UPSC IAS Interview 2017-18

India becoming Major Destination for FDI Inflow

by K. R. Sudhaman, Economic Affairs Editor, Ticker Plant News

Investment from abroad before economic reforms began in 1991 used to just trickle as foreign investors were wary of opportunity in India. But situation changed rapidly and more and more investment started pouring in with new policy in place. As various sectors were opened up gradually the FDI flow started steadily increasing and it cumulatively stood at 130 billion dollars by 2009.

India is far behind China, which attracts around 60 billion dollars annually. But today things have changed and India is becoming a major destination for FDI inflow. India received around 35 billion dollars in 2008-09 including reinvestments by foreign investors. In 2009-10 too FDI inflow is expected to be around 35 billion dollars, same as previous year despite global slowdown in the face of financial crisis.

Global slowdown in FDI flow
UNCTAD’s 2009 World Investment Report had noted a fall of global FDI inflows, from a historic high of 1.97 trillion dollars in 2007 to 1.69 trillion dollars in 2008, a decline of 14%. UNCTAD had subsequently predicted a fall in global FDI investment flows by 30% from 1.7 trillion in 2008 to 1.2 trillion in 2009.

The Commerce and Industry Minister Shri Anand Sharma said recently that even Organisation for Economic Cooperation and Development in its latest report on investment released in March 2010 has stated there would be a significant stagnation in the global investment activity.

OECD has noted that the average monthly Merger and Acquisition (M&A) activity in the past 12 months was just below 50 billion dollars. The last time monthly M&A activity fell below 50 billion dollars was in April 2006.

Year on Year global M&A activity is now at its lowest level since the beginning of the global economic crisis at around 35% of the levels reached two years ago.

Government sets $50 bln FDI by 2012 &$75 bln by 2014
These are clear evidences that hard times are ahead for global capital flows but India seems to be an exception where capital flows are surging resulting in appreciation of Indian rupee.

Shri Anand Sharma said the Government has set a target to raise FDI inflow into the country to 50 billion dollars annually by 2012 and raise it further to 75 billion dollars annually by 2014. These are not unrealistic targets and one would not be surprised if FDI in-flows into India become more than that of China in the coming years.

Global Community wants India to grow
The Global community wants India to grow and it is time to take advantage of the situation, the Prime Minister Dr. Manmohan Singh said while returning from his eight-day tour of U.S. and Brazil recently.

The World takes a benign view of India’s growth. We should take advantage of that (situation) because we don’t know how long it will last, Dr. Singh told reporters.

The Prime Minister was returning from Brazil after attending India-Brazil-South Africa (IBSA) and Brazil-Russia-India-China (BRIC) summits there.

All these show the enthusiasm the World business community and polity had on investments and confidence they had on India.

Renowned Mangement guru C.K.Prahalad, who died in U.S. recently wanted India to become a manufacturing hub of the World. He was developing manufacturing strategy in collaboration with Planning Commission based on India’s core competences.

Foreign Direct Investment into India is a capital account transaction under the Foreign Exchange Management Act (FEMA). The Government and Reserve Bank of India regulate such transactions.

While in some of the sectors, Foreign Direct Investment is allowed 100% and in some others, it ranges from 26% to 74%. There are some other sectors considered sensitive and hence are not opened up. There are few sectors like retail where allowing Foreign Direct Investment would help the economy particularly perishable commodities like fruits and vegetables in which annual loss is put at Rs 30,000 to Rs 40,000 crore due to lack of cold storage and pan-India market facility.

But there is stiff opposition to opening up retail sector as some fear that it would be a threat to kirana shops. Nearly 90% of retail trade is by small traders and shopkeepers in the country. But experience of the developed world show that retail chains and small shops can exist side by side as in United States and other developed countries.

Government keen to push FDI liberalisation further
There is therefore need for further opening up and allowing of more sectors for foreign direct investment.

As the Minister Shri Anand Sharma himself said that it had been felt, through interaction with various investors, counterpart government organisations and other stakeholders, that there is a need for further simplification and consolidation of the FDI policy framework, so as to make it more comprehensible to all investors and stakeholders.

Consolidated FDI policy announced
Accordingly the Government recently announced a consolidated FDI policy framework which would ensure that all information on FDI policy is available at one place.

There are as many as 178 RBI notifications and Government press notes regarding FDI policy issued from time to time. What the Government has done is to compile a single policy document to facilitate investors. This is a welcome development as plethora of notifications, were not only confusing, difficult to lay one’s hand besides comprehending them.

While consolidating the FDI policy documents, Government has ensured that overlapping policy statements, redundant instructions and outlived policy issues were weeded out.

The Prime Minister Dr. Manmohan Singh said at the 2008 World Economic Forum that our policy will be guided by the desire to make India even more attractive for Foreign Direct Investment. We are particularly keen to rationalise the simplify procedures so as to create an investor friendly environment.

The consolidation of FDI policy was a step in that direction. It has integrated all prior regulations on FDI, contained in FEMA, RBI circulars and various press notes to reflect the current regulatory framework.

This consolidation provides simplification of the FDI policy, greater clarity of investment rules and predictability of policy. This document will be updated every six months to facilitate investors.

FDI is allowed in some sectors and up to certain limit is allowed through automatic route. Some others are approved by Foreign Investment Promotion Board. The major ones particularly those which are sensitive and involve huge investments are cleared by the Cabinet.

Limit for FIPB approval raised to Rs 1200 cr
Recently the Government raised the limit for approval of those foreign direct investment proposals, which needed FIPB clearance. Earlier FIPB, headed by Finance Secretary, is to clear foreign investments up to Rs 600 crore, which has to be finally approved by the Finance Minister. Now that limit has been doubled to Rs 1,200 crore, helping the investors. Any foreign investment beyond Rs 1,200 crore only will have to go to cabinet for approval.

India has come a long way since economic reforms were started in 1991 in attracting foreign investment. This has helped in boosting country’s foreign exchange reserves to nearly 300 billion dollars now. Also it has helped in injecting competition, bringing in new and sophisticated technology particularly in manufacturing and services sectors and get new markets abroad boosting country’s exports.

But as Dr. Manmohan Singh himself says, a lot more needed to be done and more reforms and more opening up particularly the financial sector, retail and like are widely expected.

Monetary Policy and Inflation

by K R Sudhaman, Economic Affairs Editor, Ticker Plant News

In Developed countries Monetary policy which is unveiled by the central bank periodically is mainly aimed at keeping inflation low. In India as well as many other developing economies central banks have twin objective of controlling inflation and pushing growth.

It is therefore a balancing act always for Reserve Bank of India, which has to contain inflation without impeding growth momentum, every three months monetary policy review takes place. Of course, central bank can intervene in between if an unusual situation arises warranting policy action.

In the face of global currency crisis in 2008 which blew over into a recession, unprecedented since the great depression of 1928, central banks world over including India had to take swift monetary action to get out of the monumental crisis.

With severe liquidity crunch in the banking system and collapse of several top global banks due to mounting bad debts, policy actions were required to pump-in money into the system so that demand picks up and thereby the plummeting growth, crucial for the health of the economy.

Instead of keeping tight control of money supply and interest rates, central bank adopted easy monetary policy by injecting more money into the system and lowering interest rates which fell to near zero in developed countries to prop up growth that became negative in some countries.

Conservative Approach By RBI
Unlike in many other countries, Reserve Bank of India has been conservative in its monetary policy and the Government very cautious in moving towards full float of rupee, that is total capital account convertibility. This approach helped India to ward off a major crisis and economic recovery from the global recession faster.

During the crisis the Government and Reserve Bank had to come out with fiscal stimulus and monetary stimulus packages to revive the economy. This pushed the Government’s fiscal deficit up to 6.7% of GDP (2009-10) due to increased spending, leading to high borrowing.

Reserve Bank’s Monetary policy became very accommodative releasing more cash into the system and lowering key policy rates to reduce interest rates so as to ensure that cost of borrowing is less. The monetary instruments that the central bank used for this purpose are Cash Reserve Ratio (CRR), the percentage of money, the slice of deposit that banks have to park with the central bank and the key short-term policy rates, Repo and Reverse Repo rates. (Repo is the rate at which banks borrow overnight or short-term from the Reserve Bank. Reverse Repo rate is the rate at which banks deploy surplus funds with the central bank.)

With large capital flows from abroad and increasing domestic demand for investment funds, there was increased borrowing before the global crisis and the central bank had increased Cash Reserve Ratio to as high as 9% in a grade manner to suck out excess liquidity in the banking system so that there was no overheating of the economy, particularly through increased lending to real estate sector where a bubble was in the making. Likewise it increased repo and reverse repo rates in stages and repo rate was as high as 6% to ensure cost of funds for lending become expensive for banks.

Easy Monetary Policy During Global Crisis
When the global recession started, central bank started adopting accommodative monetary policy, making available more liquidity in stages and reduced the cost of borrowing. CRR came down to as low as three per cent and Repo rate to nearly 4 per cent. This released more than 3 lakh crore into the banking system so that there was ample liquidity available to prop up growth. With the economic recovery and surging inflation, unwinding of the easy monetary policy and fiscal stimulus began in a calibrated manner in the last few months. Monetary tightening began in January to ensure excess liquidity is sucked out in a graded manner to contain inflation without impeding growth momentum as economic recovery is still fragile.

Exit From Easy Policy Began With Recovery And Inflation Surging
To tackle rising inflation, the central bank in its annual monetary policy statement for 2010-11 unveiled on April 20 raised key policy rates – repo and reverse repo rates for second time in as many months and CRR to squeeze out excess liquidity from the banking system. The Repo and Reverse Repo rates were hiked by 0.25 % and CRR too by 0.25% to take away Rs 12,500 crore from the system. An increase in policy rates signals a rise in interest rates. Repo rate will now be 5.25% while Reverse Repo rate will be 3.76%.The CRR hike which will come into effect on April 24 will now be 6%. Earlier in January during the quarterly policy review, the central bank had raised CRR by 0.75% to 5.75% to suck out Rs 37,500 crore liquidity from the banking system. Reserve Bank Governor, Dr. D Subbarao rightly said after the policy announcement that he would like to take “baby steps” which was better for the economy as drastic hike in policy rates and CRR might have helped in bringing down rapidly but would hit hard the growth that is beginning to look up.

Inflation Still A Matter Of Concern
Inflation no doubt is a matter of concern as food inflation has started spilling over to non-food areas. But a small dose of inflation is good for the economy as it has multiplier effect thus helping the pace of recovery. “We believe that taking several baby steps towards normalisation is better for the economy to adjust with the pre-crisis growth level,” Dr. Subbarao said. These baby steps might not immediately affect lending rates of banks as there is still enough liquidity in the system as demand for credit is picking up slowly.

Dr. D Subbarao said he would not like to take mid-policy action before July end, when the quarterly policy review will be unveiled. He pegged the inflation to be at 5.5% in 2010-11 and the growth to pick up to 8% in the financial year.He said it was therefore important to calibrate the exit from the easy policy stance, given the revival in demand for credit and the large Government borrowing programme. He expected credit growth of 20% this year.Endorsing the measure, the Finance Minister Shri. Pranab Mukherjee described it as “well-balanced and mature” and this “gentle’ and “small tightening of credit” will dampen further inflationary pressures. He even disagreed with Reserve Bank forecast of 5.5% inflation this year saying analysis showed that the Inflation may come down further and it could be even close to 4%.

Inflation To Come Down Further
Food prices have already started falling with the arrival of rabi crop. The Finance Minister said overall inflation has peaked and should be on a downward trajectory from now on. There was nothing untoward happening on the weather front this year to warrant fear of food prices going up again.With the economy now being stable and on track, “ I view these changes as a move to normal times,” Shri. Pranab Mukherjee said assuring there was no need for any worry that squeezing of credit will not dampen growth especially in the durable goods sector.“Our analysis of industrial growth and credit off-take suggests that there is no reason for such apprehension (of impeding growth). In fact, these policies will aid sustainable growth,” The Finance Minister aptly summed up the monetary measures taken by Reserve Bank.
Disclaimer : The views expressed by the author in this feature are entirely his own and do not necessarily reflect the views of PIB

Census 2011 – Do You Know?

Input from the Ministry of Home Affairs

• Census is the basis for reviewing the country's progress in the past decade and monitoring the on-going schemes of the Government.
• Census 2011 will be the 15th National Census of the country.
For the first time a National Population Register (NPR) is being prepared as a part of Census exercise. This is a Register of Usual Residents.
• The NPR will be a comprehensive identity database that would help in better targetting of the benefits and services under the Government schemes/programmes, improve planning and help strengthen security of the country. This will benefit people of the country in the years to come.
• Government servants duly appointed as Enumerators visit each and every house and collect the information required by asking questions and filling up Census Forms.
• Details such as Name, Date of Birth, Sex, Present Address, Permanent Address, Names of Father, Mother and Spouse etc will be gathered by visiting each and every household. All usual residents., will be eligible to be included irrespective of their Nationality.
• In the Houselisting and Housing Census, 35 questions relating to building material, use of houses, drinking water, availability and type of latrines, electricity, possession of assets etc. are being canvassed.
• The enumerator takes down all particulars as given by respondents. Respondents are not required to show any proof.
• Each household is required to provide information without any fear. The information collected about individuals is kept absolutely confidential and will not be shared with any agency - Government or private.
• The NPR form has to be signed by the respondents. In case one requires, he/she may ask the Enumerator to read it out and then affix signature/thumb impression. In any case, do ascertain that the details are correctly entered.
• The provision of false information can invite penalties under the Census and Citizenship Acts.
• Each and every household will be given an Acknowledgement Slip at the time of enumeration.
• Once the information is compiled, the data compiled will be printed out and displayed at prominent places within the village and ward for the public to see. Objections will be sought and registered at that stage.
• The data finalized will be entered into computers in the local language of the State as well as in English. Once this database has been created, biometrics such as photograph, 10 fingerprints and probably Iris information will be added for all persons aged 15 years and above. This will be done by arranging camps at every village and at the ward level in every town.
• Each household will be required to bring the Acknowledgement Slip to such camps. Those who miss these camps will be given the opportunity to present themselves at permanent NPR Centres to be set up at the Tehsil/Town level.
• After the NPR has been finalised, the database will be used only within the Government.
Unique ID numbers will also be generated for every person. The UID Number will be available for each individual. For those below the age of 15 years (for whom biometrics is not available), the UID Number will be linked to the parent or guardian. (PIB)

Many Species, One Planet, One Future

by Ahmad Noor Khan, Senior Scientist, Former Assistant Director, National Environmental Engineering Research

With our present approach to development, we have caused the clearing of much of the original forests, drained half of the world’s wetlands, depleted three quarters of the fish stocks, and emitted enough heat-trapping gases to keep our planet warming for centuries to come.

As a result, we are increasingly risking the loss of the very foundation of our own survival. The variety of life on our planet – known as ‘biodiversity’ – gives us our food, clothes, fuel, medicines and much more. When even one species is taken out of this intricate web of life, the result can be catastrophic. For this reason, the United Nations has declared 2010, the International Year of Biodiversity, and people all over the world are working to safeguard this irreplaceable natural wealth and reduce biodiversity loss.

Rwanda’s capital Kigil will be the global host for World Environment Day (WED) 2010 in conjunction with the celebration of the annual ‘Kwita Izina’ ceremony (which means giving names to Baby gorillas), under the theme, ‘Many Species, One Planet, One Future’, in an exciting event at the foot of the Virunga Mountains, shared by Rwanda, DRC and Uganda. Rwanda is home to about 1/3 of the 750 endangered mountain gorillas left in the wild. Since 2005, 103 baby gorillas have been named and this year 11 gorillas will be named on the eve of WED.

Biological diversity encompasses all species of plants, animals and microorganisms and the ecosystems and ecological processes of which they are part. It provides the basis for life on earth. The fundamental, social, ethical, cultural and economic values of these resources have been recognized in religion, art and literature from the earliest days of recorded history. Wild species and the genetic variations within them make substantial contribution to the development of agriculture, medicine and industry. Perhaps, even more important, many species have been fundamental to stabilization of climate, protection of watersheds, protection of soil and the protection of nurseries and breeding grounds. Only 13% species are supposed to be known of the world’s existing microbial resources covering algae, bacteria, fungi, lichens, viruses and protozoa. Diversity of microorganisms is preserved through culture collections, to be used beneficially in mining for metals, getting rid of methane from coal mines, cleaning up of oil spills, creating perfumes, monitoring air pollution, controlling insect pests, destroying pesticides in the soil, etc.

Yet, some 100 species, out of the earth’s 30-50 million species are being lost each day under agriculture schemes, cities, industrial developments and dams or through pollution and erosion. A total of 17,291 species are known to be threatened with extinction – from little known plants and insects to birds and mammals. Many species disappear before they are even discovered. Humans are among only a handful of species whose population is growing, while most animals and plants are becoming rarer and fewer.

Man has always been fascinated by the diversity of life. Hunter-gatherers celebrated it through paintings in their caves. Gautama Buddha was born in a sacred forest of Sal trees and attained enlightenment meditating under a Peepal tree. The Bishnois of Rajasthan project antelopes as their blood brothers and President Theodore Roosevelt spearheaded the drive to protect American wilderness through national parks. At the same time people have often ruthlessly wiped out life in all its diversity. Mammoths were exterminated by hunter-gatherers during the last ice-age, and the bison was wiped out from American prairies by white settlers.

People have used and abused life with all its diversity over the ages, but never had diversity been a focus of worldwide attention. The rich and powerful in the global community have just realized its enormous economic potential.

The ancient scriptures are full of saying, justifying the need of survival of all life forms. The environmental consciousness shown by king Ashoka, the traditions being followed by the Bishnoi cult of Rajasthan, and the commitments reflected in the Chipko Movement are all examples of heightened awareness of the common man. However, the environmental consciousness of the people is often marred by their poverty and basic needs of survival. Their day-to-day need of fuel has led to cutting of forests. Tigers, deers, crocodiles, rhinoceros and other wild life are diminishing. The trade in the carcasses of endangered animals continues only because of the need of certain people to adorn themselves.

The intense pressure on biological diversity is a direct reflection of increasing human numbers. These pressures are expected to increase until population stabilizes, as projected by the United Nations by about the year 2050 – 2070 at about 10 billions. Such stabilization will be achieved only if present efforts to curtail population growth are pursued vigorously.

The theme of WED 2010, ‘Many Species, One Planet, One Future’, echoes the urgent call to conserve the diversity of life on our planet. A world without biodiversity is a very bleak prospect. Millions of people and million of species all share the same planet, and only together we can enjoy a safer and more prosperous future.
(PIB Feature) Disclaimer: The views expressed by the author in this feature are entirely his own and do not necessarily reflect the views of PIBWorld Environment Day, 5 June 2010

Biodiversity: Connecting with Nature

by Kalpana Palkhiwala, Deputy Director, PIB, Delhi

World Environment day (WED) is aimed at generating awareness about the environment and drawing political attention and public action. This is a day, which calls for environmental conservation through global action. It is on June5 that United Nations Conference on the Human Environment began. It was established by the United Nations General Assembly in 1972 at the Stockholm Conference. A resolution, adopted by the General Assembly the same day, led to the creation of the United Nations Environment Programme (UNEP).

“Stockholm was without doubt the landmark event in the growth of international environmentalism,” writes John McCormick in the book Reclaiming Paradise. “It was the first occasion on which the political, social and economic problems of the global environment were discussed at an intergovernmental forum with a view to actually taking corrective action.”

The first World Environment Day was on 1973. World Environment Day is hosted every year by a different city with a different theme and is commemorated with an international exposition.

Commemorated each year on June 5, World Environment Day is one of the principal vehicles through which the United Nations stimulates worldwide awareness about the environment. With thousand of events in UNEP’s six global regions, namely, North America, Latin America and the Caribbean, Africa, Asia and the Pacific, West Asia and Europe, World Environment Day is considered one of the largest environmental events of its kind.

This Day is designed to give a human face to environmental issues, empower people to become active agents of sustainable and equitable development, promote an understanding that communities are pivotal to changing attitudes towards environmental issues, and advocate partnership which ensure all nations and people enjoy a safer and more prosperous future. WED also is a people’s event which is celebrated around the globe with colorful activities such as street rallies city-wide, scientific forums, green concerts, essays and poster competitions in schools, tree plantings, as well as recycling and clean-up campaigns.

UNEP leads and organizes WED, creating a yearly theme and selecting a host country and a host city, which is a setting example for green policies. The theme for WED 2010 is “Many Species, One Planet, One Future,” an idea that brings to attention the urgency required to protect the planet’s dwindling diversity. In accordance with the celebration of International Year of Biodiversity, the Ministry of Environment and Forests has decided to celebrate this day as “Biodiversity: Connecting with Nature”.

Since 1972, thirty-six World Environment Day celebrations have been held around the globe. World Environment Day 2010 in Pittsburgh will be the North American host city and it will mark the 37th annual celebration. Rwanda has been chosen as the 2010 WED host country, and there are good reasons for it. The East African Nation has initiated numerous eco-friendly policies, such as clean-up campaigns, restorations of rainforests, implementation of renewable energy sources, and a ban on plastic bags.

UNEP recognizes Rwanda’s actions as inspirational for the rest of the Planet, and is celebrating the strides taken by the government and people of Rwanda by honouring their progressive ethics with the prestigious title of host country. Additionally, Rwanda sets an ideal backdrop for the variety of environmental activities planned for June 5 since it is home to numerous diverse and endangered species, as well as displaying a rich natural environment.

There are a myriad of simple tips anyone can follow to celebrate WED on June 5 2010, and to continue living a greener life thereafter. Rely on energy efficient bulbs to light up your home. Replace bottled water with a filtration system at home. Try biking or walking to work at least once a week, which will reduce carbon footprint. Plant a tree with family and/or community members. Give up plastic bags and use reusable shopping bags when shopping at the grocery store.

For World Environment Day 2009, the host country was Mexico, the North American host city was Omaha, Nebraska, and the theme was, "Your Planet Needs You--Unite to Combat Climate Change," an attempt to focus attention on the need for the World to agree on a new climate treaty this year. PIB Feature)

First World Classical Tamil Conference

by Prof.M.Naganathan, Vice-Chairman, Tamil Nadu State Planning Commission

Stage is all set for the first World Classical Tamil Conference in Coimbatore in Tamil Nadu. The five day literary-cultural event starting from 23rd of June2010 is the biggest such gathering in the history of modern Tamil Nadu. President Smt. Pratibha Devisingh Patil will inaugurate the literary-cultural extravaganza in the presence of the world torch bearers of Tamil language and the Tamil Culture that include Dr.M. Karunanidhi, the Chief Minister of Tamil Nadu.

Tamil language that has an enviable history of more than 2000 years got its due recognition at national level when the Government declared it a Classical Language in 2004. This recognition paved way for reassessing the growth of Tamil language, prose and literature in the context of knowledge explosion of 21st century.

In this backdrop, it won’t be out of place to look back to how the Tamil language and culture was embraced by missionaries and academicians from across the seas. Many interpretations have been given to the variety and richness of Tamil literature, Tamil grammar and prose by identifying its unique antiquity and legacy. Among them were many notable Christian missionaries and host of scholars who visited the southern parts of India at different periods of time in the history.

Roberto De Nobili, an Italian Jesuit missionary arrived in Madurai, the southern part of Tamil Nadu, in 1605. He studied Sanskrit and Tamil literature and made considerable contribution towards promoting Tamil prose. While expounding Christianity in Tamil soil, he brought several Tamil words to Christian Tamil literature. The words ‘Kovil’ (Temple), ‘Arul’ (Grace), ‘Poosai’ (Mass or Worship) were coined by him. Therefore, he was considered to be a pioneer in Tamil prose writing.

Ziegenbalg, a German Lutheran and first protestant missionary to India had arrived at ‘Thrangampadi’ (Tranqueber) in Tamil Nadu in 1709. He had first opened up Tamil language to the printing technology. The Tamil translation of New Testament done by Ziegenbalg was published in 1715. It is claimed that he only had brought the first book in English in Asia in 1716. He had also composed a Tamil Dictionary and Grammar book.

Succeeding Zieganbalg, Rev.Fr.Beschi also from Italy came to Madurai in 1711. He had studied deeply Tamil and wrote a literary piece and Tamil Grammar. Further he had composed quadruple lexicon popularly known as ‘Chaturakarati’. This eminent work attracted the attention of many western and eastern scholars towards classical Tamil. His everlasting contribution to Tamil can be found in his extraordinary epic poem called ‘Thembavani’ having 3615 stanzas on the life of Saint Joseph.

Francis Whyte Ellis a civil servant of East India Company settled in erstwhile Madras in 1810 and remained there till his death in 1819. He pursued research in Dravidian languages - Tamil, Telugu, Malayalam, and Kannada besides Sanskrit. He was considered the first scholar in the field of Comparative Dravidian Linguistics.

Bishop Robert Caldwell (1814–1891) had served in Tirunelveli as a Christian missionary. After studying and analyzing all Dravidian languages, he wrote his magnum opus ‘Comparative Grammar of the Dravidian Languages’. This work provoked a lot of intellectual debates and ignited the minds of scholars to go deep into the origin of Tamil, Dravidian and Indian languages.

Rev.Fr.George Uglow Pope (1820–1908) popularly known as G.U. Pope, was a Christian monk who came to South India to propagate his religion and became a savant of Tamil and interpreter of Thirukkural. Attracted by the erudite scholarship of Valluvar, Pope had said that “Kural owes much of its popularity to its exquisite poetic form. A kural is a couplet containing a complete and striking idea expressed in a refined and intricate metre. He tried to convey the universal message of Valluvar in his own way in the English language for the first time. He brought fame and name for Valluvar’s immortal contribution to world literature.

Among the several European Tamil scholars, Professor Gilbert Slater was the first Economist from England who was given the position of Professor and Head of the Department of Economics, University of Madras in 1915. He had first introduced field studies in Economics and taken students to Iruveli Pattinam village in the then South Arcot district and Selaiyur village in the then Chengulput district of Tamil Nadu. As a multi-lingual scholar, he wrote the famous research book on “The Dravidian Elements in India’s Culture”. He was the first scholar to state categorically that the antiquity of Tamil language and civilization belong to more than 3500 years. His interpretation to the word ‘Dravidian’ itself is noble and novel. Dr.Gilbert Slater had given modern interpretation to the economics of Tamils.

He had also compared Tamil with Latin and Greek, the classical languages of Europe and stated that “Tamil versification is based on quantity, like Greek and Latin; it also employs rime, but at the beginnings, not the endings of verses; and alliteration, but within the verse and not as a link between verses. Tamil music is based upon quarter-tones, i.e. there are twenty eight divisions of the octave instead of seven. Indian culture, with its special characteristic of systematic and subtle philosophical thought, must have come from people capable of originating and developing it. That capacity would naturally be exhibited also in the evolution of language, and the purest Dravidian language does exhibit it in the highest degree – in a higher degree than any other Indian language.”

The contributions of European scholars led to the resurgence of research in Tamil language, literature, prose and poetry not only in Tamil Nadu but also other parts of the world. Tamil is having more than four lakh words. The Tamil lexicon composed by great scholar Vaiyapuri Pillai and published by the University of Madras had more than 1.25 lakh words with explanations. Tamil lexicon prepared by the great scholar Pavaanar published by the Government of Tamil Nadu traces the etymological origin of each and every Tamil word. In its continuation, the Department of Tamil Development, Government of Tamil Nadu has so far published 20 volumes of etymology of Tamil words. It is a work of monumental proportions reflecting the diction of Tamil words in every detail possible. Tamil University, Thanjavur published ‘Dictionary of Technical Terms from English to Tamil’ edited by Dr.Aruli, a scholastic researcher. The Tamil language is the rich repository of more than three lakh technical words to the surprise of many linguists and scholars as elaborated by Dr.Aruli. Many private publications have also brought out Tamil to Tamil, English to Tamil, Tamil to English dictionaries and lexicons by a group of eminent scholars. These are the standing testimonies to the Tamil’s eminence, modernity of expression and its classical character.

In this context, the First World Classical Tamil Conference in Coimbatore will be a milestone in the development and promotion of Tamil language in the 21st century. Great scholars, poets, novelists, religious savants and linguists of international repute will present research papers and deliver lectures during the five day conclave.

No doubt, the outcome of the conference will blossom and carry the fragrance of uniqueness, richness and legacy of the Tamil language all over the world and add a new dimension to India’s inclusive growth process. Disclaimer : The views expressed by the author in this feature are entirely his own and do not necessarily reflect the views of PIB

Doing Business with South Africa

by Manish Desai, Director (Media), Press Information Bureau, Mumbai
South Africa was a major trade partner of India prior to 1946 and accounted for 5 percent of India's total exports then. But, following the introduction of apartheid regime in South Africa, India became the first country to sever trade relations in 1946, and subsequently imposed a complete - diplomatic, commercial, cultural and sports- embargo on that country. It remained an outspoken critic of the apartheid era government in South Africa, a stand, which evoked goodwill for it in South Africa and other African countries.

India's relations with South Africa were restored after a gap of over four decades with the opening of a Cultural Centre in Johannesburg in May 1993. Formal diplomatic and consular relations with South Africa were restored in November 1993. The Indian High Commission in Pretoria was opened in May 1994, followed by the opening of the Consulate General in Durban the same month. South Africa, in addition to its High Commission in NewDelhi, has a Consulate General in Mumbai.

South Africa – a gateway to the African continent
South Africa is the economic powerhouse of the African continent, with a GDP of $ 277 bn, accounting for 30 % of entire GDP of Africa. The country leads the continent in industrial output, mineral production and generates 50% electricity consumed in Africa.

The South African economy after growing consistently above 4 percent annually for the last five years shrank during 2009 due to declining business and consumer demand. Real GDP is expected to recover in 2010 – helped by the hosting of the Football World Cup in June/July, which will give a major boost to tourism and services sectors.

South Africa’s leading trade partners are mainly the OECD countries and China. US, Japan and China are the major destinations for South Africa’s exports and together account for close to 30% of its total overseas shipments.

India – South Africa bilateral trade
Since restoration of ties, bilateral trade between India and South Africa has grown exponentially from about US $ 3 billion to over US $ 7 billion during 2008-09. The two countries have now taken up a challenge to boost bilateral trade to US $ 10 billion by 2012.

The major exports from India to South Africa are mineral fuels, automobiles and transport equipments/components, castor oil, cosmetics/toiletries, cotton yarn, fabrics, made ups and natural silk, pharmaceuticals, fine chemicals, inorganic, organic/agro chemicals including dyes & intermediates & coal-tar chemicals, electronic goods, finished leather/leather goods, gems and jewellery.

The major imports of India from South Africa are coal, coke and briquettes, diamonds, pearls, precious and semi-precious stones, gold and silver, electronic goods, fertilizer, inorganic and organic chemicals as well as artificial resins, iron, steel metal ores, non-ferrous metals, metal scrap and crude minerals.

There is substantial untapped potential for trade growth between the two countries. Potential exports from India to South Africa include vehicles and auto components, transport equipment, drugs and pharmaceuticals, computer software, engineering goods, footwear, dyes and intermediates, chemicals, textiles, rice, and gems and jewellery, etc. Potential areas of import from South Africa to India have been identified as rock phosphates, precious stones and minerals, fertilizers, steel, coal, transport equipment, pulp and pulp manufacturing, etc.

Although accurate data on Indian FDI in South Africa is not available, it is estimated that the Indian companies are currently executing projects worth over US$ 2 billion in South Africa. Major investors include Tatas (vehicles, IT, ferrochrome plant), the UB Group (beer hotels), Mahindras (utility vehicles), Apollo Tyres and a number of pharmaceutical companies including Ranbaxy, Cipla etc. .

Just as Indian investment in South Africa has been rising, there is also a growing trend of South African investments in India led by SAB Miller (breweries), ACSA (upgradation of Mumbai airport), SANLAM and Old Mutual (insurance), ALTECH (set top boxes), Adcock Ingram (pharmaceuticals), Rand Merchant Bank and Standard Bank (banking).
Boosting bilateral economic relations is a win win situation for both India and South Africa India could be a very useful trade and investment partner for S Africa as it is a major exporter of highly skilled workers in software, financial services and software engineering. India's assistance in skills transfer would assist South Africa in the eradication of poverty and encourage economic growth.
In India, over the next seven years, US$ 50 bn is expected to be spent on roads and infrastructure and US$ 240 bn on power. South Africa with its expertise in areas such as airports and electricity production could assist India in these areas.

Trade initiatives
India –SACU Preferential Trade Agreement
An important initiative under negotiation between the two countries is the India-SACU Preferential Trade Agreement, eventually leading to a Free Trade Agreement between India, SACU and MERCOSUR (a ‘large free trade area of the South' ). Four rounds of negotiations between SACU and India have been held so far. An Agreement for Reciprocal Promotion and Protection of Investments (BIPPA) is also waiting to be concluded. Early conclusion of these agreements could provide a real impetus to trade and investment.

Reconstituted CEO’s Forum
Commercial interaction is being boosted by the establishment of an India-South Africa CEOs' Forum, which was reconstituted and launched in Mumbai on June 3, 2010 by the visiting South African President, Mr.Jacob Zuma and the Commerce and Industry Minister of India, Mr.Anand Sharma. The CEO’s Forum is chaired by Mr.Ratan Tata on the Indian side and Mr.Patrice Motsepe on the South African side.

India Business Forum
The India Business Forum (IBF), launched in 2007 with its headquarters in Johannesburg, brings together the heads of all Indian companies in South Africa and provides a platform for promoting brand India and for taking up issues of common concern. IBF currently includes 39 companies and is managed by the Confederation of Indian Industry (CII).
The presence of Indian banks (State Bank of India, Bank of Baroda, Bank of India, EXIM Bank and ICICI Bank) has promoted economic interaction. Resident offices of GOI Tourist Office and National Small Industries' Corporation are also active in promoting cooperation.

While there are opportunities galore for doing business with South Africa, there are many challenges too, that need to be addressed quickly. Most businessmen from India have complained about the painfully slow visa issuing system of South Africa, which has led to loss of business opportunities. South African Government has promised to improve upon it, but it will take time. While South Africa has favoured import of automobile and auto-components, tariff rates at 36 per cent act as a major deterrent. Some Indian businessmen have expressed concern about the crime rate being high, which makes a business proposition unsafe.

India and South Africa have a common approach on many global issues. Rooted deeply in history, relations between the two countries now cover virtually all fields and enjoy regional and international significance. Sustained efforts to strengthen, deepen and diversify them are bound to bring rich dividends in future for both the countries.
(With inputs from Mr.Rajeev Jain, Director (Media), Ministry of Commerce & Industry and Mr.Mohan Gawde, Confederation of Indian Industry, Mumbai) PIB feature

Harnessing Potential of Rain-Fed Farming

by Sant Bahadur, Assistant Director, PIB, Delhi
In India, of the total cultivated area of around 140.30 million hectares only 60.86 million is irrigated and remaining 79.44 million hectares is rain-fed. Rain-fed crops account for 48 percent area under food crops and 68 percent of the area under non-food crops. Irrigated land accounts for nearly 55 percent of food production while rain-fed contributes just about 45 percent. Rain-fed farming is risk prone and is characterized by low levels of productivity and low input use but if managed properly, rain-fed areas have the potential to contribute a larger share to agricultural production.

Considering the high potential of rain-fed agriculture, the Central government accorded high priority to the holistic and sustainable development of rain-fed areas. For the promotion of rained/dryland farming, the Ministries of Agriculture and Rural Development are implementing watershed programmes through an integrated watershed management approach. Special emphasis on rained/dryland areas has also been given due importance in all other major programmes of Agriculture Ministry. Under the scheme of Macro Management of Agriculture, approximately Rs. 500 crore is allocated annually for the programmes of natural resource management for development of rain-fed and degraded areas based on watershed approach as per Annual Work Plan proposed by the States. Department of Land Resources has made provision of Rs. 15,359 crore for the XI Plan for watershed management.

Conservation and Optimization of Resources
Conservation of rainwater and optimization of soil and water resources in a sustainable and cost-effective way are the key attributes of integrated watershed management approach. National Watershed Development Project for Rain-fed Areas (NWDPRA), which was launched in 1990-91, was subsumed with the Macro Management of Agriculture supplementation/complementation of the States’ efforts through work plans from 2000-01. Its specific focus is on conservation, development and sustainable management of natural resources; enhancement of agricultural production and productivity in a sustainable manner; restoration of ecological balance in degraded and fragile rain-fed eco-systems by greening these areas; reduction in the regional disparity between irrigated and rain-fed areas and creation of sustained employment opportunities of the rural population.

The National Rain-fed Area Authority (NRAA) provides the much-needed knowledge inputs regarding systematic up-gradation and management of country’s dry land and rain-fed agriculture. The Authority is mandated to coordinate and bring convergence within and among agricultural and wasteland development programmes being implemented in rain-fed areas of the country. For the XI Five Year Plan, Rs. 123 crore has been earmarked for this purpose.
In association with concerned Ministries/Departments and Planning Commission, the Authority has published Common Guidelines for Watershed Development Projects with a fresh framework for next generation watershed programmes. New watershed projects are being prepared in accordance with these guidelines with effect from 1st April 2008. The Authority has also prepared a Vision Document for harnessing innovative policies, knowledge, technologies and opportunities for holistic and sustainable development of rain-fed areas. The Authority has also prepared a detailed format to help States in preparing perspective plans for the development of rain-fed areas. It has organized workshops for the adoption of guidelines and preparation of perspective plans. The Authority has also prepared a comprehensive report on mitigation strategy for Bundelkhand regions of UP and MP.

Integrated Watershed Management
Three World Bank assisted integrated watershed management projects are being implemented in Uttarakhand, Himachal Pradesh and Assam under the supervision of Ministry of Agriculture. The World Bank gives funds for these projects directly to State Governments. In Uttarakhand, 2.34-lakh hectare area is to be covered in 468 panchayats of 11 districts. At present, work is in progress in 467 selected gram panchayats with an investment of Rs. 258.93 crore. In Himachal Pradesh, the project covers 602-gram panchayats in 10 districts and the work is in progress in all the selected panchayats. In Assam, 36, 129 tube wells and 11, 674 lift pump sets have been installed, 1077 power tillers have been supplied and provision of 700 tractors have been made under the project. An area of 15, 908 hectares has also been given drainage treatment.

German Technology Cooperation (GTZ) assisted project for decentralized watershed development is being implemented in Karnataka, Rajasthan and Uttarakhand on a pilot basis. It aims at capacity development system for watershed management at the regional and state level. A national consortium comprising Ministry of Agriculture, GTZ, International Crops Research Institute for Semi-Arid Tropics (ICRISAT) and the National Institute of Agricultural Extension Management (NIAEM) have been constituted to achieve the objectives of the project.

NABARD’s Watershed Development Fund (WDF) is utilized for creating necessary framework to replicate and consolidate isolated but successful initiatives under different programmes in the Government, semi-government and NGO sectors. Initially, 18 states were identified for the project but ultimately only 13 states came forward. In 2006, after Prime Minister’s Rehabilitation Package to 31 distressed districts in Andhra Pradesh, Karnataka, Kerala and Maharashtra, it was decided to implement participatory watershed development programmes in all these districts through WDF. At present, 1,196 watersheds have been selected, out of which 416 are in non-distressed districts of 13 states and 780 in 31 distressed districts under the PM’s package.

Research & Training Programme
Indian Council of Agricultural Research (ICAR) has also allocated a budget of Rs. 75 crore in XI Plan for Central Research Institute for Dryland Agriculture (CRIDA) and All India Coordinated Research Project on Dryland Agriculture (AICRPDA). It has developed technology modules in dryland farming for various agro-climatic zones. Eighteen model watershed projects covering different agro-ecological regions of the country have been assigned to Central Soil and Water Conservation Research and Training Institute (CSWCRTI) and ICRISAT to address the bio-physical and socio-economic dimensions of specific agro-climatic conditions and to develop suitable technologies for maximizing the development process under watershed programmes. These projects are to serve as model projects for replicating successful technologies for wider dissemination through NWDPRA and other national and state level funded watershed projects.

Assistance is provided to farmers to adopt these technologies under most schemes such as KVY, NFSM, National Horticulture Mission and Macro Management of Agriculture. Besides, 25 Dryland Centres of ICAR have benefited large number of farmers directly through on-farm trials/ inputs and indirectly through training programmes. All the farmers in the country including dryland farmers are eligible to get credit facilities from banks as per the extant policies of Reserve Bank of India (RBI) and NABARD. In the watershed programmes, assistance is provided for natural resource management related activities. Besides, in most of the other agriculture development programmes, incentives are provided to the farmers in terms of subsidy for various agricultural inputs/operations.

Impact evaluation studies done on the ground and through remote sensing techniques reveal that watershed-based interventions have led to increase in groundwater recharge, number of wells and water bodies and enhancement of cropping intensity. It has also brought about changes in cropping patterns leading to higher yields and reduction in soil losses. It is proposed to develop about 2.34 million hectares covering about 3,878 micro watersheds in the XI Plan. Out of this, an area of 7.96 lakh hectares has been developed at a cost of Rs. 638.40 crore by December 2009.
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