Total Pageviews

Thursday, August 30, 2012

GCC (Gulf Cooperation Council)

Introduction

The Concept and Foundations

On 21st Rajab 1401 AH corresponding to 25th May 1981, Their Majesties and Highnesses, the leaders of the United Arab Emirates, State of Bahrain, Kingdom of Saudi Arabia, Sultanate of Oman, State of Qatar and State of Kuwait met in Abu Dhabi, United Arab Emirates, where they reached a cooperative framework joining the six states to effect coordination, integration and inter-connection among the Member States in all fields in order to achieve unity, according to article 4 of the GCC Charter. Article 4 also emphasized the deepening and strengthening of relations, links and areas of cooperation among their citizens. The underpinnings which are clearly provided for in the preamble of the GCC Charter, confirm the special relations, common qualities and similar systems founded on the creed of Islam, faith in a common destiny and sharing one goal, and that the cooperation among these states would serve the sublime objectives of the Arab nation.

The decision was not a product of the moment but an institutional embodiment of a historical, social and cultural reality. Deep religious and cultural ties link the six states, and strong kin relations prevail among their citizens. All these factors, enhanced by one geographical entity extending from sea to desert, have facilitated contacts and interaction among them, and created homogeneous values and characteristics.

Therefore, while, on one hand, the GCC is a continuation, evolution and institutionalisation of old prevailing realities, it is, on the other, a practical answer to the challenges of security and economic development in the area. It is also a fulfilment of the aspirations of its citizens towards some sort of Arab regional unity.

Objectives

The GCC Charter states that the basic objectives are to effect coordination, integration and inter-connection between Member States in all fields, strengthening ties between their peoples, formulating similar regulations in various fields such as economy, finance, trade, customs, tourism, legislation, administration, as well as fostering scientific and technical progress in industry, mining, agriculture, water and animal resources, establishing scientific research centres, setting up joint ventures, and encouraging cooperation of the private sector.


INDIA AND GCC  Relations (importance)

1. India is major imoporter of Crude oil and LNG(Liquified Natural Gas) and hence good trade relations are desirable.
2.India is exporter of food,machinery and many other products like milk and agriculture products.
3. Many india NRI's and workers live and work in these countries and their interests,security and foriegn exchange remmitances are important to india.
4.mutual investments in various sectors
5. Strategic and defence interests.

Wednesday, August 29, 2012

FACTS ABOUT PUNJAB RIVER WATER DISPUTE WITH NEIGHBOURING STATES


Going into the archives, reveals that the Indus Waters Treaty was signed between India and Pakistan in 1960, under which water of the Ravi, the Beas and the Sutlej were reserved for exclusive use by India after transition period. But the roots of the inter-State dispute began in 1966, when the Indian Punjab was reorganised. The Reorganisation Act, Section 78, provides for the apportioning of rights and liabilities of the existing State of Punjab among the successor States in relation to the Bhakhra-Nangal project and the Beas project, by agreement entered into by States after consultation with the Centre.
In April 1976, the Centre through a notification ruled that of available 15.2 million acre feet (MAF) of the water of the Sutlej, the Ravi and the Beas, Punjab and Haryana would be allocated 3.5 MAF each. Punjab filed a suit in the Supreme Court against the decision as well as challenged the validity of Section 78 of the Reorganisation Act.
In 1981, while the suit was still pending, the then Prime Minister, Indira Gandhi, convened a meeting of the Chief Ministers of Punjab, Haryana and Rajasthan, on December 31. They inked an agreement according to which the flow series were changed from 1921-45 to 1921-60, resulting in an increase of the available of the Ravi and Beas waters from 15.85 MAF to 17.17 MAF. Punjab withdrew its suit.
On April 8, 1982, Ms. Gandhi broke the ground near Kapuri village of Patiala district to mark the beginning of construction of the Sutlej-Yamuna Link (SYL) canal. On the same day the Shiromani Akali Dal (SAD) along with the State unit of the CPI(M) launched a Morcha against the canal. This metamorphosed into the "Dharam Yudh Morcha" of the SAD from the Akal Takhat in the Golden Temple complex in Amritsar. The agitation assumed violent proportions and Punjab suffered terrorism for almost a decade.
On July 24, 1985 the then Prime Ministers, Rajiv Gandhi, and the SAD chief, Sant Harchand Singh Longowal, signed the Punjab Accord, whose Clause(9) pertained to sharing of river waters.
It was decided to constitute a tribunal headed by a Supreme Court judge. The settlement also stipulated completion of SYL by August 15, 1986.
Later the SAD Ministry in Punjab, headed by the Chief Minister, S.S. Barnala, initiated the construction of SYL. More than Rs. 800 crores was said to have been spent on the project. But no a brick has moved since 1992, when terrorists shot dead two top Engineers and nearly two dozen labourers working on the project.
In 1986, the Union Government set up a tribunal to adjudicate the waters of Ravi and Beas rivers. The Eradi Tribunal, which was constituted in its report of January 30, 1987, made an allocation of water granting the non-riparian States, Rajasthan 8.60 MAF, Haryana 3.83 MAF, Delhi 0.20 MAF. The riparian Punjab and Jammu and Kashmir got 5.00 MAF and 0.65 MAF, respectively.
This was followed by Punjab filing a review application before the Tribunal on August 9, 1987, against the award given by it under Section 5(3) of the Inter-State Water Disputes Act. Interestingly, that application, seeking review, is still pending before the tribunal and the Centre, all these years, as the mandatory technical member on the tribunal could not be appointed.
In 1999, Haryana moved the Supreme Court seeking construction of the SYL canal. Though the court had asked the Centre to intervene between the two States, it did not help.
A judgment that was kept pending was pronounced last year directing Punjab to complete the SYL canal within one year. Punjab filed a review petition, which was finally rejected, as the apex court directed the Union Government to undertake the construction through its agencies.
Punjab argued that while 17.17 MAF was earlier believed to have been available in the Ravi-Beas systems, the 1981-2002 data depicted the flow to be only 14.37 MAF.
While the groundwater in the State is fast receding, any transfer of water to Haryana would render nine lakh acres of irrigated land in Ferozepur, Bathinda, Muktsar, Moga, Mansa and Faridkot districts as barren.

PROBLEMS AND OPPURTUNITIES IN BORDER AREAS OF PUNJAB BY KESAR SINGH AND US RANGNEKAR


A Profile Report on Pre-Project Survey of Border Area Development Programmes
in Punjab
Kesar Singh
U S Rangnekar
Punjab remains a classic example of a fast developing economy with agriculture its
base. The state is a pioneer in ushering in the green revolution in the country. Besides
this, the state has also made remarkable progress in allied sectors like dairy, poultry,
fishery, and also in horticulture and vegetables. The government has been giving
importance to agro- based industries since a period. The state is one of the progressive
states in strengthening the infrastructure, particularly irrigation and power. The
cumulative effect of all this is manifested in the highest per capita income since
reorganization of Punjab in 1966.
   
Punjab, in an area of 50362 sq kms, is one of the smaller states of India. It accounts for
1.5 percent of total area of  the country and 2.4 percent of the population. The state,
triangular, in shape extends from 29o 30’ to 32o 32’ north latitude and 73 55’ to 67 50’
east longitude. Physiographically, the state may be divided into three regions; (i) hilly
tracts (ii) foothills and (iii) flat plains. The forest cover in the state is 6.05 percent of its
total area as against the national average  of 19.4 percent. Punjab’s climate is
continental, semi arid humid. Soils of the  state are sandy and loamy in texture. The
state has developed quite good network of canals and tubewells for crop irrigation and
has a strong institutional structure, too, for providing credit through a multi- tier and
multi- functional system. The state has 69.9 percent literacy,  33.9 percent urban
population and almost 68 years life expectancy.
The state’s economic performance has varied  over different time periods and its
economy is growing at a relatively slower rate in the post- liberalization decade of the
1990s. Due to it, the state has been listed first in terms of per capita income, has lost
the first place to fourth place. Agriculture is still a major contributor to the state
economy, despite its continuously declining  share. Poverty estimates indicate a
declining trend in the country as a whole and in Punjab as well. At present, only two
states of India, Goa and Jammu & Kashmir have poverty level lower than that of
Punjab.
   
The state of Punjab has approximately 553 kms.of international borders with Pakistan,
comprising the districts of Gurdaspur, Amritsar, Tara Taran and Firozepur. The border
district of Firozepur touches Pakistan border on the north, Faridkot and Moga districts at
the east and Muktsar district at south sides. On the north- east, Satluj river separates it
from Kapurthala district and  on the south-west, Ganganagar district of Rajasthan
touches it. The total geographical area of the district is 5303 sq. kms out of which
3258.78 sq.. kms fall under Bet area and 196.63 sq. kms fall under border area. The
topography of the district is even. It is plain of alluvial formation. The district is divided
into three main belts running somewhat parallel to the course of Satluj river. The bet
area of the district is called “Hithar“ having alluvial dark and gray clay. On the south east
side, Rohi and Mukhi plains have light and sandy soil and brackish water. The district
has chestnut brown and desert soil. The district has five tehsils namely Ferozepur,
Fazilka, Abohar, Zira and Jalalabad. Having total population of 17,46,107 the rural-
urban percentage of the district is 74.19 and 25.81 respectively. There are ten
development blocks in district; these are  Abohar, Khuian Sarwar, Fazilka, Jalalabad,
Guru Harsahai, Firozepur, Mamdot, Ghal Khurd, Zira, and Makhu. The district has total
1003 villages.
Gurdaspur district is the northern most district of state of Punjab  and  lies between
north latitude 31- 36’ and 32 – 34’ and east longitude 74 - 24’  and shares common
boundaries with Kathua district of Jammu  & Kashmir.  Chamba and Kangra districts of
Himachal in the north- east, Hoshiarpur district in the south- east, Kapurthala district in
the south, Amritsar district in the south west and Pakistan in the north- west. The
landscape of  Gurdaspur district has varied topography comprising the hilly tract and
Annexure-VI        
      1
   undulating plan. The soils of the district are loamy with clay content below 10 percent.
They contain small quantities  of lime but magnesia content  is high. The soil of the
district is quite alluvial and fertile. The district is divided into three parts by nature, i.e.
sub- mountainous, kandi and plain. The district has five tehsils namely Gurdaspur,
Pathankot, Batala, Dera Baba Nanak and Dhar Kalan. There are total 1463 inhabited
villages. The district has sixteen blocks namely Gurdaspur,  Kalanaur, Dhariwal,
Kahnuwan, Dinanagar, Pathankot, Dhar Kalan, Narot Jaimal Singh, Bamial, Batala,
Fatehgarh Churian and Dera  Baba Nanak, Sri Hargobindpur, Qadian, Sujanpur and
Dorangla. The total population of the district is 21,04,011. The scheduled castes
population in the district is 24.75 percent. The district has 1591 panchayats, 1552
primary, 255 middle,  and 373 higher secondary schools.  The total length of road
network in the district is 3956 kms.
The district of Amritsar is situated in north- western part of the state,  the district touches
the international border in the north- west, in the north- east, the district of Gurdaspur, in
the south- east, the district of Kapurthala and in the south- west the districts of Tarn
Taran. The district is divided into four tehsils namely Amritsar-I, Amritsar-II, Ajnala and
Baba Bakala. It has total 8 blocks,viz.   Ajnala, Chogawan, Harsha Chinna, Jandiala,
Majitha, Rayya, Tarsika and Verka. The  undivided district had an area of 5088 squ.
kms.
The newly carved out district, Tarn Taran,  from Amritsar district,, has 493 revenue
villages. The undivided district had a population of 21,52,182, out of which 48.80
percent was rural and  51.20 urban. Out of total rural population, 34 percent population
is scheduled caste.
 The border areas of India bordering Pakistan, are more hostile than those, bordering
with other countries. The reason has been  that decade long terrorism in Punjab
multiplied various problems of the state, such as illegal migration, drug trafficking, illegal
trade, crime, insurgency, and killing of innocent civilians. In order to check these
problems, more number of security personnel had been continuously deployed. The
people living in border areas have been facing socio- economic problems and
psychological tensions.
The constraints and prospects of the development along the border areas assume
unique significance in the process of planning and development due to specific needs of
the people living in the stressed conditions  However, the magnitude of the problems
differ from region to region depending upon the geographical condition, socio- cultural
set up of the region and attitude of the neighboring country. The main characteristic
features of the border areas have been inaccessibility and insecurity.
   
Due to it, the border areas need special treatment for accelerated and integrated
sustainable development. The creation of a congenial environment to impart a sense of
security among the border residents should  be a part of any development strategy,
while studying problems of the border areas, there is a need to make a comprehensive
explanation into different  socio- economic, cultural, psychological, environmental
aspects in an integrated manner to identify the real issues.
Majority border areas of Punjab do not form part of some backward isolated region of
the state but has been rather well developed. Yet they are suffering from acute
discontent, both economic as well as social. The identification of critical issues in border
areas of Punjab is based on interaction with various stakeholders and observations and
impressions of the field visits.
   
There has been a significant increase  in unemployment of both educated and
uneducated and skilled and unskilled youth. The situation is further worsening due to,
on one hand, demographic structure of the population resulting in greater rate of growth
of labour force, and on other hand, reduction in labour intake in agriculture and also in
industrial and service sectors for reasons of cost efficiency to meet several challenges
of global competition. The  employment generating programmes, being implemented,
are not showing desired results. Despite huge investments made in the past plan
periods on various employment generation programmes, problem of employment, in
Annexure-VI        
      2
   general, and of the semi- educated and educated persons in particular, has become
critical. The local labour is not interested to come forward for work on employmentoriented programmes, as they generally complain of low wages. Most of border villages,
especially in three districts  of Gurdaspur, Amritsar and Tarn Taran, have migrated
labourers, from Bihar and Uttar Pradesh, who have been working on daily wage labour
and on contractual labour, both in employment generation works of PRIs and
agricultural operations. Theirs wage rates are very low. No doubt, the agriculture has
reached at saturated point and educated youth of farm households is not willing to work
at their farms for reason of low earnings. However, some progressive farmers with
higher education have taken up farm related activities like floriculture, horticulture, dairy
farming and agro processing. It is a positive approach towards diversification of
occupations.  and various changes are taking  place positively. Nevertheless, Punjab
economy, particularly of border areas, is still dominated by the agriculture sector since
quite a significant proportion of population in the border areas still depend on this sector
for employment and income. The non- farm sector has not been able to grow as fast as
required to absorb the labour force released from the agriculture sector. At same time,
the household industry, in this region, is also facing problems due to lack of
modernization in terms of technological and skill up gradation and competition from the
organized sector. The labour force in this sector, however, has been working under
highly unfavorable conditions.
   
Efforts towards diversification of cropping pattern have not got much success. Although
sufficient steps are being taken to diversify agriculture, but the diversification of cropping
pattern has met with limited success in the border districts.  Basically concept of
diversification, from various points, is considered to include improvement in farm and
rural incomes, generation of additional gainful employment opportunities in farm sector,
capacity to cope with changing demand patterns for agricultural products in domestic as
well as international markets; conservation and improvement of bio-diversity and
adjustment of production patterns with resource endowments and availability of
production resources in different areas for avoiding overuse of scarce and depleting
resources. It is significant to note here that besides agriculture, in order to improve the
incomes of farmers and agricultural wage labourers, there is a dire need to develop the
non- farm sector. There has to be a high degree diversification of the rural economy
bringing off- farm employment opportunities close to the rural households.
   
As in the central Punjab, the border areas, too, have also witnessed very low growth of
agriculture sector; and even in some pockets, either there is quite low yield of crops or
has remained stagnant. The expensive cost of inputs, unremunerative prices of
agriculture produce, overuse  of natural resources, decrease in operational holdings,
resulting to marginalization and population of peasantry and over- mechanization has
pushed the agricultural economy in a critical  situation. In order to tackle with such
situation, the possibilities of diversification have to be explored in the cropping pattern.
There is need  to shift the present pattern of monoculture cropping towards the
diversified pattern, including of cultivation of oilseeds, vegetables, pulses, sugarcane,
fodder, horticulture and forestry. Although there is also need for land reforms, however,
there is scope in promote subsidiary occupations, as short term measure, such as dairy,
poultry, fishery, piggery and others, especially to improve the lot of small and marginal
farmers.
     
The extent of the land utilization in border districts has reached near saturation although
there are some variations in terms of land utilization, cropping pattern, cropping intensity
and irrigation. Gurdaspur district has a sizeable area under forestry, which has been
maintaining ecological balance and prevention of floods and  soil erosion. The issues
relating to harnessing and managements of  water resources require immediate
attention, in view of large  areas being affected by brackish  water in Firozepur district
and sizeable areas of Tarn Taran district. Even in subamountaneous areas of district
Gurdaspur, the level of sub- soil water is low. The marginal, small and semi- medium
farmers of the border districts have been trying to increase their family income by
adopting occupation of dairy. The landless families have also increased their reliance on
dairy activities. But cattle rearers face the  problem of low price  of milk both in co-
operative as well as in private sector.
     
Annexure-VI        
      3
   There is also an inclination towards horticulture among large sized farmers i.e. fruits like
pear, peach, grapes, beri, kinnow, guava, etc. which are grown here. The problem of
marketing such product still exists.
     
Since 1990s land inequalities have been emerging in entire state, but it is quite acute in
the region of border areas of the state. The land inequalities have been reinforcing the
parallel inequalities in crop incomes of farmers further resulting in to the emergence of
differentiation in the peasantry of the border areas.
     
The social sectors, especially education and health, have been suffering from serious
deficiencies in terms of adequate infrastructure and service delivery. The paucity of
teachers and absenteeism among the teachers, is still a common characteristic of the
education system of border areas. The drop out rate among school children, especially
girls, is more. The higher education is in quite deteriorated situation. The infant mortality
and child mortality rates are comparatively  high as compared to non- border districts
due to deficiency of health care facilities in that region. A very large proportion of
population goes to private hospitals or private clinics for their treatment. The grassroots
level health workers are there but not adequately motivated to work in rural areas due to
lack of civic amenities. The sanitation in border areas is quite at the low level. The
percentages of households having latrines are considerably  less as compare to non-
border areas. The quality of water, especially in some pockets in the border areas of
districts Amritsar, Tarn Taran and Firozepur is not drinkable and it is true that many
households do not have access to safe drinking water. Although, some villages have
water works projects, but either they are not properly operate or remains unutilized..
     
Periodic analysis of literacy shows quite  slow pace of growth. There is a direct
relationship between literacy and employment in the border areas. In this regard the
infrastructural facility base is highly inadequate. The illiteracy is high among the families
working in agriculture and as wage labourers. The landless agricultural labourers, and
small and marginal farmers are most affected and at the disadvantageous position.
Glaring educational disparities can be seen among  scheduled castes and non-
scheduled castes. The extent of dropouts seems more in the sub- castes like Majhabhi
Sikhs, Christian, Majhhabis,  Sansis, Rai Sikhs, Meghwals, Batwals, Bagri Suthars,
Bagri Luhars and Boria Sikhs. The educated persons, trained in professional and
technical courses are few and they are incapable to tackle the market demand with their
present professional skills. Therefore, the vocational curriculum needs to be making
functionally adequate to respond to the needs of economy with a capacity to produce
more employable persons. Actually, there is general lack of skill formation and technical
education and also there is lack of higher education among border area population.
   
The status of health and education among women of border areas is quite low as
compared to under non- border areas. The female work participation rate is also low,
but women belonging to scheduled castes  households are found  to be engaged in
agricultural activities as agricultural wage labourers and also in other menial activities.
Due to poor access to quality reproductive health care, diseases like reproductive tract
infections and sexually transmitted diseases are high among women. The problems of
drug abuse, distillization of illegal and spurious liquor is much high in border area
region. The synoptic drugs have also become a common feature of society especially
among the youngsters, both literate and illiterate. This negative approach, in total, is
disturbing the social milieu of the village life. Due to the absence of library culture and
declining trend of sports activities, the  evils of drug abuse  and other anti-social
activities, in this region, are emerging on a large scale.
In the present scenario, there is dire need to frame strategy of economic development,
considering of problems of small and marginal farmers, agriculture labourers, other
backward castes and educated unemployed youth on priority basis after proper
identification of deficiencies.
It is to be noted here that although absolute poverty has decreased in the border areas
but disparities in income and wealth have become sharpen resulting in widening of the
range of differences in education, life style, social life and recreation patterns. Like other
areas of Punjab, the border areas, especially of districts Amritsar, Tarn Taran and
Annexure-VI        
      4
   Gurdaspur, have religious appeal, backed by more powerful symbols having much
wider social mobilization potentials. Therefore, there is need to link the religious appeal
in order to improve the quality of life of common people. The panchayati raj system has
taken better shape both in content as well as in form after the implementation of the 73
rd
Constitutional Amendment, but it has been observed that inter- community bonds of co-
operation has been weakening.
Punjab is such state where density of population of border villages is not a function of
proximity to border areas, but the areas, which are agriculturally backward, and more
developed, have relatively lower density as compared to the areas of medium on
agriculture development. The culture, especially  popular singing of the border areas,
shows that penetration of vulgar and commercial forms of folk tradition cutting across
religion and regional boundaries has imparted a new value system based on vulgarity
for the younger generation. Easy money in circulation and illicit activities has been
promoting such vulgar traits  in culture. The basic reasons for it has been a sense of
negative feelings and of deprivation among common people, criminalization of politics,
lack of appropriate representation in the participatory political institutions and
panchayati raj institutions. It has also generated passiveness among the progressive
members of the community.
The existing level of industrial development in border districts, especially in Ferozepur
and Gurdaspur districts, is very low. The informal sector has also become outdated.
Among the agro-processing units, the Rice Shellers has been only surviving units. The
characteristic features of survived informal industrial units are consumer oriented. Most
of such units are using traditional and outdated methods of production.
The border areas region of  Punjab is facing new types of problems with new
developments. Therefore emphasize be there to examine the problems by taking into
account:
™ Contents of development and inter-relationship of the development process and
the broader socio- cultural milieu.
™ Trends in the economy of the state by considering historical developments.
™ Issues relating to the structural changes resulting to structural transformation in
the broader context of society and polity.
While going through such problems and issues, focus should be on
™ distribution of income and assets
™  structure of the economy and its transformation
™  problems related to agriculture development, industrialization,  non- farm sector
and illicit activities like illegal distillation
While dealing with such problems, main stress should be on;
™ Employment generation with development of various skills.
™ Improvement in quality of life focusing on overall human resource development.
™ Capacity building of grassroots level institution such  as panchayati raj and co-
operatives.
™ Confidence building among persons  living in border areas through better
cooperation and coordination of security forces administration and elected
institution.
Following, however, are the basic educational and health problems/ issues faced by
people living in border areas.
™ Insufficient educational infrastructure in the border districts.
™ Paucity of teaching staff, lack of sufficient rooms, drop out among scheduled
castes, children etc
™ Very less stress on technical / vocational education by the state government.
™ Insufficient grants being sanctioned and disbursed for creating better facilities
and infrastructure.
Besides, basic problem of border areas of Punjab is related to the lack of backward and
forward linkages in agriculture, industry and  social sectors. The agricultural produce,
sold in the market, is processed at a distance of 50 to 60 kms away from the border. It is
Annexure-VI        
      5
   happening with horticulture and vegetables, too, and also with allied sectors like dairy,
fishery, and poultry. Due to such lack of backward and forward linkages, the producer is
always in loss and on the same time, he has to purchase consumer goods made from
his own produce at higher prices. Therefore, there is dire need to develop linkages
under the chain system.
The second basic issue is of capacity building of local community by empowering the
panchayati raj system. Till now, the governance through panchayats is in primary stage.
The panchayats have not been empowered by devolving powers to them. These bodies
are not in a position to prepare micro-plans in consultation with members of gram
sabha. Therefore, the grassroots level planning is severely missing here. There is dire
need of multi- level decentralized planning process. The capacity building of women and
scheduled castes representatives of PRIs  is quite essential. The social sector
development is possible only when capacities of PRIs representatives have been built.
It will promote community participation in development process. However, in selfemployment generating activities, the situation of self- help groups is also not very
optimistic and position regarding services of co- operatives is also not quite
encouraging. There are some notable differences among social groups in the
percentage of farmed area devoted to different agricultural activities. It is to be noted
here that as per NSSO data, poverty among rural persons in Punjab was 6.21 percent,
in 2003. The poverty line consumption was Rs. 347.96 per month. The incidence of
indebtedness shows that in Punjab 65.40 percent farmers are under indebtedness and
the indebtedness per household is Rs. 41576. The field experiences show that the
indebtedness in border areas of Punjab is comparatively more than non- border areas.
In the opinion of farmers residing in the border region, government agencies have not
been doing well to provide the necessary services to the farmers. The seed
replacement rates are low. However, for some services, the farmers have to travel long
distances. The knowledge base of farmers is also quite satisfactory. Most of them are
unaware of the institutions  like WTO, liberalization and MSP. As far as access to
modern technology is concerned; majority  of farmer’s households have very less
information on new technology.
The economic condition of farmers’ show that on an average, consumption expenditure
of farmer households is alike of other rural households and in some cases, incidence of
poverty among farmer households is higher than among the other rural households. It is
due to marginalization of peasantry in Punjab, and particularly, in the border districts.
Although farmers’ households are spending considerable expenditure on education and
health, but results shown are not positive. It  is clear that the peasantry of Punjab, in
general, and, residing in region of border districts, in particular, is passing through a
critical phase. There is dismal state of affairs regarding knowledge and awareness for
the farmers. The agriculture sector is in a serious crisis and vast majority of small and
marginal farmers are hardly able to make both ends meet. There is essential need to
take some drastic decisions at the policy level and some remedial measures should be
taken at this juncture. The involvement of local bodies like panchayati raj institutions, in
monitoring the role of the government agencies, at the local level, should go a long way
in improving their services. There is a need  to give recognition to the services of
progressive farmers by instituting awards for their performance. The agricultural
university of the state should devise special courses in local languages for upgrading
the knowledge of farmers. There is also need to emphasize specifically on availability of
timely institutional credit  at reasonable interest rates to the farming community since
non-institutional sources like commission agents and moneylenders continue to charge
exorbitant interest rates. The incidence of indebtedness, low consumption expenditure
and prevalence of poverty and malnutrition are manifestations of the fact that majority of
border households are unable to earn adequate amount to meet their bare consumption
needs. In this context, it is to be noted that in case of farming households of the border
areas, yield and productivity of most of important crops has either stagnated or declining
since 1990s.  At this juncture, large investment in research and development and
vibrant indigenous research system is needed. Further, there is also need to take
institutional measures that help the small and marginal farmers to increase their income.
The landless labourers and small and marginal farmers should be involved in deriving
benefits of increased agricultural exports through innovative institutions like integrated
Annexure-VI        
      6
   co- operatives llike MILKFED, MARKFED and other service co- operatives besides
contract farming and corporate farming system..
Summing up, the biggest challenge for the state is to revive the growth of agriculture
and thereby improve the productivity and income of a  vast majority of farmer
households and agricultural labourers dependent on it.  It is fact that investment is being
made through border area development programmes, but more emphasize should also
be given to activate other development programmes run by various departments of
central as well as state government. There is dire need of exploring the possibilities for
generating employment and making improvement in social sectors in order to improve
the quality of life of people living in the border districts.  Special focus, in this context,
should be on households residing within 0.5 kms. border belt

Details of India-Mauritius Tax Treaty

Mauritius has now agreed to include safety clauses in its tax treaty with India, after the latter decided to put in place GAAR. WE explain the details of India-Mauritius tax treaty.
Key elements of the treaty
The 1982 India-Mauritius tax treaty sought to eliminate double taxation of income and capital gains to encourage mutual trade and investments.
The most discussed and controversial clause of the treaty is Article 13. It says that any capital gain made by a Mauritian firm in India, including those on sale of securities by a resident of that country, will be taxed in Mauritius only.
Since Mauritius does not tax capital gains, any investment into India by a Mauritian escapes capital gains tax on profits on investments made in India.
Why is it a concern for India?
India gets nearly 40% of FDI from Mauritius. A large portion of portfolio investment also comes from there. Most of these investors have set up special purpose vehicles or shell companies in Mauritius to take advantage of tax treaty.
There is also an apprehension that a lot of investment may actually be Indian money (round tripping) coming via Mauritius.
What has been done to prevent misuse of the treaty?
India has proposed a review of the DTAC to prevent treaty abuse. A Joint Working Group (JWG) set up in 2006 didn't make much progress because of the unwillingness of Mauritius to change the treaty.
India has now proposed GAAR, which can deny tax benefits to any arrangement entered solely for the purpose of avoiding tax.
Tax authorities could club shell companies set up in Mauritius to invest in India as such arrangements and deny them tax benefits.
What's 'limitation of benefits'?
As a safeguard measure, tax treaties have conditions that investors have to meet to be eligible for benefits. Mauritius is now willing to include these clauses in the India-Mauritius DTAC.

Sunday, August 5, 2012

How monsoon affects Indian economy


India faces the prospects of a second drought in 4 years, though it is too early in the season to worry. We take a look at the role monsoon plays in the Indian economy.
Is Farm Sector Crucial For Economy?
Statistically, its significance has declined as now farm sector has a much lower share in GDP. However, with over 50% of population still finding its livelihood in the sector, any stress in the sector has a disproportionately large impact on people/photo.cms?msid=14578718
How Important Is Monsoon For Agriculture?
Since India gets most of its water from the 3 months of rains, the importance of monsoons cannot be understated. However, increase in irrigation facilities has helped reduce risks/photo.cms?msid=14578740
How Monsoon Affects Farm Output?Only in extreme drought years does the output drop sharply. The rising importance of winter crop and better irrigation has improved India's ability to withstand monsoon shortfall
/photo.cms?msid=14578788
Is Monsoon Linked To Inflation?
A poor monsoon can create shortage. But in recent years, food inflation has been high despite rains due to shift in demand patterns. A good buffer stock has also weakened the linkage

/photo.cms?msid=14578805