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●● Under the Mid-Term Review of Foreign
Trade Policy (2015-20), government increased
incentives under Services Exports from India
Scheme (SEIS) by 2 per cent.

●● India is working to remove trade barriers
to services.

Services sector growth is governed by domestic
and global factors. The Indian facilities management
market is expected to grow 17 percent CAGR
between 2015 and 2020, and surpass USD 19
billion mark supported by a booming real estate,
retail, and hospitality sectors.

The implementation of the Goods and Services Tax
(GST) has created a common national market and
reduced the tax burden on goods.

to a study, engineering R&D market in India is estimated Over all the initiatives in the services sector have been multi
to grow at a CAGR of 14% to USD 42 billion by 2020 for directional reducing the single sector overdependence like IT
dedicated research centres for R&D in these sectors. BPM. This ensures incidence of the service sector to impact
to a wider range of geographies of the country.
Space

As of March 2017, PSLV successfully launched 254
satellites. Foreign exchange earnings from satellite launch
services increased noticeably in 2015-16 and 2016-17 to
INR 394 crore and INR 275 crore from INR 149 crore in
2014-15.

India’s share in global satellite launch services has also
increased to 1.1% in 2015-16 from 0.3% in 2014-15. Antrix
foresees greater utilization of its launch services for launching
their Low Earth Orbit (LEO) satellites.

Major Initiatives

The PM stated India’s priority is to work towards trade
facilitation agreements (TFA) for services for easier movement
of professionals.

The Government has adopted a few initiatives in the recent
past. These include:

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Swachh Bharat:

Ensuring Cleanliness &
Dignity for Ordinary Citizens

Instilling National Pride

on being extended to the rest of the citizenry. With a total
budget outlay of Rs. 60,000 crore, the Swachh Bharat
Mission or Clean India Mission aims to end open defecation
forever in all villages by 2nd October, 2019. 

Sumantra Basu The progress of the Abhiyan has been impressive to say the
least— as of now 1.13 million toilets have been built across
“Is cleaning only the responsibility of the karamcharis? India. A similar method of gathering and verification of data
Do citizens have no role in this? We have to change this is used by the Ministry of Drinking Water and Sanitation,
mindset”, said Prime Minister, reaching out to citizens who under Swachh Bharat Mission – Gramin (rural) as of
across the country, on the auspicious occasion of now, have built 92.5 million toilets pan-India, with over half a
Gandhi Jayanti in 2014. The Father of the Nation, considered million villages being declared Open Defecation Free (ODF).
cleanliness as an act of the highest value, that next to As a result, sanitation coverage in the rural areas has risen
Godliness. He famously said, “Sanitation is more important from 38.7 percent (October 2, 2014) to over 98 percent.
than independence.” The Swachh Bharat Abhiyan is
perhaps, the most striking resemblance to a highly Gandhian It is worthwhile to note that, independent third party
ethos, prevalent in the DNA of the current government. survey by the Bill and Melinda Gates Foundation states
that incidence of water-borne illnesses such as diarrhea
What started as a crowdsourced initiative, by the Prime was significantly lesser in the Open Defecation Free
Minister inviting nine prominent citizens (namely, Sachin (ODF) villages, as compared to that in non-ODF villages.
Tendulkar, Anil Ambani, Ramdev, Shashi Tharoor, Mridula Another survey by the Unicef concluded that an ODF
Sinha, Kamal Haasan, Priyanka Chopra, Salman Khan village household could be gaining as much as Rs. 50,000
and the team of Tarak Mehta Ka Oolta Chashma) and then per annum as a result of lower incidence of illness and
consequent lower income loss.

Although on April 1, 2000 the then government launched
the Total Sanitation Program (TSC), it was renamed Nirmal
Bharat Abhiyan by the UPA government under Manmohan

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Singh. A study of 80 villages in Madhya Pradesh showed National Mission for Clean Ganga (NMCG) and a lot of other
that the TSC programme modestly increased the number river cleaning projects have been undertaken as part of the
of households with latrines, and had a small effect in mission which has resulted in the holy rivers of India including
reducing open defecation. The low decibel rural sanitation the Yamuna, the Narmada, the Brahmaputra, becoming
program was restructured as Swachh Bharat Abhiyan cleaner. As the flow of garbage is prohibited under the
on 24 September, 2014, amid much fanfare as the NDA project, $3 billion has been allotted to clean the waterways
government focused on awareness and participation for that shall meet the needs of 400 million Indians.
success of the same.
The Swachh Bharat Mission has been a success, mainly on
Under PM Modi, the national campaign was conceived in account that it has two thrusts: Swachh Bharat Abhiyan-
March 2014 at a sanitation conference of UNICEF India and Gramin or Rural under the Ministry of Drinking Water and
the IIT as an inclusion of the larger Total Sanitation Campaign Sanitation, and Swachh Bharat Abhiyan-Urban, which
or Nirmal Bharat Abhiyan which the previous government runs under the Ministry of Housing and Urban Affairs.
had launched in 2000. The chief objectives of SBA was Swachhagrahis or “ambassadors of cleanliness” have
to eliminate open defecation through the construction promoted indoor plumbing and community approaches to
of household-owned and community-owned toilets and sanitation in villages.
incorporating a mechanism to monitor toilet use.
National real-time monitoring and updates from non-
The mission would help India reach Sustainable Development governmental organizations (NGOs), who believe in the
Goal 6 (SDG 6) set by the UN in 2015. The wave of SBA mission’s goal, such as SWaCH Pune (Solid Waste Collection
is India’s largest cleanliness drive to date with over 3 and Handling), The Ugly Indian and Waste Warriors, are
million government employees, and students from across aiding the mission.
India participating in 4,041 cities, towns, and rural areas.
The PM called the campaign Satyagrah se Swachhagra, For a very long time, open defecation and contamination of
which translates to ‘From Insistence on Truth to Insistence water have been a problem dogging India. With 530 million
on Cleanliness’, with reference to Gandhi’s Champaran people contributing and being impacted by it, the country
Satyagraha launched on 10 April, 1917. ranked high on the charts, with the highest number of

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people defecating in the open. Many of the countries that habit of cleanliness at a young age. Rallies have been held to
are economically less-developed rank better in this metric. spread information.
The Swachh Bharat Abhiyan has been critical in reducing the
number of persons who defecate in the open to fewer than PPP models can provide healthy, environment-friendly and
150 million in 2018.  mutually-beneficial solutions for communities by replacing
the harmful with the harmless. With the government doing
The maximum funds under the Swachh Bharat Mission its fair share and the private sector aiding Swachh Bharat
– Gramin, for 2018-19 were released to Uttar Pradesh at Abhiyan, change has been seen. Although the mission was
INR 6,592.64 crores and Bihar at INR 2,943.69 crores. The more about practical ways of dealing with sanitation and
villages under the radar are facing the problem of open public hygiene, it did not fail to stir conversations on online
defecation due to a lack of toilets whereas the urban areas platforms and increased active youth participation.
are prone to another critical problem i.e. improper wastage
disposal that is causing vector-borne diseases. An organized Although the impact of SBA can be witnessed on the
funding is therefore, most probably needed to achieve the ground, there are statistics and reports of the government
overarching goals of the mission. which support the claims. The data found in Individual
Household Latrine (IHHL) report by the Ministry of Housing
PPP or Public-Private Partnership has thus far, proven to be and Urban Affairs, is provided by people who benefit from
an effective model of delivery. Private partnership through the scheme by uploading pictures of the toilets that have
Corporative Social Responsibility supports the municipal been built. These pictures are then scanned and verified.
corporations in maintaining sanitation of new and existing
public toilets. The objective is ultimately not to build an abundance of
toilets, but to make as many villages open defecation free
Also industry-academia collaboration has been a factor as possible through a behavioral change as the absence
in driving innovation. A prime example is the BOT model of it is responsible for the spread of diseases like diarrhea
where 45 custom-designed robots were created by nearly and pneumonia that are responsible for several lakh children
270 students of IIT-Madras. They made robots capable of dying every year.
sweeping an area of 750 square feet in just 15 minutes.
It hardly comes as a surprise then, that India today is only
GenRobotics, a young startup from South India under the the third country in the world that as improved its Travel
Kerala Startup Mission, created a robot, ‘Bandicoot’, in 2015 and Tourism Competitive Index by double digits in a single
which can replace a human’s job of cleaning manholes. In year. The initiative has had positive impact in improving the
the light of deaths caused every year due to workers needing surroundings around the places of tourist interest. Improved
to enter dangerous spaces which are full of toxic waste, sanitation and cleanliness of tourists spots is also a subtle
the municipal corporations across India have placed orders and win-win method to attract tourism and boost India’s
for Bandicoot, at a price of about Rs. 18 lakhs to replace global perception.
humans to do heavy-duty tasks as the Bandicoot can collect
up to 20 litres of sewage in 20 seconds. With citizens turning out in large numbers to pledge for
a Swachh India, the paramount goal to achieve an Open
However, the community participation model has been the Defecation Free (ODF) India by the 2nd of October, 2019,
most powerful in determining the success of the Swachh seems to be a plausible date. This date marks the 150th
Bharat Mission. Lakhs of schools and colleges pan-India birth anniversary of Mahatma Gandhi. To commemorate
have carried out activities like drawing competitions for and honour his vision of a clean India, the country with the
children with the themes ‘Mahatma Gandhi’ and ‘Swachh support of the government, has a year more to contribute to
Bharat Abhiyan’ as well as cleaning drives to inculcate the this national movement of Swachh Bharat Abhiyan.

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Modicare

A Succour To The Poor

DR NINA JACOB across layers, right from ensuring a healthy India to ensuring
PROFESSOR, OB&HRM, IFIM BUSINESS SCHOOL a robust ecosystem for the healthcare and allied sectors.
Where on the one hand the common man benefits from
a state-sponsored treatment and insurance, Ayushman
Bharat ensures that the mainstream services of healthcare
and insurance also reach-out to the far-flung corners of the
country.

The programme is ambitious and far-reaching to say the
least. The number of beneficiaries to be covered under
this program are over 50 crore. Eligible families will get an
insurance cover of up to Rupees Five lakhs per year. By

“Agame-changer initiative to serve the poor” said 55
Prime Minister Narendra Modi, after the launch
of Ayushman Bharat in September 2018. A
marquee initiative by the government to bring
the large swathes of the population across India and Bharat
under the ambit of state healthcare, Ayushman Bharat is by
far, one of the most ambitious schemes undertaken by any
government in the history of Independent India.

Rolled out simultaneously in more than 450 districts across
the country, ‘Modicare’, as it is popularly touted, is estimated
to be the biggest government-funded health insurance
program globally. More than 100 million of India’s poorest
families – that’s some 500 million people and about 40%
of the population — will get free health coverage. The
insurance will cover more than 1,350 procedures including
cancer treatments, coronary bypass, angioplasty and knee
replacements. It will also include charges for pre-and post-
hospitalization, diagnostics, medicines, etc.

The benefits of the programme have a multitude of benefits

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February 23, 2019, 14,724 government hospitals have been Thus far, till the publishing of this report, over 52 lakh
empaneled by the scheme. people have benefited from the AMRIT (Affordable Medicine
and Reliable Implants for Treatment) pharmacies. These
The Ayushman Bharat Yojana doesn’t just have a national government-owned outposts provide affordable medicines
focus. It is an instrumental tool for the country to ensure for the treatment of cancer and cardiovascular diseases.
that the third Sustainable Development Goal of the United
Nations, (SDG-3). The SDG-3 seeks to “ensure healthy lives There are, as of January 2018, 111 AMRIT pharmacies.
and promote well-being for all at all ages”. The discounted prices at which AMRIT pharmacies sell
their medicines is about 60 per cent to 90 per cent of their
The PMJAY scheme, on its final maximum retail price. At inception itself, AMRIT pharmacies
rollout shall ultimately cover 40% were selling 195 oncology drugs and 186 cardiovascular
of India’s population. drugs at deep discounted prices. ‘Docetaxel 120 mg’ used
for chemotherapy is sold at Rs 888.75 (93 per cent rebate),
The PMJAY scheme, on its final rollout shall ultimately cover when the MRP of the injection is Rs. 13,440.”
40% of India’s population.
5,200 drugs, implants, and
The Government has gone a step further to ensure that disposables are sold at discounts
the citizens benefit from the total stack benefits of state of up to 60 per cent of MRP.
focused reforms. For instance, clubbing PMJAY with the
Government’s focus to provide medicines at a nominal cost, 5,200 drugs, implants, and disposables are sold at discounts
through the Jan Aushadi Scheme. of up to 60 per cent of MRP.

Affordable medicines have been made available at the PM In 2015, the government published the National List of
Bhartiya Janaushadi Kendras. These kendras sell medicines Essential Medicines (NLEM) which has brought 1,054
at almost half the price of branded medicines. At the time essential medicines under governmental price control.
that Narendra Modi became prime-minister, there were only Medicines not deemed essential by the NLEM 2015 are
97 such kendras. also subject to price control. It is thus, not possible for
pharmaceutical companies to raise the price of even non-
Today, more than 3,000 Janaushadi Kendras have been essential drugs indiscriminately.
established The medicines sold by the kendras are generic
in nature, but identical to branded medicines. Costs are Meanwhile, more steps are being taken to ensure that
kept low through the non-incurrence of the research and essential medicines are sold at a fair price. The Department
development costs that branded pharmaceutical companies of Pharmaceuticals’ report titled ‘Report of the Committee
incur. Nonetheless, all the drugs are conformed as per the in High Trade Margins in the Sale of Drugs, 2016’ observes
World Health Organisation (WHO) standards. that “high trade margin enjoyed by distributors-hospital/
retailers are the main reason for cost escalation of drugs and
More than 3,000 Janaushadi medical devices”. As indicated by the work being done at
Kendras have been established NITI Aayog, the government is in process of initiating trade
since the inception of the margin rationalization in the pharmaceutical industry.
programme.
This programme provides free dialysis services to the poor,
More than 3,000 Janaushadi Kendras have been established and subsidized services to all patients. The free dialysis
since the inception of the programme. services are provided in district hospitals and are available
in about 500 such district hospitals. About 2.5 lakh patients

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have availed this service. About 500 dialysis units have been of cardiac stents by 85 per cent, and knee implants by 50 –
made operational. 70 per cent. The maximum price of cardiac stents was set at
Rs. 30,000 in February, 2017.
Around 52 lakh pregnant women will benefit from the
‘Pradhan Mantri Surakshit Matritva Abhiyan’ every year. This The National Pharmaceutical Pricing Authority (NPPA) has
scheme provides BPL women with an annual cash incentive fixed the price of drug eluting stents and bare metal stents
of Rs. 6,000 each. The money is to be used by expecting at Rs.27,890 and Rs.7,400 respectively. Earlier, a coronary
mothers for the purchase and preparation of wholesome, stent could cost as much as Rupees two lakhs. The NPPA
nutritious food during their pregnancy. has reduced the prices of coronary stents in 2018 by 85 per
cent.
As of now, only mothers expecting a first-born are eligible.
BPL mothers expecting a first-born have a legal claim to this A September 2018 study by TALENT has shown that low-
incentive under the National Food Security Act (NFSA). This priced Indian stents are as good as the ones produced by
scheme is being executed through the Maternity Benefits well-known multinational companies. Thus costlier is not
Program (MBP). necessarily better.

The scheme was announced on January 1, 2017 and The unique component of Health and Wellness Centres
received approval from the Union Cabinet in May 2017. (HWCs), at the initial phase and financial protection for
Through the Pradhan Mantri Surakshit Matritya Abhiyan accessibility to curative care at the secondary phase,
and Maternity Benefits Programme, the high maternity through collaboration between the public and the private
mortality rate in India shall decrease. The money is given to sector, is a salient feature of Modicare. These features shall
the beneficiaries through direct bank transfers (DBT), thus have a catalysing effect on startups and disruptive players in
mitigating leakages. the healthcare sector.

1.3 crore ante-natal tests Modicare is a giant stride towards ensuring India’s evolution
were conducted. as a free-market democracy that places unfettered focus
on the well-being of its citizens. The Prime Minister has, in
84 lakh hemoglobin his Vision 2022 promised to make India poverty-free. What
15 lakh ultrasound better way than to begin with implementing reforms that
checkups tests were conducted aims to tackle poverty through healthcare?

The Narendra Modi-led government has reduced the prices

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Chalking A Strategic
Roadmap to Provide Housing

for All by 2022

have been deprived of the basic necessity of a shelter, to
survive. Even though the country witnessed superlative
economic growth and progress, it still ranked extremely
poorly in the HDI (Human Development Index), which was a
measure of human development in terms of education, life
expectancy and per capita income. As per the HDI report,
India was at 0.467 in 2008; meanwhile, in 2018 it rose to
0.639, a substantial leap of 36%.

rajarshi-chakraborty The evolution of the various housing schemes by the different
governments can be divided into four distinct phases; the
assistant professor, ifim business school first phase consists of the developments that took place
during the first two decades post-independence. This was
“Pradhan Mantri Awas Yojana would benefit people the period when the initial schemes and policies of the
who cannot afford a house themselves. It is a government were still being formulated and the government
step towards fulfilment of the vision of Housing was trying to analyse and attend to the problems of various
for All by 2022”, said Prime Minister Narendra segments of the society. The second phase was between
Modi, highlighting the impact of the marquee initiative by the early 1970s till the middle of the 1980s; during this
the government, to ensure that no individual or family would period, the attention shifted to serve the weaker sections of
remain without a shelter. the society.

The Pradhan Mantri Awas Yojana was launched with the The third phase was between the middle 1980s till the early
objective of rehabilitating the present slum dwellers, with the 2000s and during this period the focus was shifted from
participation of the private sector, using land as a resource, physical provision of houses to financing the same.
promoting affordable housing for the weaker sections of the
society through various credit linked subsidies, providing The fourth and the final stage was from early 2000s
affordable housing by forming partnership between the onwards. During this phase it was clearly visible that
government and the private sector. the government was promoting active involvement and
participation of the private sector in providing houses to
Even decades after political independence, millions of Indians the needy, but surprisingly the government reduced its
involvement from these housing activities.

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1950s – 1960s (1st Phase) 1970s – Mid 1980s (2nd Phase)

During the first phase, the central government came out The second phase witnessed a rapid decline in the number
with certain housing schemes which was aimed at providing of Housing Schemes and policies post-realization by the
housing facilities to all the sections of the society. Some of Government that it was quite challenging to provide housing
the prominent schemes that the central government came for all the sections of the society. There was a visible decline
up with are the Subsidized Housing Scheme for Industrial in the schemes and policies that were established by the
Workers in 1952, Low Income Group Housing Scheme in government for different sections of the society apart from
1954, Middle Income Group Housing Scheme in 1959 and the weaker, poor and the socially backward sections of the
Slum Clearance and Improvement Scheme I 1956. society.

The responsibility and accountability were rendered to the The phase projected a complete shift of focus to various
state governments for housing in the rural areas. During the housing schemes and activities aimed at the lower sections
first phase there was a lot of focus in the development of of the society and the other sections were encouraged
institutional capacities to effectively manage the growth in the to get into several housing activities with limited support
urban areas and also to deliver proper and livable housing to from the government. It was also during this phase that
the citizens of the country. the government realized that slum clearance was not the
ultimate solution to the housing problem in the cities.
In view of this, the Central Government had established
plenty of institutions at the state as well as the national The government came out with schemes like Environmental
levels including the National Building Organization, which Improvement Scheme of Urban Slums in the year 1972 and
was established in 1954 and whose main function was to Sites and Services Scheme in the year 1980 to counter the
conduct extensive research in building construction problems with regard to the urban slums. During this phase
activities. it was also noted by the Government the positive impact of
housing on the overall economic growth of the country and
The early 1960s witnessed the establishment of the Town hence the Government created the national level Housing
and Country Planning Organization and also various Housing and Urban Development Corporation (HUDCO) in the year
Boards were established during the same period. The 1970.
primary objective of these Housing Boards was to perform
various housing activities for various sections of the society The objective of establishing HUDCO was to ensure the
with a special focus on the Lower Income Group. promotion of a sustainable development of Urban India and

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a remarkable improvement in the quality of life of the citizens. had also stated that there is insufficiency of funds in it to
As of now HUDCO had built around 3,86, 201 units as per support the extensive urban development and housing
the September 2018 report released by HUDCO. activities and hence the focus was on attracting the private
sector to invest in the sector.
Mid 1980s – Early 2000s (3rd Phase)
This phase witnessed the establishment of schemes like
The third phase was more about liberalization of the Indian Valmiki Ambedkar Awas Yojna, which was merged with
economy. The government was focused on liberalizing the BSUP (Basic Services to Urban Poor) and later to JnNURM
economy and this phase witnessed the entrance of various (Jawaharlal Nehru National Urban Renewal Mission) and
neoliberal policies in India. The economic liberalization was finally it was merged with Rajiv Awas Yojna in 2013.
also visible in the housing policies as well.
This phase also witnessed the allowance of 100% FDI in
Several housing policies were focused upon restricting the housing sector. The government had also declared slum
government interference in housing activities as a provider improvement as a Corporate Social Responsibility activity
of houses and the policies were aimed at promoting the with the main objective of attracting more and more funds
government as a facilitator in the housing process. The focus and investments from the private enterprises. Surprisingly it
was shifted towards the private sector and their efforts in was reported recently that more than two lakhs units are still
providing houses. unoccupied under the Rajiv Gandhi Awas Yojana.

This phase also witnessed the restriction of the role of The Impact
government and narrowing their focus only on improvement
of the slums, providing houses directly to the weaker Post our independence for the first time we saw a clear and
sections of the society and providing lots of support and well defined vision post the launch of the Pradhan Mantri
motivation to the various housing finance institutions. This Awas Yojana on 17th June, 2015, by the NDA government.
phase also witnessed the emergence of various schemes The launch happened with a clear vision of providing a
like Urban Basic Services Scheme (renamed to Urban Basic shelter to every Indian by 2022, when the country turns 75
Services for Poor in 1991) which was established in the year years. The scheme covers aspects of affordable housing,
1986, Nehru Rozgar Yojna’s Scheme of Housing and Shelter basic facilities like proper sanitation, basic infrastructure and
Upgradation, established in the year 1990 and the National a secured environment.
Slum Development program, established in the year 1996.
For the first time in the history of our country, the quantum of
Even though these schemes were designed by the center, home loan touched 10% of the Gross Domestic Product due
it required matching fund requirements from the state to a steep growth in housing credit. The home loan segment
governments and this created a lot of challenges in the has been growing robustly and it is only accelerating at a
implementation of these schemes. This phase witnessed rapid pace due to the growth in the affordability factor.
the establishment of the National Housing bank in 1987 and
along with it various commercial banks and housing finance The Middle Income Group 1 with an average annual income
institutions came into existence and they were constantly of Rupees six lakhs to Rupees 12 Lakhs, which are mainly
encouraged. for the youth population up to the age of 35, are eligible for a
subsidy for homes which are upto 1722 square feet and the
2000s onward (4th Phase) Middle Income Group 2 with an average income of Rs. 12
Lakhs to Rs. 18 Lakhs, who generally belong to the middle
During this phase the government had already established age category, are eligible for a subsidy for units that are upto
itself as the facilitator of housing activities. The government 2,153 square feet.

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If we look examine the MIG-1 category, customers are
eligible for a 4% interest subsidy for a loan amount of
Rupees nine lakhs and for the MIG-2 category, customers
are eligible for a 3% subsidy for a loan amount of upto
Rs. 12 Lakhs. If the customer requires any additional
loan amount, he will be given by the lender but at a non-
subsidized rate.

The Pradhan Mantri Awas Yojana is benefitting the citizens Around 1.13 crore houses have been constructed in the
in a multitude of ways. It is definitely providing affordable last four years and the Government has set a target of
housing opportunities to those from all sections of the constructing 1 crore pucca houses by 31st March 2019,
society. It is also helping the customers get a better value for which is very much in the process if we consider that out
their money as the scheme helps increase the average size of the targeted 1 Crore pucca houses by 31st March 2019,
of the house by 20%-30% considering the ratio between the the targets that are assigned to all the states and Union
super built up and the carpet area. territories are 99.89 Lakhs, the houses sanctioned so far has
been 87.44 lakhs.
An increase in the carpet shall encourage the customers,
especially from the tier I and tier II cities in various aspects. Out of these sanctioned houses, first installment is paid
The scheme has initiated a great impact on the real estate for 81.26 Lakhs houses, 2nd installment is paid for around
sector as well as the industries associated with it. Following 62.52 lakhs and 3rd installment is paid for 49.17 lakhs
are the benefits designed for the Economically Weaker houses. Around 43.54 lakhs houses are completed source.
Section (EWS) of the society and the Lower Income Group These are very promising numbers that shows that the
(LIG) segment. Government is on track towards the completion of the target,
that is to provide shelter to all the citizens of India by 2022,
the year India turns 75.

It has been reported by the National Institute of Public If we also look at the state wise allocation of houses under
Finance and Policy that the time required for the construction the Pradhan Mantri Awas Yojana, the figures are quite
of house under the Pradhan Mantri Awas Yojana has been promising. Following is the data released by the Government
reduced to 114 days from a staggering 314 days, which was with regard to the progress of Pradhan Mantri Awas Yojana
prevalent under erstwhile Indira Awas Yojana. The following state wise
table will give us an idea about the upwards swing in the
construction of houses under the Pradhan Mantri Awas From the above tables it is very clear that the progress is
Yojana. strong enough but the question that remains in everyone’s
mind is that whether the Government will be able to
The above table gives us a clear view of the growth of construct 1 crore urban houses by 31st March 2019. Well,
Pradhan Mantri Awas Yojana and gives us the confidence to the progress has been good but it is extremely necessary for
believe in the success of the scheme. the Government to speed up the entire process if it has to
meet its target.

For the impact to be more effective there is a serious need
for the government to create an enabling ecosystem for
the private builders. For the government to reach its goal

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of constructing 2 crore homes by 2022, it needs to build onus falls on the private builders that demotivates them.
houses at a rate of 30 lakhs per annum.
It has also been noted that around 16 lakhs houses are
One of reasons for this slow rate of growth is the sanctioned for construction by the government for a budget
government’s excessive dependence on the private players. of around Rs 89 crore out of which the government will be
The government is offering and funding upto Rs. 1.5 lakhs funding around a fourth of it.
per house, which is not motivating enough for the private
builders as if we consider cities like the metropolitans, one The Way Forward
cannot have that cheap a price for a house.
One of the major initiatives that the government should resort
There is an uncertainty that exists as to whether the state to in order to speed up the process of affordable housing
governments shall fund this scheme and hence the entire is by encouraging private builders to participate even more.

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There is a need for the Government to streamline the overall the economically weaker section of the society in and around
approval process. the more affluent housings in the major cities.

At present it takes a lot of time for the developers to start the Providing affordable housing is definitely a boost to the
construction of the house after purchasing the land and it is economic strength of the country and it also enhances
common experience for them to go through various offices the livelihood of the several people. Even though we have
of the government before they start the construction and witnessed a lot of established builders are getting benefitted
therefore causing a major delay. from the Pradhan Mantri Awas Yojana, several small time and
unorganized builders are utilizing the Yojana as their playing
There is a need for the government to think about starting ground and they are not following any particular rule book.
with a transparent online approval process that aims at
saving time for the overall approval and should also aim at The main objective of these small time builders is to buy
stopping any form of unethical practices. One of the major land pieces around the outskirts of the major cities and then
obstructions faced by the private developers is the availability build small housing projects that lack the most elementary
of roads, sewage and water along with the land. amenities and facilities. These housings are devoid of the
most basic services like water, connectivity through roads
There is also a need for the state governments to take care and electricity since they fall well outside the municipality
of these issues if we want to see a heavy influx of private limits.
builders. There is also need to revisit the early 2000s and
introduce something similar to what was introduced by the With the vision of housing for all by 2022 it should be the
then Prime Minister Shri Atal Bihari Vajpayee, Section 80 IB primary duty of the government to keep a check on illegal
(10), of the Income Tax Act, that aimed at the promotion of builders and housing projects that are being constructed to
the construction of housing projects. fool customers to a large.

Providing affordable housing is not only about providing a There is a high shortage of land to implement this scheme
roof over the heads of the citizens but also about creating a and till the time enough lands are released to the government
positive and favorable correlation with the economy of the for the smooth implementation of this scheme, the vision
nation. The initiative provides the window for people from might remain a distant dream for many beneficiaries as well
rural and semi-urban areas to migrate to the larger urban as for the government.
centers for employment.
Cost of the land forms a major chunk of the overall ticket-
Affordable housing is a powerful initiative to strengthen size of the housing project. With the RBI not allowing the
the economic status of any city as well as the real estate banks to sanction loans for the purchase of land, the builders
sector. Creation of a talented manpower pool will help in are left with very few options of either forming a joint venture
increasing the demand of opening up of various industries with the land owners or get the land funded by various Non-
and businesses in the cities. Banking Financial Companies (NBFC) in the country, which is
quite an expensive route.
It shall also witness a rise in the demand of retail spaces
around the catchment areas. Affordable housing is also The entire process of availing home loans should be
going to promote its beneficial coexistence with the middle simplified. The present Government under the leadership of
income households since the middle income groups depend Prime Minister Modi is not just capable, but is well-equipped
on the services of the lower income group on a daily basis. to achieve its vision of providing housing to all by 2022.

There has also been a steep rise in the housing activity for

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FINANCIAL INCLUSION

the International Labour Organization (ILO) Declaration of
Philadelphia (1944), which states, “Poverty anywhere is a
threat to prosperity everywhere.”

Dr. Rajendra K Sinha In India, the Financial Inclusion Advisory Committee (FIAC)
set up in 2012 was reconstituted in June 2015 to review FI
Professor & Chairperson, Centre for Excellence in policies on an ongoing basis and to provide expert advice to
Banking, IFIM Business School accelerate FI. FIAC has the mandate to formulate National
Strategy for Financial Inclusion (NSFI). With the obvious
“Financial inclusion has become a reality for 1.3 billion thrust on digital FI, and in line with the international best
Indians. We have generated more than 1.2 billion practices, NSFI also seeks to draw upon the G-20 High-
biometric identities — called Aadhaar or foundation Level Principles for Digital Financial Inclusion, adapted to
— in just a few years. With our Jan DhanYojana, meet India-specific requirements. India has taken massive
we aimed to give a bank account to every Indian. Less than strides towards financial inclusion in the last few years.
50 per cent of Indians had bank accounts in 2014; now, it is
nearly universal”, said Prime Minister Narendra Modi at the India’s first FI index launched in 2013 had four critical
Singapore FinTech Festival in November 2018. dimensions: (i) branch penetration (ii) deposit penetration
(iii) credit penetration and (iv) insurance penetration. The FI
A high priority on the NDA government’s agenda, Modi index is based on data provided by RBI, the Micro Finance
unveiled the Pradhan Mantri Jan Dhan Yojana (PMJDY), on Institutions Network (MFIN), and the Insurance Information
August 15, 2014, soon after winning the majority mandate. Bureau of India.
A flagship initiative that aims to bring huge sections of the
previously unbanked population under the ambit of the Global institutions such as World Bank started measuring
mainstream credit system, the PMJDY is a masterstroke once in three years, beginning 2011, the progress of FI
that hinges on a stack ecosystem for benefits at the multiple across countries through Global Findex. India’s GFX stood
levels, across a multitude of stakeholders. Primarily though, 35 in 2011, 53 in 2014, and 80 in 2017.
the initiative is aimed at an enabling broad-based economic
development. Global Findex Database of the World Bank in 2011 stated
that 40% of adult Indians had a bank account. Seven years
later, according to the Global Findex Database of April
2018, almost 80% of adult Indians have bank accounts.
The significant improvement in FI, reflects on the effective
implementation of the relevant Indian policies in the last few
years.

But what exactly is the scope of financial inclusion? It is Powering this supersonic rise in FI, has been a series
relevant in the context of Financial Inclusion (FI), to quote of financial inclusion measures launched and effectively

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APRIL 01 , 2019 monitored by the government. These include Aadhar,
a biometric database that provides a unique identity
to each Indian citizen; no-frills savings bank accounts
called Jan Dhan accounts (under Pradhan Mantri Jan
Dhan Yojana: PMJDY); the direct benefit transfer (DBT)
of social benefit payments into these BSBDA accounts;
and a digital payment infrastructure named Bharat
Interface for Money (BHIM).

Today about  90% of India’s 1.3 billion population have
a unique Aadhar identity, which is vital for meeting
anti-money laundering “know your customer” (KYC)
requirements. In the last four years, 330 million new  Jan
Dhan accounts have been opened. On the digital front,
the use of digital payments has been rising significantly
as the mobile penetration is expected to reach 90% by
2020 and the internet penetration has been soaring.

The banking infrastructure comprising of bank branches,
ATMs, digital kiosks, customer service points (CSP),
business correspondents (BCs), point of sale (PoS)
terminals and mobile ATM vans currently cover 5,69,547
villages out of the total of close to 6,60,000 villages. Of
these 5,15,317 villages (90.47 per cent) are covered by
BCs offering limited banking services.

With the growing empirical evidence on the potential
development benefits from financial inclusion, the
Reserve Bank of India’s (RBI) agenda has broadened
from the initial focus on provision of credit and making
available savings avenues to a larger remit of diverse
services including transactions, payments and
insurance, while continuing to wean away the financially
disadvantaged sections of the society from informal
sources of funds and the associated coercive practices.

Business Correspondents’ Registry Portal: The role of
business correspondents (BCs) in expanding the reach
of banking services in rural areas is gaining acceptance
and recognition, which is evident from the significant
increase in the number of transactions put through by
BCs through the information and computer technology
(ICT) channel. A registry portal developed by the IBA
on the basis of the framework provided by the Reserve

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Bank was launched in February 2018 to enable banks to Progress of issuance of Kisan Credit Cards (KCC) &
upload data pertaining to BCs employed by them General Credit Cards (GCC )

(Source: FIP returns submitted by banks, Report on Trend
and Progress of Banking in India 2017-18)

March 2010 March 2018 Microfinance Programme: Launched by the National Bank
for Agriculture and Rural Development (NABARD), the self-
Banking Outlets in Rural Banking Outlets in Rural help group (SHG)-Bank linkage programme involves micro-
location location credit extended collectively to small groups to undertake
Branches: 33378 Branches: 50806 productive activities with a view to integrating them into the
Branchless mode: 34316 Branchless mode: 518742 formal financial system. It has emerged as a key intervention
(i.e. BCs) (i.e. BCs) for poverty alleviation through financial inclusion. During
2017-18, 2.3 million new SHGs were credit-linked with
Progress of Banking Outlets in Rural locations banks, and loans of `472 billion (including repeat loans) were
disbursed to these SHGs. On an average, the amount of
Furthermore, the branch authorisation policy recognises savings per SHG and the amount of credit per SHG were
BCs, which provide banking services for a minimum of four `22,405 and `208,683, respectively.
hours per day and for at least five days a week as banking
outlets. This propelled a sizable increase in the number of 2017-18
accounts opened through BCs who are also generating
robust growth in ICT-based banking services. (Source: FIP Loans disbursed by Banks to
returns submitted by banks, Report on Trend and Progress
of Banking in India 2017-18) Self Help Groups :
2.3 million (Rs 472 billion)

Kisan Credit Cards (KCC) & General Credit Cards (GCC): 2014-15 Micro Finance Institutions :
The policy thrust on financial inclusion expanded access Loans disbursed by Banks to 1,922 million (Rs 255 billion)
to credit from institutional sources in rural areas to 69.1
per cent during 2015-16 (NAFIS 2016-17) as against 56 Self Help Groups :
per cent in 2013 (All India Debt and Investment Survey). 1.6 million (Rs 276 billion)
Within non-institutional sources, a significant decline in the
dominance of moneylenders is evident. According to NAFIS Micro Finance Institutions :
2016-17, agricultural households (74.5 per cent) relied much 597 million (Rs 147 billion)
more than non-agricultural households (63.8 per cent) on
institutional sources for their credit needs. Progress of Microfinance Programmes
(Source: NABARD)
March 2018
During the year 2017-18, the amount disbursed through
Kisan Credit Cards: 46 million micro finance institutions (MFIs) rose faster than under
the SHG-Bank linkage programme. The constant efforts
General Credit Card: 12 million in counselling and guiding to bring about a mindset and
March 2010 cultural shift among newly connected beneficiaries to derive
Kisan Credit Cards: 24 million benefits from the formal financial system by borrowing from
General Credit Card:1 million banks and repaying loans in time. This will boost micro and
small enterprises, and hence alleviate poverty and raise the
standard of living of the community at the grass-roots level.

The two futuristic important aspects are, firstly the financial
literacy has to be driven up and secondly, the private sector

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participation in rural and semi-urban areas has to significantly rural & semi-urban areas. Financial services firms need to
go up, for ensuring a sustainable financial inclusion model. come forward innovatively to weave in these uncertainties in
their business models in order to serve these communities
Financial literacy: According to a Standard and Poor’s successfully.
survey, basic financial literacy in India is sub-par. India still
needs to do a great deal of work. Driven by the government The government and providers of various financial products
and regulators such as the Reserve Bank of India, as well partner closely, so the risks and rewards of working with
as voluntary efforts by companies through corporate social marginal populations are shared. For instance, rural housing
responsibility (CSR) programmes, this is changing quite segment is powered by a government programme that
rapidly. provides financial support and participation from the private
sector.
The industry body Association of Mutual Funds of India has
been running a successful campaign to raise awareness The way to address issues of rural India is by providing
about the benefits of investing in mutual funds to create rural communities with additional and alternative income
long-term wealth. The last decade’s growth rate of streams through greater financial inclusion. Microcredit has
investment in mutual funds in India is now double that of the the potential to transform the financially weak into micro-
rest of the world. Interestingly, digital flows into mutual funds entrepreneurs, as well as create jobs in the local community.
have increased 12 times in the last two years.
India has the world’s largest share of young people with
The private sector closer integration with the community the half of the country population below the age of 25, which
will help in bringing about a greater appreciation of the have their soaring ambitions. Financial inclusion will therefore
challenges faced by financially excluded populace i.e. life continue to be the critical economic strategy platform to
being often unpredictable and dependent on variables alleviate poverty and address the people aspirations.
such as weather and uncertain agri-commodity prices in

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Creating Holistic Policy
Environment to Boost

Agriculture

Strengthening the Nations Backbone

Dr. Rajendra K Sinha Developing adequate agri-infrastructure: Large investments
in warehouses and cold storages would prevent post-
Professor & Chairperson, Centre for Excellence in harvest crop losses. The government is promoting value-
Banking, IFIM Business School addition through food processing. Allied activities like
fisheries, poultry, beekeeping etc. have got a thrust. A
“ This is the strength of the farmers of our country corpus of Rs. 10,000 crore was created for infrastructure.
that the production of pulses has increased from The agri-market infrastructure fund of Rs. 2,000 crore was
almost 17 million tonnes to 23 million tonnes set up and Rs. 1,290 crore was allocated under the National
in just one year”, said the Prime Minister at the Bamboo Mission to set up small industries.
National Conference on Agriculture 2022, in February 2018.
The government has taken a series of coordinated measures Provision of adequate irrigation facilities: Under “Pradhan
to improve farmers’ income, reduce wastage and create Mantri Krishi Sinchayee Yojana” (PMKSY) for an outlay of Rs.
alternate sources of income. 50,000 crore for five years (2015-16 to 2019-20), is aimed
at “Har Khet Ko Paani”. There is a special focus on irrigation
Especially, the “Beej se Bazaar Tak” policy interventions of aimed at “per drop, more crop”, with the scheme envisaging
government have been designed to address constraints a coverage of 2.85 million hectares under irrigation and
of farmers at every step. The various initiatives of the 2.69 million hectares under micro-irrigation. A dedicated
government are expected to directly address factors micro-irrigation fund of Rs. 5,000 crore has been assigned
responsible for low productivity. to facilitate farmers to install solar water pumps in field
irrigation. The states will draw their irrigation development
plans under PMKSY, based on district/blocks plans with a
horizon of five to seven years. This is essential to remove
the dependence of marginal & small farmers on vagaries of
monsoons.

Encouraging scientific farming: Providing of soil health cards
to the farmers along with quality seed and neem-coated urea
will improve farmers productivity as also the soil health.

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Credit availability to go up: Insufficiency of credit from against warehouse receipts to discourage distress sale.
formal financial institutions and dependency of landless and
marginal farmers on money lenders, have adverse effect on Enabling adequate marketing facilities: Non-availability of
farmers productivity. The farm credit target for 2018-19 was remunerative marketing avenues impact farmer incomes
raised to INR 11 lakh crore. as they rely upon middlemen. Under the scheme for
“Promotion of National Agriculture Market through Agri-
2017-18 Tech Infrastructure Fund (ATIF)”, it had a budgetary outlay
Rs 11,68,503 Cr of Rs. 200 crore (2015-16 to 2017-18) wherein a common
e-market platform was deployed in 585 regulated wholesale
2016-17 markets.
Rs 10,65,756 Cr
This included one-time fixed cost up to a ceiling of Rs. 30
2015-16 lakhs per ‘mandi’ for hardware, equipment/infrastructure
Rs 9,15,510 Cr besides expenses on software and its customization for the
states.

Total agriculture credit disbursement (Rs. crore) Under e-NAM, over 8.75 million farmers and sellers are
Source: National Bank for Agriculture and Rural Development registered and 16.45 million tonnes of farm commodities
(NABARD) have been transacted so far. E-NAM can be a game-
changer.
Kisan Credit Card (KCC) scheme has since been simplified
with the ATM-enabled RuPay debit card with one-time Remunerative prices: The government announced in July
documentation and built-in cost escalation etc. As of March 2018 a big increase in the minimum support prices (MSP) for
2018, about 69.2 million KCCs were issued. The interest 14 crops, an increase in the scope of the program that the
subvention scheme (2%) for short-term crop loans up to agriculture ministry calls a “paradigm shift”. In October 2018,
Rs. 3 lakhs earlier available for a period of one year, was the government came with increased MSP for Rabi crops for
extended by six months to marginal and small farmers 2018-19 season.

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*Includes all paid out costs such as those incurred including miscellaneous expenses and imputed value of family labor    
Source: Press Information Bureau, Ministry of Agriculture & Farmers Welfare

The information on MSP from the years 2010-11 onwards is it to 33% or more. The farmers get the full minimum support
as per Annexure. price for foodgrains damaged by rains.

Pradhan Mantri Fasal Bima Yojana (PMFBY): The premium The government has revised upward the assistance to the
paid by farmers is very low and balance would be borne by family of the deceased, in case of an eventuality, from the
the government to provide fully-insured amount to farmers earlier INR 2.5 lakhs to INR 4 lakhs. Further, there is a rise of
against crop loss due to natural calamities. The farmers have 82% in the provisions under the State Disaster Relief Fund
to pay a uniform premium of 2% for all Kharif crops, 1.5% (SDRF) to INR 61,220 crore (2015-2020) from an earlier
for all Rabi crops and 5% for commercial and horticulture allocation of INR 33,581 crore (2010-2015).
crops. The government action of removing the earlier cap on
government subsidy is a welcome decision and is in line with The unique aspects of government actions have been the
the “One Nation-One Scheme”. systematic approach in initiating measures for providing
access to good quality seeds, greater access and availability
Aggregation of facilities for uneconomical land holdings: Due of fertilizers, irrigation and the right price for produce.
to the rise in population, division of land take place, which
severely affects farm productivity. Aggregating farmers into Through information and communication technologies, the
Farmer Producers Organization (FPO)/Farmer Interest Group relevant information and services to farmers have been
(FIG) and promoting their tie-ups with Market Aggregators provided on Farmers’ Portal. This is an endeavor to create a
(MAs) and financial institutions (FIs) are among the several one-stop shop for meeting all information needs relating to
initiatives under the Mission for Integrated Development of agriculture, animal husbandry, fisheries sectors, production
Horticulture (MIDH), a centrally-sponsored scheme. and sale/storage of farmer.

Distress Relief: The erstwhile cut-off point for relief to the The farm inputs related information with state-wise dealers
farmers was 50% and more damages to the crops, which are available to facilitate the farmers. Also, the information
the present government made farmers friendly by reducing on seed varieties, soil testing laboratories, Integrated Pest

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Management Plan (IPMP), video clips for farm machinery etc The objective to create a vibrant enabling environment is
are made available on the portal. to enhance the farm household incomes optimally through
concerted efforts, the inter-sectoral complementarities and
Post-harvest support includes information on storage, convergence opportunities, and this has to be ensured
MSP and market prices. Risk Management-related support through synergy amongst the various stakeholders.
exits as guidance for drought management, soil fertility Achieving the objective of doubling farmers’ income by 2022
maps, contingency plans, hailstorms, NADAMS (National would require acceleration in all key strategic initiatives.
Agricultural Drought Assessment and Monitoring System) NITI Aayog (2017) has suggested acceleration in sources
and PMFBY are provided on the portal. underlying growth in output by 33%.

Once on the portal, a farmer would be able to get all The enhancement of farmers’ income will have a far-reaching
information on specific subjects around his village/block/ impact on Indian farmers for the improvement in their per
district or state. This information would be delivered as text, capita income, alleviation of farmers’ distress, upgrading of
SMS, email and audio/video in the language he understands. their lifestyle, and reducing income disparities between farm
They can be reached through the map on the homepage. and non-farm sectors.
Farmers will also be able to ask specific queries and give
feedback through the Feedback Module specially developed The Centre, States, Union Territories and all other
for the purpose. stakeholders have to work optimally in coordination with
each other and stretch their efforts to achieve this much-
The enablers include government (central, state, and local), desired goal.
academia, universities, research institutions, technology
providers, regulatory authorities, financial institutions, The unique aspects of government actions have been the
corporates, market makers, peoples’ institutions, opinion systematic approach in initiating holistic measures aimed at
makers, and above all, the farmers themselves. The giving a thrust to agriculture sector. The doubling of farmers’
collective efforts of all stakeholders will help in creating the income by 2022 is challenging, though attainable through
enabling environment for successful implementation and coordinated and committed efforts of all stakeholders.
execution of policies and plans, in letter and spirit.

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Through Policies,
Schemes For Minorities

and Special Groups

Ensuring An Inclusive India

“ When our government passed the triple talaq Minorities’ issues have taken centre-stage in the political
bill in Lok Sabha, attempts were made to discourse, be it separatist movements, demands for political
stall it in the Rajya Sabha. But we were representation, or the need to protect their religions and
bound by our commitment to freeing our cultures. Meanwhile, the challenge is to enable minorities’
Muslim sisters and daughters from this evil practice. We problems to be discussed.
have made the practice illegal by bringing in an ordinance. It
will be our constant endeavour to get the parliament’s seal of The National Minorities Development & Finance Corporation
approval on this at the earliest,” said Prime Minister Narendra (NMDFC) was incorporated on 30th September, 1994, to
Modi during a public rally in Talcher, Odisha. promote economic activities amongst the backward sections
of the notified minorities through concessional finance.
On February 21, 2019, the Triple Talaq Bill was re-
promulgated. According to reports from the Law Ministry, India has formulated the ‘Prime Minister’s New 15-Point
President Ram Nath Kovind, signed the Muslim Women Programme for the Welfare of Minorities’. The programme
(Protection Rights on Marriage) Second Ordinance, 2019. aims at ensuring a fair percentage of the priority sector
Despite the continuous push by the Government to protect lending to minority communities. The programme is
the rights of Muslim women in the country, its efforts are implemented by the Centre in the States / Pradhan Mantri
falling flat owing to differences of opinion in the Parliament.

The Scheduled Castes (SCs or Dalits are 16% of the
population) and Scheduled Tribes (STs, also called Adivasis,
make up 8%) are at the bottom under the system.

They have been given a special status in the Constitution to
mainstream them. Meanwhile, Muslims, the largest minority,
are on an average worse off than the general population.
Other minority communities do not suffer as much.

India’s indigenous forest-dwellers, Adivasis, too are victims of
the British Raj. But, Adivasis are not a single community.

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Jan Vikas Karyakram (PMJVK) seeks to support the minority The Nai Roshni scheme by the Government of India aims
communities in education, health, skill development etc. to to reach women through NGOs to finance leadership
bridge differences. development training to help them leave their homes and
assume leadership roles.
Multi-sectoral Development Programme (MsDP) is a special
area development scheme to address the development Under the Learn & Earn Policy, the Union Ministry of
deficits in districts with concentration of minority Minority Affairs, Government of India, on 23rd September,
communities. 2013, launched a central scheme for Skill Development of
Minorities. The main objectives of the scheme are:
The Ministry of Minority Affairs through the National
Minorities Development & Finance Corporation (NMDFC) is ●● To cut unemployment among minorities during the
implementing “Artisan Credit Scheme for Minorities”. 12th Plan period (2012-17).
●● To conserve and update traditional skills and link
The government has taken up initiatives for the welfare and them with the market.
upliftment of minorities:- ●● To improve employability of workers, school dropouts
and ensure their placement.
●● USTAAD: The Scheme aims to upgrade Skills and ●● To generate means of better livelihoods for
Train to preserve traditional   Ancestral Arts/Crafts of marginalised minorities.
minorities. ●● To enable minorities to avail opportunities in the
●● Hamari Darohar: The Scheme aims to preserve the market.
heritage of minority communities in context of Indian ●● To develop potential human resource for the country.
culture.
●● Khwaza Garib Nawaz Senior Secondary School will The Centre has introduced an ‘interest subsidy’ for minority
be established at Ajmer by Maulana Azad Education students for overseas studies. This came into force during
Foundation (MAEF) to give a fillip to minority education. 2013-14 for courses sanctioned by the bank under IBA
●● Nai Manzil: A bridge course to bridge the academic model scheme..
and skill development gaps of the Madrasa passouts
with their mainstream counterparts. If the student is eligible, the Centre extends full interest
●● Strengthening State Wakf Boards: The scheme aims subsidy during the moratorium. (course period plus one year
to meet training and administrative costs of State or six months after getting employment, whichever is earlier).
Wakf Boards, and removalencroachment of
properties. Meanwhile, the Nalanda Scheme Centre, has launched the
Nalanda Project for Minorities Higher Educational Institutions
on 4 March, 2014. Nalanda Project is a Faculty Development
Program. The project is being taken up at Aligarh Muslim
University (AMU).

The Constitution protects the interests of the minorities and
recognises their rights to conserve their languages, scripts or
culture, and establish and administer educational institutions
of their choice. While the Constitutional discourse is flawless,
the government and the pillars of Indian democracy are
leaving no stones unturned to ensure that a focused
approach towards the issues of notified minorities.

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Digital India: Building A
Digital Infrastructure

for India

Foundation for a future ready India

flagship programme of the government of India with a vision
to transform India into a digitally empowered society and
knowledge economy.

pritam ghosh Ravi Shankar Prasad, the Minister for IT, said post the
launch of the initiative, “Digital India is more for the poor and
underprivileged. It aims to bridge the gap between the digital
haves and have-nots by using technology for citizen.” These
words succinctly sum up the pivotal role that the initiative
heralds for the masses from the Himalayas to the hinterland.

assistant professor of law, ifim law school The following are the approach and Methodology for Digital
India Programme:
“Isee technology as a means to empower and as a
tool that bridges the distance between hope and i. Ministries / Departments / States would fully leverage
opportunity. Social media is reducing social barriers. It the Common and Support ICT Infrastructure
connects people on the strength of human values, not established by GoI. DeitY would also evolve/ lay
identities”, said Prime Minister Narendra Modi, during his trip down
to Silicon Valley, a couple of months after the launch of Digital standards and policy guidelines, provide technical
India. The government’s marquee initiative to leverage the and handholding support, undertake capacity
digital infrastructure for inclusive development, Digital India building, R&D, etc.
forms the level playing field between India and Bharat.
ii. The existing/ ongoing e-Governance initiatives
Digital India was launched by the Prime Minister of India would be suitably revamped to align them with the
Narendra Modi on 1st July 2015, with an objective of principles of Digital India. Scope enhancement,
connecting rural areas with high-speed Internet network and Process Reengineering, use of integrated &
improving digital literacy under Ministry of Electronics and interoperable systems and deployment of emerging
Information Technology. The Digital India programme is a technologies like cloud & mobile would be
undertaken

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to enhance the delivery of Government services to benefits.
citizens.
viii. Restructuring of NIC would be undertaken to
iii. States would be given flexibility to identify for inclusion strengthen the IT support to all government
additional state-specific projects, which are relevant departments at Centre and State levels.
for their socio-economic needs.
ix. The positions of Chief Information Officers (CIO)
iiii. e-Governance would be promoted through a would be created in at least 10 key Ministries so
centralised initiative to the extent necessary, to that various e-Governance projects could be
ensure citizen centric service orientation, designed, developed and implemented faster. CIO
interoperability of various e-Governance applications positions will be at Additional Secretary/Joint
and optimal utilisation of ICT infrastructure/ resources, Secretary level with over-riding powers on IT in the
while adopting a decentralised implementation model. respective Ministry.

v. Successes would be identified and their replication India comprises of 15 per cent of the world population,
promoted proactively with the required productization and with a growth rate of 7 to 8 per cent, the country can
and customisation wherever needed. very well become the second largest economy by 2030. To
achieve this, the government considers the digital economy
vi. Public Private Partnerships would be preferred as the primary growth enabler.
wherever feasible to implement e-Governance
projects with adequate management and strategic By implementing digital payment methods, like Digital Point
control. of Sale (Digital POS), Unified Payments Interface (UPI),
mobile wallets, Mobile Point of Sale (mPOS), etc., India is
vii. Adoption of Unique ID would be promoted to facilitate moving towards creating a digital economy that will benefit
identification, authentication and delivery of the people and the government in various ways. Some of

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the primary advantages that government witnesses from the thus it is convenient for people to access the
digital economy are: information they need on the go. Digital economy will
definitely pave a way to e-governance, where delivery
1. Removal of Black Economy: When the transactions of all government services would be done
are made digitally, they can be easily monitored. electronically.
Any payment made by any customer to any
merchant will be recorded. This way, there will be no 5. Creation of new jobs: The digital economy has a
means for illegal transactions to occur. By restricting lot of potential to enhance job opportunities in new
the cash-based transactions and using only digital markets as well as increasing employment
payments, the government can efficiently expel the opportunities in some of the existing occupations in
black economy. the government. This way, the unemployment rate in
the country is bound to decrease.
2. Increase in Revenues: This is one of the most
obvious and common benefits of the digital As Abraham Lincoln, the 16th President of the USA,
economy. When the transactions are digitized, famously said, “Government of the people, by the people,
monitoring sales and taxes becomes convenient. for the people, shall not perish from the earth.” Whatever the
Since each transaction is recorded, the customers government benefits from digital economy, directly have a
will get a bill for their purchase, and the merchants positive impact on every citizen’s life.
are bound to pay the sales tax to the government.
This, in turn, increases the revenue of the government However, the let-down here is that according to the World
– thus resulting in growth of the overall financial Bank, “nearly a billion Indians are still not able to tap the
status of the country. benefits of a digital economy.” To move towards a digital
India and achieve a better growing economy, every single
3. Empowerment to People: One of the biggest citizen must use digital payments even for their petty
advantages of moving towards digital economy expenditures.
is that it gives an empowerment to the citizens.
When the payments move digital, each and every The journey of e-Governance initiatives in India took a
individual is bound to have a bank account, a mobile broader dimension in mid 90s for wider sectoral applications
phone, etc. This way, the government can easily with emphasis on citizen-centric services. Later on, many
transfer the subsidies directly to Aadhaar-linked
bank accounts of people. In short, people no longer “E-Governance is an essential
have to wait to receive the incentives and subsidies part of our dream of
that they are bound to receive from the government.
This feature is already in place in most cities. DIGITAL INDIA, the more
One example of that would be the LPG subsidy that technology we infuse in
government gives to the common people. This Governance, the better it is for
subsidy payment is done via bank transfers these
days. INDIA.”

4. Paves the way to e-governance: The quicker, -Shri Narendra Modi
safer, and more efficient alternative to traditional
governance, e-governance will be the ultimate
outcome of the digital economy. From birth certificate
to death certificate, everything is available online –

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States/UTs started various e-Governance projects. Though accountability through mandated delivery of government’s
these e-Governance projects were citizen-centric, they could services electronically.
make lesser than the desired impact.
Infrastructure as a utility to
The Government launched National e-Governance Plan every citizen:
(NeGP) in 2006. As a part of the initiative, 31 Mission Mode
Projects covering various domains were initiated. Despite the High speed internet shall be made available in all gram
successful implementation of many e-Governance projects panchayats; Cradle to grave digital identity; Mobile and
across the country, e-Governance as a whole has not been Bank account would enable participation in digital and
able to make the desired impact and fulfil all its objectives. financial space at individual level; Easy access to common
service centre within their locality; Shareable private space
It has been felt that a lot more thrust is required to ensure on a public cloud; and Safe and secure cyber space in the
e-Governance in the country promote inclusive growth country.
that covers electronic services, products, devices and job
opportunities. Moreover, electronic manufacturing in the Governance and Services
country needs to be strengthened. on Demand:

In order to transform the entire ecosystem of public services Single window access to all persons by seamlessly
through the use of information technology, the Government integrating departments or jurisdictions; availability of
of India has launched the Digital India programme with the government services in online and mobile platforms;
vision to transform India into a digitally empowered society All citizen entitlements to be available on the Cloud to
and knowledge economy. ensure easy access; Government services to be digitally
transformed for improving ease of doing business; Making
The Vision of digital India is to transform the country into financial transactions above a threshold, electronic and
dignity empowered society and knowledge economy. cashless; and Leveraging GIS for decision support systems
It would ensure that government services are available and development.
to citizen electronically. It would also bring in public

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Digital empowerment of citizens: Agmarknet portal. Currently, the apps is available in English
and Hindi languages.
Universal digital literacy; All digital resources universally
accessible; All government documents/certificates to be Centre for Excellence for Internet Of Things (COE-IT):
available on the Cloud; Availability of digital resources/ The Centre of Excellence for IoT was announced as a part
services in Indian languages; Collaborative digital platforms of the Digital India Initiative to jump start the IOT ecosystem
for participative governance; Portability of all entitlements for taking advantage of India’s IT strengths and help the country
individuals through the cloud. attain a leadership role in the convergent area of hardware
and software. The main objective of the center is to create
Accessible India Campaign Mobile App: Sugamya innovative applications and domain capability. Additionally,
Bharat Abhiyaan or Accessible India Campaign is a nation- the center will help build industry capable talent, start-up
wide flagship campaign for achieving universal accessibility community and an entrepreneurial ecosystem for IOT.
that enables people with disabilities to gain access for equal
opportunity, live independently and participate fully in all Crime and Criminal Tracking Network & Systems
aspects of life in an inclusive society. The campaign targets (CCTNS): Crime and Criminal Tracking Network &
at enhancing the accessibility of built environment, transport Systems (CCTNS) is a plan scheme conceived in the light
system and Information and communication ecosystem. of experience of a non-plan scheme namely - Common
The mobile application is a crowd sourcing platform to Integrated Police Application (CIPA). CCTNS aims at creating
comprehensively obtain information on inaccessible places a comprehensive and integrated system for enhancing the
across the country. The mobile application is available on efficiency and effectiveness of policing through adopting
IOS, Android and Windows platform and can be downloaded of principle of e-Governance and creation of a nationwide
from the respective App Stores. networking infrastructure for evolution of IT-enabled-state-
of-the-art tracking system around ‘Investigation of crime and
Agrimarket App: The mobile application has been detection of criminals’.
developed with an aim to keep farmers abreast with the
crop prices and discourage them to carry-out distress sale. Cyber Swachhta Kendra: Cyber Swachhta Kendra
Farmers can get information related to prices of crops in (Botnet Cleaning and Malware Analysis Centre) is a part of
markets within 50km of their own device location using the the Government of India’s Digital India initiative to create
AgriMarket Mobile App. This app automatically captures the a secure cyber space by detecting botnet infections in
location of the farmers using mobile GPS and fetches the India and to notify, enable cleaning and securing systems
market prices of crops which fall within the range of 50km. of end users so as to prevent further infections. It is set
The prices of agriculture commodities are sourced from the up in accordance with the objectives of the ‘National

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Cyber Security Policy’, which envisages creating a secure involving the common citizen and experts with the ultimate
cyber eco system in the country. This centre operates in goal to contribute to the social and economic transformation
close coordination and collaboration with Internet Service of India.
Providers and Product/Antivirus companies.
National Voters Service Portal (NVSP): The portal was
Digilocker: DigiLocker is the Indian Government’s flagship developed with an aim to provide single window service
program aimed at transforming India into a digitally electors. Through NVSP, a user can avail and access various
empowered society and knowledge economy. DigiLocker services such as access the electoral list, apply for voter id
ties into Digital India’s visions areas of providing citizens a card, apply online for corrections in voter’s card, view details
shareable private space on a public cloud and making all of Polling booth, Assembly Constituency and Parliamentary
documents/certificates available on this cloud. Targeted at constituency, and get the contact details of Booth Level
the idea of paperless governance, DigiLocker is a platform officer, Electoral Registration Officer, among other services.
for issuance and verification of documents & certificates in a
digital way, thus eliminating the use of physical documents. Nirbhaya App: Be Fearless is an android emergency
application, which can send a distress call or emergency
E-hospital: e-Hospital@NIC (link sends e-mail) is an open message to a specified contact or group in an emergency
source health information management system (HMIS) which situation faced by a woman or any other individual in general.
is configurable and easily customizable with multi-tenancy Correct Location, Information and Communication, with
support. It is designed to deploy in cloud infrastructure and from the app is dependent upon the basic hardware/
to manage multiple hospitals seamlessly. The generic software requirements, like - Active Data plan, SMS plan,
application addresses all major functional areas of a hospital. minimum talk time and active GPS functionality.
A workflow based HL7 compliant and ISO/IEC 9126 certified
end-to-end solution Software for hospital management Pradhan Mantri Kaushal Vikas Yojana (PMKVY):
which covers complete treatment cycle of OPD/IPD as well Pradhan Mantri Kaushal Vikas Yojana (PMKVY) is the
integrates clinical, administrative, and billing/ insurance flagship scheme of the Ministry of Skill Development
activities. & Entrepreneurship (MSDE). The objective of this Skill
Certification Scheme is to enable a large number of Indian
E-VISA: The Ministry of Tourism supported the initiative youth to take up industry-relevant skill training that will
regarding the implementation of Tourist Visa on Arrival help them in securing a better livelihood. Individuals with
enabled with Electronic Travel Authorisation (ETA) (renamed prior learning experience or skills will also be assessed and
as e-Tourist Visa) strongly and committed all support to certified under Recognition of Prior Learning (RPL).
Ministry of Home Affairs and Ministry of External Affairs and
Ministry of Civil Aviation for implementing this programme. While India faces legacy-driven roadblocks that are
The e-Tourist Visa enables the prospective visitor to apply hampering an accelerated development of physical
for an Indian Visa from his/her home country online without infrastructure, the country is a global leader in developing
visiting the Indian Mission and also pay the visa fee online. state-of-the-art, digital infrastructure. A digitally connected
India can help in improving social and economic condition
MyGov: MyGov platform is a unique path breaking initiative of people living in rural areas through development of
which was launched by the Hon’ble Prime Minister of non-agriculture economic activities apart from providing
India, Shri Narendra Modi. It is a unique first-of-its-kind access to education, health and financial services. A highly
participatory governance initiative involving the common responsive Digital India campaign, that delivers on promises
citizen at large. The idea of MyGov brings the government is the best way forward to build a future-ready India that can
closer to the common man by the use of online platform leverage its skills and demographics to leap ahead of the rest
creating an interface for healthy exchange of ideas and views of the world.

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Ushering A New India
Through Policies Focused

on Youth Development

Ensuring the Demographic Dividend

world’s most promising major economy? From
announcing the Skill India initiative, to placing
development of youth at the centre of the
government policy, the Prime Minister has been
instrumental in promoting the interests of the
youth and building a strong roadmap for their
excellence.

SATISH KUMAR Not many governments post-independent India had made
a serious effort towards reforms that would focus only
PROFESSOR, MARKETING IFIM BUSINESS SCHOOL on skill development. Today as the world is increasingly
moving towards skills-based roles and expertise, India’s
“Just imagine, today India is the youngest country demographic dividend is yet to garner its full potential, as a
in the world. A nation with the oldest civilization result of lack of adequate skills among the larger swathes of
is also the youngest country in the world. What a the young population.
beautiful coincidence, what amazing amalgamation.
A nation whose 65% population is less than 35 years old, The issue of job creation in itself is a case in point. The
a nation whose youth is incredibly tough, whose fingers government had been accused of creating a jobless
have the deftness to be connected with the world via economic growth during its tenure. However, official data
computers, a nation whose youth is determined to create and the government’s razor-sharp focus towards youth and
its own future, that nation now does not need to look entrepreneurship prove otherwise.
back”, said Prime Minister Narendra Modi from Madison
Square Garden, New York, on 28th September, 2014.What Citing Employees’ Provident Fund (EPF) and Employees’
could be a greater source of inspiration for the State Insurance Corporation (ESIC) data, the Prime Minister
youth of India than to witness the stupendous quoted on a public speaking forum, “Even if one assumes
rise of Narendra Modi, from a humble tea-seller there is 50 per cent overlap between EPFO and ESIC data,
to becoming the Prime Minister of India, the 1 million people joined the formal sector in a month. This
means 12 million jobs were created in the formal sector in a
year in these four years.”

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As the Prime Minister suggested, the formal sector has been faces acute shortage of well-trained, skilled workers. It is
witnessing fairly robust year on year growth. If one takes estimated that only 2.3 % of the workforce in India has
into consideration the creation of jobs, the incomes and the undergone formal skill training as compared to 68% in the
impact on the economy, of the informal sector, the picture UK, 75% in Germany, 52% in USA, 80% in Japan and 96%
is bound to be radically different. Unfortunately, hardly does in South Korea. Large sections of the educated workforce
that data exist. have little or no job skills, making them largely unemployable.
Therefore, it is important for the Government of India to scale
The government has already taken strides to address up skill training efforts to meet the demands of employers
these. During the Union Budget 2019, the Finance and drive economic growth.”
Minister announced a nationwide pension scheme for the
unorganised sector. Eventually launched on March 6, 2019, More than 54 per cent of the total population in India
the Pradhan Mantri Shram Yogi Maandhan (PM-SYM), is below 25 years of age, while over 62 per cent of the
promises an assured payment of Rs 3,000 per month, with a population in the working age group (15-59 years). The
contribution of Rs 100 per month, for workers in unorganised country’s population pyramid is expected to bulge across the
sector after 60 years of age, offering them a security net for 15-59 age group over the next decade.
their old age.
This demographic advantage is predicted to last only until
While an unprecedented initiative in itself, what the PM- 2040. India therefore has limited time to take advantage
SYM does is that, it provides a concrete framework for of its demographic advantage by providing proper skills to
the amalgamation of the workers in the sector into the this young population. India’s economy is currently growing
mainstream formal economy, while at the same time within a range of 6.1 percent to eight percent (in 2016-17
providing for a credible channel to provide statistical data on and in Q4 of 2017-18, respectively).
the sector.
The country is expected to grow even faster with its
According to a communique by the government on the demographic dividend, high in investment and savings rates,
National Mission for Skill Development, “India currently with the resource allocation for infrastructure. Investment in

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skills development will foster the economic and employment consist of a Governing Council for policy guidance at apex
growth. level, a Steering Committee and a Mission Directorate
(along with an Executive Committee) as the executive arm
The Skill India is a campaign launched by Prime Minister Sri of the Mission. Mission Directorate will be supported by
Narendra Modi on 15th July, 2015, is a marquee initiative three other institutions: National Skill Development Agency
to train our young population for skills. The initiative aims to (NSDA), National Skill Development Corporation (NSDC),
train over 400 million people across the length and breadth and Directorate General of Training (DGT) – all of which will
of the country in different skills by 2022. have horizontal linkages with Mission Directorate to facilitate
smooth functioning of the national institutional mechanism.
It includes various initiatives of the government like ‘National Seven sub-missions proposed to act as building blocks for
Skill Development Mission’, ‘National Policy for Skill achieving overall objectives of the Mission are:
Development and Entrepreneurship, 2015’, ‘Pradhan Mantri
Kaushal Vikas Yojana (PMKVY)’ and the ‘Skill Loan scheme’. (i) Institutional Training (ii) Infrastructure (iii) Convergence (iv)
Trainers (v) Overseas Employment (vi) Sustainable Livelihoods
The National Skill Development Mission was approved by the (vii) Leveraging Public Infrastructure
Union Cabinet on 1st July 2015, and officially launched by
the Hon’ble Prime Minister Sri Narendra Modi on 15th July The National Skill Development Corporation India (NSDC)
2015 on the occasion of World Youth Skills Day. The Mission was setup as a one of its kind, Public Private Partnership
has been developed to create convergence across sectors Company with the primary mandate of catalysing the skills
and States in terms of skill training activities. landscape in India. It is based on the following pillars:

Further, to achieve the vision of ‘Skilled India’, the National ●● Create large and good quality vocational
Skill Development Mission would not only consolidate institute.
and coordinate skilling efforts, but also expedite decision ●● Reduce risk by providing patient capital.
making across sectors to achieve skilling at scale with Including grants and equity.
speed and standards. It will be implemented through a ●● To enable the creation and sustainability
streamlined institutional mechanism driven by Ministry of Skill of support systems required for skill
Development and Entrepreneurship (MSDE). development. This includes the Industry
led Sector Skill Councils.

Key institutional mechanisms for achieving the objectives Pradhan Mantri Kaushal Vikas Yojana (PMKVY) is the
of the Mission have been divided into three tiers, which flagship scheme of the Ministry of Skill Development &

Entrepreneurship. The objective is to enable
a large number of Indian youths to take up
industry-relevant skill training that helps them in
attaining better livelihood.

Individuals with prior learning experience or
skills will also be assessed and certified under
Recognition of Prior Learning (RPL). Under this
Scheme, Training and Assessment fees are
completely paid by the Government.

The objective of the National Policy on Skill
Development and Entrepreneurship, 2015

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will be to meet the challenge of skilling at scale with speed Several national flagship schemes such as Make in India,
and standard (quality). It will aim to provide an umbrella Start-up India, Stand-up India (a bank loan programme
framework to all skilling activities being carried out within the to assist Scheduled Caste, Scheduled Tribe and women
country, to align them to common standards and link the borrowers to set up a greenfield enterprise), and digital India,
skilling with demand centres. have been launched to spur the creation of more productive
and higher skilled micro, small and medium enterprises,
The Skill Loan Scheme has replaced earlier Indian Banks which would accelerate labour demand and job creation.
Association (IBA) Model Loan Scheme for Vocational The Atal Innovation Mission endeavours to promote a culture
Education and Training. The Indian Banks Association (IBA) of innovation and entrepreneurship by providing a platform
has already circulated the scheme to the Chief Executives for the generation and sharing of innovative ideas, alongside
of All Member Banks for implementation of the Scheme. an incubator to mentor and support innovators.
Any Indian National who has secured admission in a course
run by Industrial Training Institutes (ITIs), Polytechnics or in The United Nation’s priority group on skilling,
a school recognised by Central or State Education Boards entrepreneurship and job creation partners with the
or in a college affiliated to recognised university, training Government of India to provide labour market information
partners affiliated to National Skill Development Corporation systems, extend support for school-to-work transition
(NSDC) Sector Skill Councils, State Skill Mission, State Skill strategies, as well as help improve the targeting, quality and
Corporation can avail loan for the purpose. delivery of employment and skills training programmes at the
state level.
The government has set up the Ministry of Skill Development
and Entrepreneurship (MSDE), to facilitate job creation and It supports the government’s initiatives on job creation and
entrepreneurship, as well as attract private investment. Steps entrepreneurship programmes to ensure that young people,
are also being taken to attract foreign direct investment and women, migrant workers and other marginalised groups are
enhance manufacturing growth. included. Efforts are concentrated in low-income states and
districts and the North-East, and sectors including micro,
The Pradhan Mantri Kaushal Vikas Yojana (Skill India Mission) small and medium enterprise (MSME) development, rural
is MSDE’s flagship scheme to enable young Indians to labour markets, labour intensive manufacturing, infrastructure
take up industry-relevant skills training and improve their development and new sectors such as green industry and
employability. The government’s commitment in imparting affordable housing.
skills training to young Indians thereby making them
competitive in the labour market. To achieve this, following The group provided support to the Government of Mizoram
initiatives have been taken: on a skill-gap assessment and the formulation of a skill
development and entrepreneurship policy. It also collaborates
1. Deen Dayal Upadhyaya Grameen Kaushalya Yojana with Ministry of Skill Development and Entrepreneurship
2. Pradhan Mantri Kaushal Vikas Yojana (MSDE) on promoting entrepreneurship and supported the
3. Financial Assistance for Skill Training of Persons with India consultation of the UN Secretary-General’s high-level
Disabilities panel on women’s economic empowerment and its
4. National Apprenticeship Promotion Scheme follow ups.
5. Craftsmen Training Scheme
6. Apprenticeship training Job Creation in 2017
7. Pradhan Mantri Kaushal Kendra
8. Skill development for minorities The employment created in 2017, is assessed in two
9. Green Skill Development Programme separate age-groups—15-24 and 25-64. The two sources of
data are the recent provident fund (EPFO) data for the age-

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group 15-24, and the CMIE employment data for the 25-64 lakh) under three of its programmes–the Short Term Training
age group. The EPFO data refers to the net additions of programme, Recognition of Prior Learning (RPL)–which
employees in the formal, provident fund payment sector. For certifies people who are already skilled after a short training
the six-month period September 2017-February 2018, total and assessment, and special projects–such as trainings
net additions in the 18-21 age-group was 1.1 million; in the for the disabled, training of the railway catering staff, digital
22-25 group (college graduates?), net additions were lower literacy for street vendors–according to data provided by the
at 0.8 million. Even after allowing a reasonable amount of ministry.
job-hopping (20%), the EPFO data suggests that in 2017, 3
million jobs were added in the 15-24 age group. For the 25- 15 Million Jobs in 2017
64 age group, the CMIE data shows that total employment
creation in 2017 was 12 million. Total job-creation in 2017 It appears that 15 million jobs were created in 2017, not
was 15 million. much different than the Vajpayee average of five years.
Between 1999-2004, 11 million jobs were created each
In July 2016, the Indian government revamped the PMKVY. year (weekly status definition of employment, closest to
In the second edition of the programme, the PMKVY (2016- the daily status CMIE definition; the usual status definition
2020) placements went up from 17.3% of those certified gives an increase of more than 12 million a year). Between
in the short -term training of the first programme to 46.5%, 2004 through 2011, the government could achieve an
government data show. Still, over half of those certified had employment gain of less than 4 million a year.
not got a job until at least three months after the certification,
according to data from the programme’s online dashboard. The interpretation of the data suggests that in economic
terms, the Modi period 2014-2018 has delivered the best
A successful Skill India programme would benefit the macro-economic performance ever in India—several
country–India is expected to have the largest workforce in economic reforms, steady GDP growth, low inflation, and
the world by 2025. By the same year, the world is expected robust job-creation.
to face a shortage of 56.5 million skilled workers, while
India is projected to have a surplus of 47 million, Of the 960,000 who had been certified under the Short
Indian government statistics show, as IndiaSpend reported in Term Training programme by March 7, 2018, 46.5% had
July 2017. been placed by May 30, 2018, according to data from the
PMKVY dashboard.
Yet, 30% of India’s youth are neither employed nor in
education or training, Bloomberg reported on July 7, 2017. The placement numbers, though higher than the first
Unless employed gainfully, India’s “demographic dividend” PMKVY, show that over half of those who completed the
could turn into a socio-economic nightmare. short training and were certified were still without a job at
least three months after certification. The PMKVY 2016-2020
Data suggests that out of the 1.45 million who were certified gives a timeframe of 90 days from date of certification to
through the PMKVY between July 2015 and July 2016, place the candidates.
252,223, or 17.3%, were placed in jobs.
The number of placed candidates is higher if those certified
From July 2016, the government started a new version of the under RPL–who are likely to have been employed or self-
PMKVY. The second edition improved the first programme, employed even before the training–are included. Sixty
and made several changes including third party inspection, percent of certified candidates of all three programmes
added soft skill and entrepreneurship modules to the combined were placed within 90 days of their certification as
trainings, and linked the programme to placements. By May on June 5, 2018.
31, 2018, the PMKVY 2 had trained about 2.84 million (28.4

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With more female respondents expressed
their interest in participating in skill
development programs, 19% of the
females have already enrolled in such
a program as compared with 26% of
males. While over three-fourths of all
females respondents were not aware of
any government-run skill development
program, a half of females indicated time
constraints that inhibited their program
enrolment.

Though the Narendra Modi led government is According to the survey, nearly 51% of
aiming to skill 40 crore people by 2022 through the youth in the country perceive the lack
its ‘Skill India’ program, the lack of awareness of professional guidance in identifying jobs that match their
among youth about the government-run skill skills to be the main obstacle in searching for a desirable
development programs is one of the key obstacles with job. On the other side, nearly 34% of youth reported being
about 70% of Indian youth is not aware of these schemes, neither employed nor in education.
according to a recent study “Young India and Work” by the
Observer Research Foundation and World Economic Forum “In the context of technological adoption and digitisation,
(WEF). jobs and tasks, along with the competencies required to
execute them, are changing. 86% of youth feel very or
Almost 6,000 youths between the age group of 15 and moderately up to date with changes in skills requirements.
30 were surveyed about education, employment and Yet, 39% of youth feel very prepared or prepared for their
their aspirations. The study throws lights on the potential ideal job, while 16% of youth feel either not prepared or very
misalignment between youth and government, as well unprepared for their ideal job,” it said.
as between youth and industry. It showed that there is a
disconnect between the government-run skill development While higher education degrees are highly valued, youth are
programmes and youth sentiments. also eager to learn new skills. According to the survey, 96%
of the respondents hope to get a bachelor’s degree or higher
About three-fourths of the youth in the country has never 84% of the youth surveyed consider a university degree or
enrolled for a skill development program, the findings post-graduate degree as a requirement for their ideal job.
showed. The low training participation was mainly on
account of financial and time issues. The findings showed India is one of the youngest nations in the world, with
that 76% of the respondents were interested in pursuing over 62% of the population in the working age group.
skills development training. Approximately 250 million young people will be joining the
workforce over the next decade. The government had
As identified by respondents in the survey, the characteristics launched the Skill India initiative, which aims to train over 40
of attractive skills programmes include moderate time crore people in India in different skills by 2022. Since then,
commitment, monetary compensation, certification, and various schemes have been launched like Pradhan Mantri
a mix of online and classroom content. Youth consider Kaushal Vikas Yojana (PMKVY) to further the aim of skill
the public sector as ideal providers for skill development development, in order to enable a large number of youths in
opportunities, followed by public-private partnerships. the country to take up industry-relevant skill training that will
help them in securing a better livelihood.

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The Government of India aims to skill 402 million people While Make in India would boost manufacturing sector
between now and 2022. Out of these, at least 110 million in India and create more jobs, Skill India aims to provide
workers are required in over 25 select sectors such as a job-ready human workforce to the industry to enhance
textiles, automobiles, construction, banking and retail. productivity resulting in economic growth. The Prime Minister
launched the Pradhan Mantri Kaushal Vikas Yojana (PMKVY),
According to Prime Minister Sri Narendra Modi, India needs the skill and entrepreneurship ministry’s flagship skill training
to emerge as the global capital of human resources, the way scheme that aims to incentivize skill training by providing
China is the factory of the world. Noting that India will have a financial rewards to candidates who successfully complete
surplus manpower of 40 to 50 million over the next decade, approved skill training programmes.
Modi emphasized the need to provide this manpower with
the skills and ability needed to tackle global challenges, Over the next year, PMKVY aims to skill 2.4 million youth,
warning that the demographic dividend would otherwise across India. For the first time, the skills of young people
become a challenge. According to Sri Narendra Modi, for who lack formal certification, such as workers in India’s vast
India, employment generation and skill development are the unorganised sector, will be recognised. Through an initiative
top priorities. According to him if China is recognised as the known as ‘Recognition of Prior Learning’ (RPL), a million
‘manufacturing factory’ of the world, India can become the youths will be assessed and certified for the skills that they
‘human resource capital’. He also said already possess. Prime Minister also launched a Skill Loan
scheme under which bank loans ranging from Rs.5,000 to
said the country needs to have a “futuristic vision” and draw Rs.1,50,000 will be made available to 3.4 million youths
up plans for the next 10 years. There is a need for mapping seeking to attend skill development programmes over the
job requirements for both domestic and global markets and next five years.
then planning the skill development targets accordingly.
There is need to train youth keeping in mind jobs and The Government of India also launched a skill card, which
development. can be used by employers to verify the training credentials
of job seekers. The Union cabinet recently approved the
According to S. Ramadorai, former Managing Director merger of the National Council for Vocational Training
and CEO of Tata Consultancy Services and Chairman of (NCVT) and the National Skill Development Agency (NSDA)
the National Skill Development Agency, Skill India mission to “consolidate fragmented regulatory structures” and
had taken centre stage with the prime minister throwing improve the outcome of the Skill India mission. The merged
his weight behind it. “The social and economic impact of entity would be called the National Council for Vocational
building skills has taken centre stage. Skill is a national Education and Training (NCVET).
agenda... and building skill is also a business opportunity,”
he said.Ramadorai underlined the need for an ecosystem, As recently as in December 2018, the Prime Minister
giving the example of the US’s Silicon Valley. While skill introduced the 4E approach for the youth—education,
training is important, he said, promotion of entrepreneurship employment, entrepreneurship and excellence that
is equally vital. summed up the roadmap for the section of the population.
The quantum of personal time and space that the Prime
Prime Minister, Narendra Modi has suggested that the Minister has shared with the youth across various age
government would work to promote both apprenticeship and groups is unmatched, by any other premier, in the history
entrepreneurship. He said it is important for India to be able of independent India. The government’s reforms shall bear
to predict future possibilities, and to “prepare for them today fruit as further thrust towards areas such as job creation,
itself”. Job seekers, job providers, students and policy- education, research and new age entrepreneurship would
makers need to think alike, he added. stem India’s brain drain and instead, attract more young
talent globally.

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Boosting Services Sector

From Prominence to Dominance

MAAZ AHMED, HEMANT R, SHANKAR & PRUTHVI RAJ KULKARNI

An avid Twitterati and among the most followed Services sector contributes over half of India’s GDP, and it
leaders globally, Prime Minister Narendra has attracted a lot of foreign direct investment with India’s
Modi tweeted on 20th October, 2018, “Dear strength. The sector has built the economic structure by
professionals associated with the IT sector, contributing to exports and also for generating employment.
technocrats and tech-lovers, I have a request...Have a look
at this Open Forum on the ‘Narendra Modi Mobile App”. It Such is the exuberance of India’s services sector, that
was a clarion call to the highly skilled services professionals despite being a legacy driven agrarian economy, the sector
of the country to be a part and leverage their skills for a New sums up India’s edge over rest of the major economies
India. of the world. Hardly a wonder then, that it contributes the
majority chuck of the national GDP.
On 28th February, 2018, the Union Cabinet chaired by
Prime Minister Narendra Modi, approved the proposal of the India’s services sector covers a wide range of activities
Department of Commerce to provide focused attention to including trade, hotel and restaurants, transport, storage and
12 identified Champion Services Sectors for promoting their communication, financing, insurance, real estate, business
development, and realizing their potential. services, community, social and personal services, and
services associated with construction.

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In February, an action plan was approved for ‘12’ champion is INR 45,034. This amount is inadequate for launching a
services sectors for realizing their potential through the start-up employing others. But these cannot override the
establishment of INR 5,000 crores dedicated fund. The core function of facilitating jobs generation. There have been
12 champion sectors include IT, Tourism and Hospitality, issues in fetching real-time data.
Medical Value Travel, Transport and Logistics, Accounting
and Finance, Audio Visual, Legal, Communication, The ministry of Micro, small and medium Enterprises (MSME)
Construction, and Related Engineering, Environmental, has adopted the cluster development approach as strategy
Financial and Education. for enhancing productivity and competitiveness and capacity
building of Micro and Small Enterprises (MSEs) and their
The action plan for these sectors involve close monitoring of collectives in the country. A cluster is a group of enterprises
grassroots level issues like, ‘does the sector have the right located within an identifiable and as far as practicable,
regulatory framework for its smooth functioning? Do they contiguous area and producing same/similar products/
have the right service standards? Are there any infrastructure services.
gaps and how to address any bottlenecks should there be
one?’ of course, these require high octane monitoring and To ensure sustainability and growth of MSEs by addressing
watchdogs who could fetch real-time data for the ministries common issues, build capacity for common supportive
to act. action, create/upgrade infrastructure in the new/existing
industrial areas/ clusters of MSEs; and set up common
The action plan is currently in its final stages. Under the facility centers.
chairmanship of cabinet secretary, the plan is being revised.
With the action plan coming into picture, the government Given the diverse nature of MSEs in terms of geography
aims to grow the economy in real ways, as opposed to and sectoral composition, the MSE-CDP scheme aims to
statistical data. address the needs of the industries through well-defined
clusters and geographies. This will allow for achieving
The government is trying to restructure the economy with the economies of scale for deployment of resources and
bold moves like demonetization and the GST roll-out. The focusing on the specific needs of similar industries.
vision of the government is now clear.
Infrastructure has also been a concern for these enterprises
The government is by and large involved in job creation. to flourish smoothly and effectively. With technological
MUDRA Yojana is testament to this. Prime Minister Narendra advents and particularly the government being invested in
Modi had said the MUDRA Yojana transformed the lives of Digital India, several technological services are deployed for
the poor. “MUDRA Yojana has opened up new avenues for the existing enterprises. A total of 1,018 interventions across
youth, women and those who wanted to start or expand clusters in 29 States and one UT have so far been taken up.
their businesses” As per the data on MUDRA Yojana’s official
website, almost 130 million people got loans under the Assistance for interventions include (i) Preparation of a
scheme till May 25, 2018. Diagnostic Study Report with Government grant of maximum
INR 2.50 lakh for field organizations (MSME-DIs) of the
The sanctioned amount under Mudra Yojana was INR 6 lakh Ministry of MSME; (ii) Soft Interventions with GoI grant of
crore (INR 6,00,589.21 crore) out of which INR 5.81 lakh 75% of the sanctioned amount of the maximum project cost
crore (INR 5,81,283.18 crore) was disbursed. of INR 25 lakh per cluster with provisions for North East and
SC/STs; (iii) Detailed Project Report (DPR) with GoI grant of
There however were a few issues curtailing the reach of maximum INR 5 lakh for a technical feasibility and viability
Mudra Yojana. The average sanctioned loans under Mudra report; (iv) Hard Interventions in the form of tangible assets
Yojana comes at INR 46,530 while that of disbursed amount like Common Facility Centre with GoI grant upto 70% of

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the cost of project of maximum INR 15 crore.
For NE & Hill States, Clusters with over 50%
(a) micro/ village; (b) women-owned (c) SC/ST
units, the GoI grant will be 90%; (v) Infrastructure
Development with GoI grant upto 60% of the
cost of project of INR 10 crores, excluding cost
of land. GoI grant will be 80% for projects in NE
& Hill States, industrial areas/estates with over
50% (a) micro (b) women-owned (c) SC/ST units.

Some of the major developments and 137th position in 2014
investments in the services sector include ●● Five times more growth in major ports’ traffic during
prospects of leisure and business travel and 2014-18, compared to 2010-14
tourism spending rising to INR 14,12,710 crore ●● Six-fold increase in Government spending on
and INR 80,640 crores in 2018, respectively. telecommunications infrastructure and services in
Meanwhile, earnings from medical tourism could the country – from INR 9,900 crores during 2009-14
exceed USD 9 billion by 2020 and the Indian to INR 60,000 crores during 2014-19.
healthcare companies are furiously taking to ●● 11 projects worth INR 824.80 crore were sanctioned
M&As with domestic and foreign companies to drive growth under the Swadesh Darshan
and gain market. ●● Highest-ever revenue was generated by Indian IT
firms at USD 167 billion in 2017-18
The Centre recognizes the importance of promoting growth
in the services sectors and provides several incentives in The government has been asserting the importance of
sectors like healthcare, tourism, education, engineering, economic growth for continuous growth. Over four years, the
communications, transportation, IT, banking, finance, Prime Minister and his team have made efforts to cement a
management, among others. The PM has stated that India’s cohesive bond with different nations to facilitate economic
priority will be to work towards trade facilitation agreement boom.
(TFA) for services which is expected to help in the smooth
movement of professionals.

Services sector’s growth is governed by domestic and global
factors. The Indian facilities management market is expected
to grow at 17 percent CAGR between 2015 and 2020 and
surpass the USD 19 billion mark.

The implementation of the Goods and Services Tax (GST) These strategic reforms to boost the services sector is
has created a common market and reduced the overall tax creating an enabling ecosystem for the industry to evolve
burden on goods. It is expected to reduce costs in the long from being just a provider of skilled workforce to the global
run on account of the availability of GST input credit which IT industry to becoming a hub of product development,
will result in a cut in cost of services. The government’s product design and cutting edge innovation. Just pair that
constant efforts towards ensuring the robustness of the with the government’s efforts to make India the world’s
services sector has led to: manufacturing hub and what results is a 360-degree, end-to-
end indigenous capability to power India among the league
●● A steep rise in India’s rank to 24th position, in the of the advanced economies.
World Bank’s Ease of Doing Business in 2018 from

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Reversing Brain Drain
and Harnessing

Yuva Shakti for India

Dr. Mafruza Sultana skilled and qualified people to a country where they can
Lecturer-Economics & Statistics, work in better’. Much of the reasons attributed for the brain
drain are related to a lack of adequate job opportunities,
IFIM Business School poor research infrastructure and low funding for research,
among others.
“Quality education should be prioritized along with
literacy campaigns. We have been focusing on Reports suggest that an estimated 17 million Indians were
the outlay, now it is time for us to concentrate living abroad in 2017. This has made the country the
on the outcome of our education system”, said largest source of international migrants; a 140+ per cent
Prime Minister Narendra Modi, in his 19th Mann Ki Baat increase year-to-date, since 1990 (Source: United Nations
address on April 24, 2016. Department of Economic Affairs). However, the trends are
changing as the government focuses more on the aspect
Hitting the central nerve of India’s long-term development of creation of an enabling ecosystem for highly-skilled
agenda, the Prime Minister highlighted the urgent need to professionals and scholars.
create institutions that do not just impart knowledge but
also enhance India’s intellectual capital through research, A few days before India’s 72nd Independence Day, Union
development and industry-academia collaboration. Minister Harsh Vardhan said, “Before Prime Minister
Narendra Modi, people used to talk a lot about ‘brain drain’.
Traditionally, India has, for decades, suffered the brunt of People talk about ‘brain drain’ to some extent even now, but
brain drain, a phenomenon of ‘the movement of highly they talk more about ‘brain gain’ now.” Higher education in
India has witnessed revolutionary changes under the present
government.

The East India Company took the initiatives for setting up
higher learning institutions in India in late 18th century and
India’s higher education system is the third largest, next
only to the United States and China. The University Grants
Commission (UGC) is the highest regulatory body for fixing
standards, advising government, and helping to coordinate
between the Centre and the state.

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The Indian higher education is undergoing rigorous reforms.
Under the Modi government, since 2014, some of the focus
areas have been transparency, strengthening of vocational
and doctoral education, and professionalization of the
sector through stronger institutional responsibility to help
reprioritize efforts and work around the complexities.
The rise of IT sector, engineering and management
education has limited students’ path to explore and discover
their passion.

Accreditation for higher learning is overseen by autonomous Figure 1.a
institutions established by the UGC. As of 2016, India has
799 universities, with 44 central universities, 540 state
universities, 122 deemed universities, 90 private universities
and 5 institutions established and functioning under the
State Act. Other institutions include 39,071 colleges as
Government Degree Colleges and Private Degree Colleges,
including 1,800 exclusive women’s colleges, functioning
under these universities and institutions. There are
institutions of national importance, including IITs, IIMs, IIESTs,
AIIMs, NITs that function autonomously established by the
Government directly.

Central and state governments have been making efforts Figure 1.b
to cultivate talent, mostly by increasing the number of
Universities and Colleges for higher education. Table 2 depicts the percentage of GDP spent on higher
education. It means, Central Government increased its
Table 1 spend on higher education. From Table 1 and 2, it is
Growth of Higher Education apparent that with increased expenditure, a number of
universities tripled and the number of colleges doubled.
institutions in India

Table 2
Expenditure on Higher Education

Source: University Grants Commission, New Delhi (2012) & MHRD Source: University Grants Commission, New Delhi (2012)

From the above Table 4 and Fig 4 we can state the
enrolment in various programmes has grown considerably

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Table 3
Expansion of Universities and Colleges from 2011-12 to 2015-16

Source: AISHE 2015-16

Table 3

From the above Table 3 and Figure 3 it is clear under the present government there has been a
continuous growth of universities and colleges.
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Table 4
Year wise (2011-12 to 2015-16) student enrollment

Source: AISHE 2015-16

Figure 4 in the last 5 years (from 2011-12 to 2015-16),
which has increased from 2,91,84,331 in 2011-
12 to 3,45,84,781 in 2015-16. The overall
growth is 18.5%. It is clear that the enrolment
at all levels has increased.

The higher education system faces new
challenges like gender disparities in enrolment,
incomes and low-quality faculty and poor
motivation, and interest among students. Skill
shortages is a major factor for unemployment
among graduates. The challenges include:

l The rapid growth of private higher education
institutions due to non-availability of state funds
to expand higher education. In addition, small
and rural educational institutions have poor
funding. A number of institutions run self-

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According to a report commissioned by EY-FICCI titled, ‘State-focused Roadmap to India’s Vision 2030’, the government,
along with relevant stakeholders should build a world-class system of higher education that meets the national priorities and
fulfils aspirations of its people.

:Source: FICCI higher education summit 2015

financing courses. ●● Strengthening intellectual capital and infrastructure of
state universities and colleges through more funding to
l India has an enrolment rate of 15%, much lower than the develop infrastructure.
developed and developing countries. Enrolment in higher ●● Autonomy of private sector Institutions through self-
education is very low in rural areas. Post-Independence, financing courses.
although the gender gap has reduced in enrolments, there is
disparity between departments. Some of the initiatives for empowering education
institutions
l Inadequate infrastructure is another challenge faced
by higher education of India. Basically, the government- ●● UGC has granted graded autonomy to the top 60
funded institutions suffer from poor infrastructure, excluding universities.
institutions of national importance. ●● National Testing Agency to conduct all professional
exams as per international standards.
Future challenges that need immediate attention ●● Numerous scholarships provided to students to
●● Quality of education should be linked to employability complete their studies.
by encouraging professional courses with innovative and ●● Vigorous attention devoted to teacher training to
practice-oriented curricula. p roduce top quality teachers.
●● Curricula need to be innovation-oriented that lead to ●● 20 institutes will be declared as “Institute of
entrepreneurship. Eminence”.
●● Attract International students through international ●● Numerous universities, 7 IITs, 7 IIMs, 14 IIITs, 1 NIT,
student exchange programs. 1 03 KVs and 62 Navodaya Vidyalayas established
a nd have started functioning by modi government

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●● Major reform in education ensured by granting granting powers and in dire cases, even a direction to cease
autonomy to quality institutes by passing IIM Bill. all operations.
●● Recognizing talent with PM Research Fellowship
Scholarship worth INR 70,000 per month for 5 years In spite of the numerous challenges faced by higher
and INR 2 lakh annual grant for PhD and research. education with its relatively-low Gross Enrollment Ratio
●● To build innovative skills 2,400 Atal Tinkering Labs (GER), the current government is trying to focus on holistic
sanctioned in schools at INR 20 lakh each. development through Khelo India, Pradhan Mantri Kaushal
●● Government of India also built 54,000 ramps Vikas Yojana and Yuva Shakti through Self-Employment.
& railings and 50,000 special toilets for physically
challenged. Social reforms may be difficult to execute owing to the
numerous complexities, social and legislative, but the overall
The government is working on a Bill for a single higher quality of education has started to grow. Due to increased
education regulator. The regulator is expected to replace expenditure the numbers of universities and colleges have
existing regulatory authorities like UGC, AICTE and National also increased. All universities and institutions if given the
Council for Technical Education (NCTE).It will not have grant- autonomy to start self-financing courses particularly in areas
giving powers. where job opportunities exist, shall lead to a tremendous
increase in the employability of our youth. This in turn shall
HEERA, unlike UGC, will “train/mentor institutions not stoke a broad-based economic revolution that shall lead to
maintaining the required academic standards”. Central or long-term, sustainable growth for the country.
state government grants to an institution will require that they
meet the standards outlined by HEERA. Funding powers will The government has been proactively implementing
be largely vested with the HRD ministry which will release structural reforms and strategic initiatives that are beginning
grants based on action plans of institutions. to yield results. The real on-ground effect however, shall
be more visible by 2022, as the trickle down impact of the
HEERA may provide expert advice to institutions for reforms amplify.
‘promoting ​excellence’. If a university is found granting
affiliation to a course in contravention of regulations of the
HEERA, it may face a penalty, and withdrawal of degree

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Leveraging Conscious
Capital In

Education Sector

It would be worthwhile to note that, the very aspect of
market efficiencies, catalysed by higher literacy levels and
disruptive trends are critical to building a transparent and
competitive systems. After all, knowledge is power and
democracy by its virtue, empowers all its citizens.

Sanjay Padode As the youngest nation in the world, education, its allied
infrastructure and education policies form the triad of holistic
Secretary socioeconomic development. A majority of the 250 million
Centre for Developmental Education youths of India resides in its villages and the per capita
income currently stands at a little above $2,000. Considering
these two metrics, what should be the characteristics of the
education sector to propel India to its real potential?

From the Licence Raj era that continued until the late The education sector is expected to cross $100 billion by
80s to the exuberance post liberalisation, India has the end of FY2019. There are over 39,000 colleges and 900
matured into a high growth, high potential economy. universities across the country. The numbers are only expect
As an essentially socialist economy, post-Independent to swell.
India has undergone some painful moments, registering a
Hindu rate of growth, followed by an extended phase of While in absolute terms, India’s spend on the education
cronyism. To be fair, while the GDP growth has accelerated sector has increased, as a percentage of GDP it still falls
year-on-year, there still remain some quarters, reminiscent of woefully short in terms of resources to fuel this juggernaut.
cronyism. The primary reason, is the approach methodology which
prevents this sector from attracting private money and
reducing the pressure on the government.

It is true that as a stable, thriving democracy in the heart The government has indeed been on its toes, to move in
of Asia, our financial system has embraced the concept of tandem with the needs and changing trends. The Prime
market efficiencies seamlessly, despite numerous challenges; Minister’s Skill India initiative to train 400 million youths by
this has led to sophisticated and well-regulated capital 2022, the Pradhan Mantri Kaushal Vikas Yojana, the National
markets. Policy for Skill Development, the Unnat Bharat Abhiyan

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and the MHRD’s Ek Bharat Shreshtha Bharat campaign are Lets take a look at the maths. Promoters of institutions are
breath-taking, big bang reforms that are transformational. expected to own infrastructure during the floating of their
But these fundamental structures have not yet been adopted education venture. The edupreneur creates these more often
smartly, by the private sector. than not, by borrowing funds against either hereditary or
purchased land holdings. This imposes a cost of interest,
Today, over 70% of higher education in the country is which is then passed on to the students in the form of
delivered by the private sector. While not doubting the creative fee components. The tuition fee is then loaded to
altruistic motive of these institutions, it is unfortunate that provide for the 10-13% interest cost.
some of the decisions are not earmarked to the criteria of
maximum academic and social impact. Even profit, the key motive for any entrepreneur, comes at
a cost, as there are levies attached to it. The levy towards
There are asymmetries that exist in the regulatory framework these profits are discretely inducted in the form of services
that compel the private players to focus substantially on fee for the various resources availed by students within the
the commercial viability aspect. Regulatory control and institution’s purview. These amount to anywhere between
cap on the fee structure leaves institutions with less room 10-15% rise in costs of tuition fee.
to maneouvre. It puts an immense amount of pressure to
operate in a constrained financial environment. Then comes the cost of marketing— from the student
acquisition to the campus placement, the total costs incurred

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are in the range of 25-30%. These too are factored in as Such a corporation should be permitted to distribute profits
cost-to-student in the form of fees. not exceeding 20% of the net surplus generated and should
be provided with a tax exemption on its surpluses as long as
The result of these— bloated student loans. While in the US, the corporation is recognised by the education regulators.
student indebtedness has already garnered national interest,
in India, its still insulated, but unfairly so. Most students in This could become a self-regulatory mechanism for funding
India end up funding higher education through bank loans education in the future and also could be opened for funding
by mortgaging family assets. It is interesting to note that the by foreign investors to attract overseas investment. The
student pays the interest on such bank loans and indirectly already established regulatory mechanics of the capital
for the financial costs for the institution funding. This is market will reduce the trust deficit associated with funding
indeed a double whammy. education and provide a more attractive proposition for the
monies that are being spent overseas for the same purposes
Most students end up funding higher education through by high net worth Indians.
bank loans by mortgaging family assets. Test preparation,
entrance examination fees, coaching etc. are the other Such an asset class would help reduce the dependency of
added costs that add to the total cost of education. It is time finance of private education on debt and the reduced burden
to develop an ecosystem to deliver upon the true intent of of interest would surely make more monies available with
‘not for profit’ education. the institution for investing into the quality of education. It
would also enable the genuine private educators to access
The top-notch institutions globally, are funded through the capital markets and raise finance based on the credibility
endowments, grants, donations or state funding. They established by their institutions in the education world.
receive significant funding for developing patents, offering
consultancy and research activities. The price discovery mechanism by virtue of free hand of
the markets, would develop market capitalisation for quality
It is high time that the sector needs to develop a formal and institutions enabling them to raise larger resources with
regulated mechanics of funding. There are enough and more lesser dilution.
HNIs and institutions who may have the philanthropic desire
to participate in the education sector through grants and It is commendable that the Government has formed the
endowment, even for a lower return. Higher Education Funding Agency (HEFA) with the aim to
seek funds to improve and provide more robustness to the
The best formal mechanism for making this happen is institutions and the curriculum. Despite the noble intentions,
through the already mature capital markets of our country— the initiative has not garnered sufficient interest among
leveraging conscious capitalism to empower India through investors.
education.
Then what’s stopping the private sector and entrepreneurs to
A new asset class could encourage the investors in capital sprint ahead and take a leap? For starters this model could
markets to fund educational institution and reap reasonable be called, the ‘Bharat EduShare’.
returns which are tax free. This would allow the investors to
tap into the latent value of educating high potential academic
talent, while at the same time reaping the obvious monetary
and social benefits.

The investment vehicle in a social corporation which is public
limited is created for the purposes of delivering education.

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