New Delhi, 30 June 2007 

Industrial Spectrum Of India

SMALL SCALE SECTOR VITAL FOR INDIA’S GROWTH

By T.D. Jagadesan

Small Scale Industries (SSI) sector has emerged as a vibrant and dynamic area of the Indian economy. Not only in terms of employment generation the entrepreneurial base it helps to create but also because nearly 40 per cent of the total industrial production and over 34 per cent of the national exports falls in this sector. Moreover, it constitutes an important means to tackle the problem of unemployment and can be used as an important tool to prevent concentration of economic power in the hands of a few individuals. By assisting the development of semi-urban and rural areas through the utilization of local skills, raw materials and resources.

The SSIs are industrial undertaking in which the investment in fixed assets (plant and machinery) whether on ownership basis, terms lease or hire purchase does not exceed Rs.one  crore. Over the past five decades, the Governments policies have been to protect the interests of the SSIs sector and facilitate its rapid development. The Government in pursuance of these policies has initiated various support measures from time to time which include the policy of reservation, revision of investment ceilings, modernization, technological upgradation, marketing assistance and fiscal incentives etc.

The small scale sector which owes its definition to the industries (Development and Regulation) Act, 1951, comprises a divergent spectrum of industries, ranging from micro and rural enterprises, using rudimentary technology to modern small scale industries employing sophisticated technology.  At present, the sector accounts for over 95 per cent of the industrial units in the country, 34.29 per cent of the national exports, 6.86 per cent of the GDP, generates employment to 193 lakhs people and produces 7,500 items. Also, 749 items are reserved for exclusive manufacture and about 358 items are earmarked for exclusive purchase from the SSIs. The constant support by the Government in terms of infrastructure, fiscal and monetary policies have helped this sector emerge as a dynamic sector.

In recognition of this role, the SSI sector has been assigned targets of 12 per cent annual growth in production and creation of 4.4 million additional employment opportunities in the Tenth Five Year plan even as the investment limit for it continues to be Rs.one crore. However, the Ministry of Small Scale Industries has brought out a specific list of hi-tech and export-oriented industries whose investment limit has been raised to Rs.5 crore to facilitate suitable technology upgradation and enable them to maintain a competitive edge in the global economy. The exemption from excise duty continues to be Rs.one crore.

Additionally, the Integrated Infrastructural Development (IID) scheme has been extended to cover the entire country with 50 per cent reservation for rural areas. The Small Industries Development Organization (SIDO), set up in 1954, functions as an apex body for sustained and organized growth of the SSIs. Sadly, due to competition with large scale producers, multi-nationals and paucity of financial resources, the SSIs do not get raw material of good quality and in some cases they do not get enough supplies even of the inferior quality of raw materials.

Also, the SSIs have to pay comparatively higher prices for raw materials, resulting in an increase in the cost of production, decrease in profit and their ability to complete with large scale industries. Worse, the old and obsolete methods of production, leads to technical inefficiency which in turn increases the cost of production and renders them unfit to compete with large industries and the MNC. Moreover, the marketing methods of the products are defective. There are no communication channels between the small scale producers and the ultimate consumers. In many cases, the producers do not know the domestic and international markets where their products are consumed and who purchases them. Lack of adequate statistical data is also posing a serious problem in the development and growth of the SSIs. Without reliable statistics regarding production cost, labour, wages prices and extent of market, it is quite impossible to assess their economic potentialities.

A majority of the SSIs need financial resources for modernization and expansion. However, due to low wages and poor working conditions of these units, skilled and trained human resources are not attracted towards them. They also do not have funds to invest on advertising their products. The access to adequate credit, technological obsolescence, infrastructural bottlenecks, marketing constraints and a plethora of rules and regulations are major problems infecting the SSIs.

In order to provide a favourable business environment for the growth and development of the SSI sector, the Government took many initiatives to give an impetus to the growth of the sector in 2004-05. These include the National Commission on Enterprises in the Unorganized Informal Sector set up in September 2004. Recommended measures for improvement in the productivity of these enterprises, generation of large scale employment opportunities, linkage to an institutional framework in areas like credit, raw material supply, infrastructure, technology upgradation, marketing facilities and skill development.

To facilitate technology upgradation and enhancing competitiveness, the investment limit (in plant machinery) was raised in October, 2004 from Rs. one crore to Rs.5 crore in respect of 7 items of sports goods, reserved for manufacture in the small scale sector.  The Small and Medium Enterprises (SME) fund of Rs.10,000 crore was operationalized by the SIDBI in April 2004. Wherein 80 per cent of it lending was at an interest rate of 2 per cent. The Reserve Bank on its part, enhanced the composite loan limit to Rs. 1 crore from Rs.50 lakh.

More, with a view to integrate small and medium enterprises facilitate growth and enhance competitiveness (including freeing the SSIs from “inspector raj”) a suitable legislation is being finalized. A new “promotional package for small enterprises” is being formulated. This would include measures to provide adequate credit, incentives for technology upgradation, infrastructural and marketing facilities etc.

In sum, the small scale sector occupies an important position in the industrial spectrum of the country. The Government needs to play a pivotal role and take strong action in solving the problems faced by this sector.  As it is the best sector for rural and semi-urban development, the Government must pay particular attention to its development so that it grows in a challenging environment of India.---INFA

 (Copyright, India News and Feature Alliance)

People And Their Problems

New Delhi, 23 June 2007

Human Trafficking

Poverty & Deprivation Main problems

By Dhurjati Mukherjee

Human trafficking has been a big problem in many parts of the world and specially in India and many other Asian countries. The UN Protocol Against Trafficking in Persons, in effect since December 2003 makes human trafficking a crime. The Protocol has been signed and ratified by more than 110 countries, yet the participating governments and their criminal justice systems have not effectively curbed the practice. Few criminals are convicted and most victims are not properly rehabilitated.

Trafficking in persons has mainly been for sexual exploitation or forced labour and, according to reports of the UN Office on Drugs and Crime (UNDOC), 127 countries get exploited among 137 nations. Some 2.5 million people throughout the world are at any given time recruited, entrapped, transported and exploited---a process called human trafficking. The UN and other experts estimate the total market value of illicit human trafficking at $ 32 billion; about $ 10 billion is derived from the sale of individuals and the remainder representing the estimate profits from the activities or goods produced by the victims of this barbaric crime.

Apart from slavery is booming international trade and involves both the sexes. The most important aspect of human trafficking is of women and girls, 80 per cent of whom, as per UNDOC data, are forced into prostitution. The other reasons for women and children being trafficked are: labour in garment, carpet and other industries/factories/work sites; work in the entertainment industry, including bars, massage parlours etc; forced labour in construction sites; sex tourism; drug trafficking; organ trade; and domestic work.

Poverty, lack of opportunities and the desire for better existence have been the principal reasons for the increase in human trafficking and sexual exploitation in Third World countries. It is distressing to note that the trafficked victim is subject to the worst form of human rights abuses---physical violence, sexual abuse, confinement, denial of basic needs of health and nutrition, deprivation of earnings etc.

In India, the problem of trafficking has suddenly received much attention with even politicians being engaged in this work. However, trafficking has been a long-standing problem in this region, specially in countries like Nepal, Bangladesh Thailand and India. The spread of consumerism and western life styles in society along widening inequality among the urban and the rural sectors have accentuated the problem at least in the Asian countries.    

The problems in populous countries like India are well known which have a stagnant rural sector with all-round poverty and squalor very much manifest. Moreover the discrimination of the girl child has been another aspect of the problem. Apart from the desire to make the girl child work by the parents, the passion of girls (generally aged between 15 to 25 years) to live a better existence induces them to be trafficked. They generally enter the flesh trade or are used in hotels for entertaining clients, whether in India or abroad.

It is not that girls only from the poorer sections of society that become prone to abuse and sexual exploitation. It has been found that girls and women from the middle or even upper class in their quest to earn more become prone to human trafficking. In today’s world, prostitution has attained a new dimension whereby sharing a bed is not taboo. Thus well-off girls starting with such practise eventually become prone to trafficking.     

Meanwhile the Centre has come out with startling revelations on child abuse, mainly of girls, according to a national survey. More than 53 per cent of children have been found to be subjected to sexual abuse in ways that ranged from rape to kissing. Apart from this, 69 per cent of children faced physical abuse, in most cases (89 per cent) from parents or members of the family. These and many other things were revealed by the 13-state survey report Study on Child Abuse: India 2007 conducted by the Ministry of Women & Child Development in association with UNICEF, Save the Children and Prayas and released recently. This was incidentally the first-ever nation-wide survey on child abuse with a sample size of 12,447 children, including 5981 girls.

Delhi, by Andhra Pradesh, Bihar and Assam have been found to be the front-runners in child abuse cases. These states showed higher physical, sexual and emotional abuse of children. In 50 per cent of cases, the abusers were known to the child or were in a position of trust and responsibility and most children did not report the matter. Thus it can very well be assumed from the survey that the children were not safe even in their homes and remain victims of different forms of abuse.

The study also found that children in the 5 to 12 age group reported higher levels of abuse and boys were as much at risk as girls. The high abuse has been attributed to fathers looking at children as their property, the patriarchal set-up of society and poor parenting skills although no empirical research was conducted to gauge the exact reasons. But whether it is physical or sexual abuse, most children don’t report the assaults to anyone.

Another aspect of the problem of women is abuse and sexual violence. According to the National Family Health Survey –III, 37 per cent married women reported abuse though one can be very sure that another significant section do not report. The top offenders include Bihar 50 per cent, followed by Rajasthan 46.3 per cent, Madhya Pradesh 45.6 per cent, Manipur 43.0 per cent and UP 42.4 per cent. 

The question arises: how could girls be provided security? This can come about if there is thrust on education along with not just mid-day meal but a maintenance allowance every month, specially for those belonging to the economically weaker sections, to help them continue with their studies. The thrust on girls education has to be taken up with all sincerity and should reach all backward areas of the country.

The other aspect of tackling the problem is the spread of awareness among women and girls about their rights. Though this has been taken up by NGOs and CBOs, there is need for giving a boost to this campaign, including generating basic legal awareness among the opposite sex. It is indeed distressing to note that in spite of setting up national and stare level women’s commissions the problem of trafficking and sexual exploitation has remained unchecked.

More resources need to be allotted for the development of the female child and ensuring a dignified existence for her. Recent reports indicate how a million girls would be eliminated every year in the coming four years because efforts have been grossly inadequate in restraining the promotion of foetal sexing. Preference for a son has caused hatred for a daughter in India in recent years due to the widespread ‘legitimization’ of this form of violence against women.

The 11^th Plan, which talks about inclusion needs to give a fair deal to women, should take up various injustices committed against girls and women and deal with them through an iron hand and also simultaneously ensure their education and awareness in a target-oriented approach. The NGOs and CBOs should be provided with adequate funds so that they could make inroads into the rural and backward areas and tackle trafficking and sexual violence against the opposite sex while also pursuing that girls enter school in a big way.

The intervention strategies should focus on the following areas: prevention through raising public awareness, setting up neighbourhood watch committees for monitoring incidents of missing girls, ki dnapping/abduction and migration, networking for information sharing and quick response to crisis situations and providing opportunity for holistic development to children of women in prostitution so that they are not forced to follow their mothers; securing the rights of women and children; rescue and after-care; documentation and study; and promotion of a secure and protected environment for women and children.---INFA

 (Copyright, India News and Feature Alliance)

People And Their Problems

New Delhi, 16 June 2007

Effective Employment Policy

STRESSING STATE’S RESPONSIBILITY

By T.D. Jagadesan

The Centre evidently keen on imparting a fillip to employment opportunities to the eligible people. Hence it has wisely launched recently the National Rural Employment Guarantee Scheme (NREG) in 200 districts covering 23 States. The NREG was notified in February last year thus underlining the importance as well as expediency of securing the livelihood of the people in rural areas by generating 100 days of employment in a financial year to rural household.

There is justifiable jubilation over the eight per cent plus growth that the economy has been recording for over three years and at the same time there is concern that there are significant sections of the population that are yet to benefit from the growth process. The Eleventh Plan document attempts to address this issue squarely.

There is concern that the rate of growth of employment is reported to have slackened, in many segments of the rural economy, during the decade of reforms. The report of the Planning Commission’s Task Force on Employment Opportunities shows an absolute decline in the number employed in agriculture, between 1993-94, and 1999-2000, at the all-India level. Information from 60^th NSS round, 2004-05, the Economic Census 2005 and the Annual Survey of Industry indicate the following:

Employment growth accelerated to 2.6 per cent during 1999-2005 outpacing population growth, but the average daily status unemployment rate, which had increased from 6.1 per cent in 1993-94 to 7.3 per cent in 1999-2000, increased further to 8.3 per cent in 2004-05.  This was possibly due to the fact that the working age population grew faster than total population and labour force participation rates increased, particularly among women. The extent of under employment also appears to be on the increase.

Agricultural employments has increased at less than 1 per cent per annum, slower than population and much slower than non-agricultural employment. Also, although real wages of these workers continue to rise, growth has decelerated strongly, almost certainly reflecting the poor performance in agriculture.  There are also transition problems in changing employment patterns, and these are probably being exacerbated by our landholding structures and by barriers of caste and gender.

Non-agricultural employment expanded robustly at an annual rate of 4.7 per cent during 1999-2005 but this growth was entirely in the unorganized sector and mainly in low productivity employment.  Employment in the organized sectors actually declined despite fairly healthy GDP growth.

On the supply side, the document indicates that the during 11^th Plan if it grows at the same rate as current projections around 65 million, if female participation rates rise at the pace observed during 1999-2005. Additional employment opportunities in the future would be generated mainly in the services and manufacturing sectors and policy initiatives are needed to support this.

The intention in the Eleventh Plan is to boost, in particular, labour intensive manufacturing sectors such as food processing, leather products, footwear and textiles, and service sectors such as tourism and construction.  Construction sector would generate substantial additional employment.

On the touring front both domestic as well as international, there are large possibilities for employment generation in the hotel, catering, entertainment and travel sectors as well as a market for handlooms and handicrafts.

Sadly, the solutions attempted in the Eleventh Plan document do not address these problems. There are anecdotal reports about severe shortages in skilled labour markets---in IT, tourism, and in skilled blue collar workers for manufacturing as well as for the construction industry. There are tales that textile export manufacturers are scouring the villages near Tirupur in Tamil Nadu for skilled tailors and embroider; that masons command the sky to wages and that ordinary skills are unavailable. Surely it is important to address the problem fro this end.

The Manufacturing Competitiveness Commission has estimated the need for skilled labour in over two dozen different professions, each of which exceeds a quarter million in the next five years. The training levels required to produce these employable are not available. Major IT firms complain that they are able to recruit from only ten per cent of the engineering colleges.

The manufacturing industry reports that the skill sets produced in the ITI are obsolete for the current markets. There is little attempt to infuse technology into agriculture, and even the downstream part of agriculture, storage, marketing and retailing, ahs been left to the private sector. 

The Eleventh Plan document fails to address these issues, and in fact relies heavily on the service sector and the unorganized sector including the construction sector to pick up the slack. Wishful thinking, without any evidence of how this will happen. Ab initio, the target growth of Agriculture of 4 per cent and of the entire economy of double that would leave those in agriculture poorer off at the end of the Plan. If poverty is added to unemployment, then it is likely to be a volatile combination.

In considering options for rural areas, it is important to recognize that short term focused policy of persistently protecting employment in sunset industries and in weaker economic units can go against greater employment with higher labour-productivity in the longer term. Competition restricting policies, including controls to the movement of goods and commodities must end, as they impose arbitrary restrictions on expansion liberalization is the key to making industry competitive.

The responsibility of the state is to ensure that the necessary skill sets are developed. This is easier said than done, since the task is to match market needs with the supply of skills, to reorient curriculum to retain teachers, add capital equipments for training, develop new syllabai, and in short, to revamp the entire supply chain of production of skills.

This is needed to be done in hundred of skills, ranging from it is to nursing, from tourism to hospitality, from ward boys to radiographers.  There is very little evidence in the Plan document of the mammoth task involved, nor of the resources and inter-ministerial efforts that would be needed to make this happen.  If these skill sets are not developed, it is quite conceivable that manufacturing competitiveness may be lost, that instead of making steel in India, corporates attempt to invest capital outside the country, and in fact seek competitive skills elsewhere, at the cost of local employment. ---INFA

(Copyright, India News and Feature Alliance)

People And Their Problems

New Delhi, 9 June 2007

The Forest Tribals

WHO CARES FOR VAN GUJJARS?

By Radhakrishna Rao

The violent protest by the Gujjar community in Rajasthan and adjoining States seeking Scheduled Tribes status  has  once again focussed attention on the sectarian and communal divide that our politicians cutting across the party lines and ideological barriers have been fostering with a view to create “caste vote banks”. In fact, with the agitation by socially and  politically influential  Gujjars hogging the limelight, neither the ruling elite nor the media has spared  a thought for the fate for hapless, socially deprived and economically marginalized Van Gujjar community inhabiting the  rapidly degrading forest stretches in the Himalayan foothills.

The forest dwelling, peace loving Van Gujjar community whose members are believed to be converts to Islam from many of the Rajput clans of north-west India, are politically powerless and socially disadvantaged, no one seems to care for them. In fact, in recent years, with the forest authorities in Uttar Pradesh and Uttarakhand putting hurdles in their migratory routes, the life for the community has become miserable and difficult. In fact, they are being coerced by the forest bureaucracy to evict their forest homes and move to the resettlement colonies .But for Van Gujjars life outside the forest could be a difficult preposition since they know only forest based animal husbandry with hardy, mountain buffaloes remaining the bedrock of their socio-economic life.

In view of their backwardness and unique lifestyle, for many years Van Gujjars have been seeking ST status for themselves. In fact, way back in 1994, the Uttar Pradesh Government had recommended conferring ST status on the community. Long before this, Avadesh Kaushal, Chairperson of the Dehra Dun-based voluntary organization Rural Litigation and Entitlement Kendra (RLEK), which runs a series of welfare schemes for the benefit of the community, had made a forceful plea to include Van Gujjars under the ST category.

However, the power that-be was not just interested in the community that hardly exercises its franchise. The argument of Kaushal was that Van Gujjars living in Uttarnachal and Uttar Pradesh should be given the ST status since the community has been accorded such status in Jammu and Kashmir, as well as Himachal Pradesh. “This community possess all the essential attributes of the STs like primitive traits, distinct cultural identity, geographical isolation, social backwardness and nomadic lifestyle”, observes Kaushal.

Kaushal also laments the fact that because of their residence in the depths of the forests and their migratory lifestyle, the community has been deprived of the benefits of the Government sponsored welfare schemes and developmental programmes. He is of the view that the community would be able to move with the time if the ST status is accorded to them immediately. Kaushal has also expressed his concern over the move of the Uttaranchal Government to evict this forest dwelling, vegetarian community and settle them in rehabilitation colonies with a view to put an end to their migratory lifestyle. But Van Gujjars are clear in their perception a settled mode of life in permanent colonies would mean a certain cultural death of the community.

Indeed, the uncertainty facing the nomadic pastoral Van Gujjars, is a veritable microcosm of the problems haunting the indigenous forest dwelling communities spread across the country. The Rajaji National Park (RNP), covering an area of 825 sq.km across Uttar Pradesh and Uttarakhand is one of the most important winter homes of the Van Gujjar tribe who consider the forest eco system to be their veritable lifeline.

In summers, they move to the upper reaches of the Himalayas along with their herds of mountain buffaloes in search of fresh fodder. As the winter sets in, the community moves back to the forest stretches of RNP along with heir livestock herds. This well-planned and finely tuned transhumance not only helps to regenerate vegetation but also goes to provide nutritionally fortified grass in the upper Himalayan stretches.

On an average, a Van Gujjar family owns upto 25 heads of buffaloes which the family’s pride and treated with utmost care and affection. By all means buffaloes constitute the very bedrock of the livelihood of the community. Essentially, Van Gujjars practice a forest-based form of animal husbandry and produce good quality of milk and dairy products without any pesticide residues. As such the milk produced by the community fetches a good price in the urban centres of Uttarakhand and Uttar Pradesh.

The Van Gujjar settlements in RNP are distinguished by the buffalo herds roaming freely with a complete indifference to the world around. The most conspicuous feature of the social life of Van Gujjars is the intense, emotional attachment they have to the buffalo herds. Interestingly, the children suckle milk straight from the udders of the animals. As it is, the community plays a very crucial role in supplying milk and dairy products to travellers and pilgrims in the upper Himalayan reaches during the lean summer months.

One significant feature of the animal husbandry perfected by the community is the sustainable use of forest resources to meet the fodder needs the animals, thus leaving the agricultural land free for producing food crops. Moreover, this also provides their milk with a special flavour and enhanced quality.

In Kaushal’s view, the largely illiterate nomadic Van Gujjars have managed to retain a high genetic quality of their buffaloes without inbreeding. Kaushal points out that their method of feeding the buffaloes mainly on green fodder with a minimum amount of concentrate feed, can be great value to the development of animal husbandry in India. In recent years, Van Gujjars have been under intense pressure from RNP authorities to move out of their forest dwellings. For long, the RNP authorities have been blaming the buffalo herds of the community for the damages sustained by the park eco system.

However, Van Gujjars have refuted this allegation. In fact, a study of the Van Gujjar settlements  in the park area carried out in the second half of the 1990s by a team of students from London’s  Wye College has shown that lopping vegetation to obtain fodder  for the animals is highly scientific and totally sustainable. In the same vein, Swedish social anthropologist Pernelle Gooch, who was instrumental in persuading Avadesh Kaushal to fight for the cause of Van Gujjar says, “In winter the Van Gujjars feed their buffaloes with the leaves lopped from a certain species of trees. As they use the same tree year after year, it is of vital interest for them that the forest is regenerated”.

The total dependence of the community on forests and buffaloes for their survival is reflected in the statement of Dil Mohammed, a Van Gujjar chieftain, “neither we nor our buffalos are equipped to survive outside the forest environment”.

Sociologists working with the community point out that any change or experiment with a new profession, demands a complete change in lifestyle. Sain Bibi, a young Van Gujjar woman, laments the fact  that they are poor because  their livelihood is based on animals and  these can easily die, compared to ordinary farmers who still have their land if their  crops fail.---INFA

(Copyright, India News and Feature Alliance)