Enhancing Investments
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Foreign Investment Promotion
- Actual foreign investment in India is only about 50% of FDI approvals.
- Government has set a target of $10bn. But this figure is difficult to achieve, given the procedural bottlenecks at the local level
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- Foreign Direct Investment will continue to be encouraged.
- My government will enact an omnibus Foreign Investment Promotion Act, which will set benchmarks for all government agencies, at the central, state and local levels to reduce the hurdles for foreign and domestic investors.
- The Act will promote a “Single Face of the Government”
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Administrative Reforms
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Performance-based System
Productivity level in government departments is quite low courtesy Article 311, which provides job security to government servants
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- The government will introduce a performance-based management system for all its functionaries and departments to make them more performance-oriented and accountable.
- Incentives will be given to good performers
- The government will strive to become a SMART Government (Simple, Moral, Accountable, Responsive & Transparent)
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- Set up a fund of Rs.100 crores for rewarding good performers
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Administrative Reforms
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Accountability
- The government loses Rs.41,000 crores due to delays in more than 300 projects, which are all above Rs 20 crore each. Imagine the total cost of delays if all central and state government projects are examined
- For instance, the Ganga Action Plan was started in February 1985 and scheduled to be completed by March 1990. Later, it was declared that the work would be completed by 2001. However, it has now been further extended to December 2008. This clearly indicates the extremely slow pace of development work being done for the past 18 years.
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- The government is committed to complete all existing irrigation projects within three-four years.
- The Central and State governments must ensure transparency in implementation of projects.
- Proper Project Management System will be put in place to ensure timely implementation of projects.
- Rewards will be given to staff and contractors for completing work on time. Delay in completing projects will attract penalties. These provisions will be put in the contract document itself.
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Administrative Reforms
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Corruption
- As per estimates of Transparency International (India), Rs 26,728 crores is wasted every year due to corruption, and it is the poor who suffer the most.
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- My government is determined to rid the country or at least reduce the scourge of corruption. For this purpose, procedures will be streamlined and systems automated as far as possible to eliminate any discretionary power.
- Outsourcing of several government functions will be considered.
- Incentives will be given to the states’ anti-corruption squad.
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- A budget of Rs.500 crores for CVC and for giving incentives to states’ anti-corruption measures
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Leakages
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Non-merit Subsidies
- Subsidies on non-merit goods and services amounted to Rs 20,600 crores (2001-02)
- Poor delivery with the undeserving getting a share
- The richest 20 percent capture about 31 percent of subsidies meant for the poor, while 20 percent of the poorest use only 10 percent of the services (Source: World Bank Report)
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- I am committed to eliminate revenue deficit of the central government by 2009 to release more resources for investment in social and physical infrastructure.
- All subsidies will be targeted at the poor and the truly needy.
- My government will empower Civil Society Organisations (CSOs) to act as watchdogs. CSOs play a crucial role in promoting participatory approaches at the grassroot level by involving people in the decision making process.
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- Rs.500 crores fund for empowering CSOs
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Leakages
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Transmission & Distribution Losses
- T&D losses in power sector estimated at 1.5% of GDP
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- Incentives will be given to state electricity companies/boards for reducing T&D losses.
- Professional management will be put in place and full managerial and commercial autonomy will be given to power distribution companies.
- The government will forge strong partnership with consumer organisations to check T&D losses in power sector. Measures will be taken to empower these organisations to make their participation effective.
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- Rs.1000 crores as incentives for state electricity companies/boards
- Rs.100 crores for empowering consumer organisations
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Unsafe Food
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Adulteration
- Rs.4000 crore loss to industry and Rs.2000 crore loss to the exchequer annually
- Loss to consumer far exceeds the sum total
- The PF Act empowers consumer organisations to prosecute offenders but lack of resources and skills prevent effective implementation of this power.
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- The government will empower state and local governments and establish a fund to enable them to check the menace of adulteration.
- Consumer organisations will be resourced to act as good watchdogs.
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- Rs.2000 crore to establish a Food Safety Fund
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