between February 2016 and March 2017, the Baltic Dry Index, a key indicator for freight rates, shot up four times from a low of 290 to 1,300.
“Iron ore exports are about 10 mt already between January and March, and we expect this figure to touch 40 mt this year. This will also push up freight rates, and hence Baltic is seen moving in the upward direction here on," said Rahul Sharan, lead research analyst with Drewry, a maritime research and consulting firm. He refrained from giving a level for the Index.
India exported 21.41 mt iron ore in 2016 from a meagre 4 mt in 2015. India was the world’s third largest iron ore exporter after Australia and Brazil before the government banned the exports in 2011. The ban was lifted in 2014. Prior to the ban, India had shipped more than 100 mt of the commodity, mainly to China in the form of fines.

Govt eases norms for states to fund infrastructure projects

New Delhi: In a move that will potentially improve India’s infrastructure funding options, the cabinet on Wednesday allowed state government entities to directly tap bilateral agencies for resources.
Not only will this give greater flexibility to state entities to fund infrastructure projects, it will also enable state governments to move some debt off their books.
The new fundraising route will allow for direct borrowing by state public sector undertakings (SPSUs) from Official Development Assistance (ODA) partners in countries like Japan, the US and Germany.
While such a dispensation is available to central public sector units, it wasn’t available for SPSUs, thereby exhausting state governments’ borrowing limits.
Also, these infrastructure projects are long-gestation projects requiring loans with a long tenure.
As part of this new mechanism, Mumbai Metropolitan Region Development Authority will be allowed to borrow directly from the Japan International Cooperation Agency a Rs15,109 crore loan to implement the Rs17,854 crore Mumbai Trans Harbour Link project.
Currently, if an SPSU has to avail of such loans, it has to be facilitated by the respective state government, with such borrowing reflecting on its books. Also, it has to be limited to 3% of gross state domestic product (GDP).
“It reduces the state government’s resources for development spending,” finance minister Arun Jaitley said at a press conference.
As per Wednesday’s cabinet decision, eligible state entities can borrow directly with a government guarantee, which frees up the state’s borrowing space, Jaitley explained.
According to the N.K. Singh panel which reviewed India’s fiscal rules, “The states’ combined primary deficit of around 1.3% of GDP is much higher than the centre’s primary deficit of 0.3% of GDP in 2016-17 (BE). This implies that the combined debt of the states is projected to rise even if they adhere to their FRBM (fiscal responsibility and budget management) targets.”
The panel has recommended a debt-to-GDP ratio of 38.7% for the central government, 20% for state governments together and a fiscal deficit of 2.5% of GDP by financial year 2022-23.
India plans to invest as much as Rs3.96 trillion in the current financial year to bankroll its new integrated infrastructure planning paradigm comprising roads, railways, waterways and civil aviation.
While the concerned state government will furnish a guarantee for the loan, the Union government will provide the counter-guarantee.
“This dispensation will allow the financially sound state entities to directly borrow and repay the loan required for major infrastructure projects without burdening the state exchequer,” a government statement said.
Experts welcomed the move.
“With this move, more vibrant federalism is being brought in where state decides for its own finances...This move gives more responsibility and freedom to the state government. Responsibility and freedom go hand-in-hand with the rider that if they become frivolous in managing their finances, then it will hit India’s balance of payment,”said Jaijit Bhattacharya, partner, infrastructure and government services, at consulting firm KPMG.
It’s a positive step in simplifying the process of financing by bilateral agencies, said Sanjay Garg, partner and leader, capital projects, at PricewaterhouseCoopers.
“This will put more onus on the states to assess viability of projects. There has to be some checks in place to prevent this from becoming a channel for off-budget borrowings, thus circumventing the fiscal prudence requirements,” he added.
Gireesh Chandra Prasad contributed to this story.

Cabinet approves signing of the Protocol amending the Convention between India and Portugal for avoidance of Double Taxation

New Delhi: The Union Cabinet chaired by the Prime Minister Shri Narendra Modi has given its approval for signing of a Protocol amending the Convention between India and Portugal for avoidance of double taxation. The Protocol will also ensure prevention of fiscal evasion with respect to taxes on income.
Once the Protocol enters into force, both India and Portugal would be able to exchange tax related information, which will help tax authorities of both countries to curb tax evasion.

GO BACK Rolls-Royce opens defence service delivery centre in India

New Delhi: Aircraft engine maker Rolls-Royce Holdings Plc on Thursday opened a new defence service delivery centre (SDC) in Bengaluru, the first outside the US and UK, to provide localized engineering support and solutions and reduce turnaround time for the Indian Air Force, Indian Navy and state-owned Hindustan Aeronautics Ltd (HAL).
Rolls-Royce is looking to improve capability and provide faster front-line support for over 750 engines in a range of aircraft used by the defence as well as commercial aircraft such as the C-130J, Hawk advanced jet, Embraer and Jaguar, among others.
Shaun Agle, vice-president (customer services), India defence, said the new service delivery centre will be able to deliver real-time solutions through MRO (maintenance repair and overhaul), provide first and second line of support, have field service representatives, manage the health of the fleet, manage supply chains and collaborate with the armed forces.
India is the last remaining user of the Jaguar type of aircraft and is one of the largest users of the Hawk, the company said, while trying to highlight the need for a local presence.
The SDC will have at least 10 specialized engineers and service personnel to find localised solutions specific to India. The SDC is based on the model operated by the company at Marham in the UK and Kingsville in the US.
The company did not quantify the reduction in time or cost that would result from setting up the local SDC, which will do the work that would otherwise have been referred to Bristol, UK.
Last year, Indian customers raised 138 issues, according to the company, which were referred to Bristol.
Rolls Royce has over 1,600 engineers based in India who help provide solutions for the UK-based company’s global customers, Kishore Jayaraman, president, India and South Asia, said.

Disinvestment for 2017-18 kicks off with Rs 1,200 cr Nalco share sale

New Delhi: Overwhelming response from retail investors in the share sale of National Aluminium Company helped the government kick off the new financial year’s disinvestment programme.
Small investors bid 3.2 times over while high-networth individuals and institutional buyers bid 1.8 times more for the Nalco shares, stock exchange data showed.
The government mopped up Rs 1,204 crore--Rs 250 crore from retail and Rs 954 crore from institutions--by selling 9.2% in Nalco.
Commenting on the Nalco share sale, the secretary at the Department of Investment and Public Asset Management (DIPAM), Neeraj Gupta, said the government was confident of retail investor demand and hence had exercised the green-shoe option keeping in mind the last four disinvestments. “Today’s response validates our market assessment.”
The government has drawn up plans to sell stakes in more than 20 companies, including Indian Oil Corp, National Thermal Power Corp, Rural Electrification Corp, Power Finance Corp, Neyvelli Lignite Corp and NHPC, to raise Rs 72,500 crore during 2017-18.
Apart from the blue-chip stocks, the government also has plans for listing 16 state-owned companies.
The process has started for appointing legal advisers and merchant bankers for Rail Vikas Nigam Ltd, IRCON International Ltd, Indian Railway Finance Corporation Ltd, Indian Railway Catering and Tourism Corporation Ltd, RITES Ltd, Bharat Dynamics Ltd, Garden Reach Shipbuilders & Engineers Ltd, Mazagon Dock Shipbuilders Ltd (MDSL), North Eastern Electric Power Corp, MSTC Ltd and Mishra Dhatu Nigam Ltd.
The government has plans to list five state-owned insures—New India Assurance Company Ltd, United India Insurance Company Ltd, Oriental Insurance Company Ltd, National Insurance Company Ltd, and General Insurance Corporation of India.
The government has set a target of Rs 46,500 crore through small stake sales and Rs 15,000 crore from strategic disinvestment during 2017-18.
The finance ministry is planning to step up disinvestment as it has to spend more on infrastructure and social schemes while cutting the fiscal deficit to 3.2% of GDP in 2017-18, from 3.5% last year.

Legal Aid and Empowerment initiatives launched

New Delhi: Minister of Law & Justice and Electronics & IT, Sh. Ravi Shankar Prasad today appealed to all those involved in the delivery of justice to join hands in improving the system to ensure that assistance is available to every citizen irrespective of his socio-economic position. He said this after the launch of three key legal aid and empowerment initiatives of the Department of Justice – including ‘Pro bono legal services’, ‘Tele law service’ and ‘Nyaya Mitra scheme’. The Minister also mentioned that the country’s legal system would be digitally transformed, as digital inclusion holds the key to the country’s march towards Digital India.
The Minister emphasized the need for increased opportunities of legal aid and awareness for people, especially the marginalised sections of the society. He said that the three initiatives launched today were aimed at fulfilling the department’s core mandate of enhancing ‘access to justice’ for the poor and vulnerable communities, including making accessible quality and effective legal aid for them. He acknowledged and appreciated the initiatives undertaken, over the last two decades, to safeguard and deliver this right to citizens, first, by the National Legal Services Authority (NALSA) and subsequently by the Department of Justice – both of whom have the shared mandate of delivering adequate and efficient legal aid to the marginalised and vulnerable sections. The Minister also underscored that the initiatives launched by the department here are to supplement the efforts of NALSA and not to overlap the activities undertaken by the legal services authorities.
Pro bono legal Services
The ‘Pro bono legal services’ initiative is a web based platform, through which interested lawyers can register themselves to volunteer pro bono services for the underprivileged litigants, who are unable to afford it. The Department of Justice has launched the online application for this initiative on its website doj.gov.in. Through this online portal, litigants from marginalised communities (including members of scheduled castes and scheduled tribes, women, children, senior citizens, persons with low income and persons with disabilities) can also apply for legal aid and advice from the pro bono lawyers.
The Minister described this effort as an ‘earnest step’ towards fulfilling the mandate of quality legal aid for all. He noted that many from the legal fraternity were already volunteering legal support for the underprivileged clients, in an individual capacity. However, he stressed that the time has come to promote the concept of pro bono legal aid in an institutionalized manner and ensure that those who volunteer their valuable time and service towards this public service are duly recognized.
The Minister called upon all lawyers from across the country to wholeheartedly support this initiative and help in fulfilling the constitutional mandate of legal aid for all.
Tele Law: Mainstreaming Legal Aid through Common Service Centre
Through the second initiative, launched by the Minister, the Department of Justice and NALSA are partnering with CSC- E- Governance Service Limited for mainstreaming legal aid to the marginalized communities through the Common Service Centers (CSCs). This initiative, called ‘Tele Law’, is aimed at facilitating delivery of legal advice through an expert panel of lawyers – stationed at the State Legal Services Authorities (SLSA). The project would connect lawyers with clients through video conferencing facilities at CSCs, operated by para legal volunteers. For this purpose, this initiative would also play a pivotal role in empowering 1000 women para legal volunteers.
The Minister said that using CSCs for mainstreaming legal aid services for the marginalized at the panchayat levels would ensure that legal aid reaches populations which remained untouched due to geographical challenges and/or lack of infrastructure. He also described the use of CSCs as change agents, enablers of community participation and capacity building in rural settings as commendable.
The project would be launched across 1800 panchayats in Uttar Pradesh, Bihar, North Eastern States and Jammu & Kashmir.
District Facilitation Centre to reduce pendency: Engagement of Nyaya Mitra
The Minister also discussed the issue of heavy pendency of cases in courts across the country. He noted that at present, more than 2.4 crore cases are pending in the district and lower judiciary, of which nearly 10% are more than 10 years old. He called for collective action and efforts in remedying this situation. In this context, the Minister also inaugurated the Nyaya Mitra scheme, which is aimed at reducing pendency of cases across selected districts, with special focus on those pending for more than 10 years.
Functionalized through a retired judicial or executive officer (with legal experience) designated as the ‘Nyaya Mitra’, the project would be operated out of District Facilitation Centres, housed in CSCs. Nyaya Mitra’s responsibilities would include among others assistance to litigants who are suffering due to delay in investigations or trial, by actively identifying such cases through the National Judicial Data Grid, providing legal advice and connecting litigants to DLSA, CSC Tele Law, other government agencies and civil society organisations. He/she shall also refer the marginalized applicants to Lok Adalats for dispute resolution and render assistance towards prison reforms within the district, in coordination with the district judiciary and other stakeholders.
This initiative would be launched in 227 districts including 27 districts from North East and Jammu & Kashmir and 200 districts from Uttar Pradesh, Bihar, Maharashtra, Rajasthan, Odisha, Gujarat, West Bengal etc. and would be operated out of CSCs.
The Minister stated that the department was committed to fulfilling its mandate of securing access to justice through these initiatives and called for support and action for all stakeholders in making them a success.