Western Ghats Field Research Station at Kozhikode

8/14/2019 Western Ghats Field Research Station at Kozhikode

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Western Ghats Field Research Station at Kozhikode (Calicut), Kerala state, was established in April, 1980, under the Sixth Five Year Plan of theGovernment of India.

INDIRA GANDHI Chairman

NARAYAN DATT TIWARI Deputy Chairman

R. VENKATARAMAN Member

M. S. SWAMINATHAN Member

MOHD. FAZAL Member

MANMOHAN SINGH Member-Secretary

The day will dawn. Hold thy faith firm "TAGORE

Progress in a country of India's size and diversity depends on the participation and full involvement of all sections of the people. This is possibleonly in democracy. But for democracy to have meaning in our circumstances, it must be supported by socialism which promises economic justiceand secularism which gives social equality. This is the frame for our planning.

The Planning Commission is to be congratulated on the manner in which it has worked practically round the clock to bring out the Sixth Plan in ayear as we had promised to do. The drawing up of this plan posed special difficulties. We faced a plan gap and a budget gap at a time when the


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whole world, and India more than other countries, was hard hit by inflation, the continuing rise in the price of petroleum while the price of our rawmaterials remains static, as well as other political and economic tensions and international confrontations.

In view of the severe financial constrictions and the political expectations, it is not surprising that the Plan should be unsatisfactory to many.However, this is no reason to denigrate it. Planning is more than the putting together of a number of Central and State Government projects. It is adirection. And this the Sixth Plan provides. Once the nation is clear about the path to be followed, the details can be adjusted as we go along.

Let us cast a backward glance. In the last thirty years, through our Plans we have built the foundations of a modem, self-reliant economy. We haveachieved self-sufficiency in food, diversified our industrial structure and made significant progress in science and technology. The continuity of theplanning process, with its thrusts and checks, has lielped us to create and renew national assets and to take up programmes for the ameliorationof the weakest strata and the uplift of the most backward regions. Economic growth must be balanced, it must ensure self-reliance, stability andsocial justice. All sections should be assured that there will be no discrimination. No society can prosper if merit is not given its due.

A developing nation must marshal its scarce resources for a concerted effort to build its capital base in various sectors of the economy to enhanceproduction capabilities and allow larger savings. Increased output and a balanced inter-sectoral allocation of the incremental savings promote

further development. So the process goes on.

The progress so far achieved has been steady and substantial, although somewhat slower than envisaged. The very process of developmentgenerates new expectations and makes fresh demands on resources. Our goal of self-reliance was bound to strain our external resources. Also,we were not allowed to concentrate undisturbed on our development endeavour, for there have been frequent challenges to national security.Another factor adding to the complication of our development is the continuous increase in population, primarily owing to the very success of ourprogrammes of public health and epidemic control, as a result of which infant mortality has decreased dramatically and life expectancy risen.

We have resolutely stood up to each new challenge. We have come to a stage where we can confidently assert that development has contributedto strengthening our nation in spite of its regional, linguistic, social and communal diversities. It has consolidated our democracy and is guiding oursociety towards socialism. We can now speak of an India in which the fruits of growth will reach to the last. This is a stage when the planningprocess assumes even greater importance.

Five-Year Plans are formulated in the perspective of long-term development. This enables us to raise the national effort to match specific goalsand meet critical challenges. Annual Plans give operational meaning to tlie exercise. Monitoring, review and evaluation procedures help to keepthe vessel on the course. The voyage has been longer and rougher than we had imagined, but there is little doubt about the rightness of thecourse we have charted.

The Sixth Plan envisages a significant augmentation in the rate of growth of the economy with an annual growth rate of over 5 per cent. In thisfive-year period we expect to see progressive reduction in the incidence of poverty and unemployment and also in regional inequalities. Greateremphasis has been laid on the speedy development of indigenous sources of energy and infra-structural sectors of coal, energy, irrigation and


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transport. High priority has been given to agriculture and rural development and allied agricultural activities like animal husbandry, dairying,fisheries and also the forestry sector, with accent on development and conservation. Substantial outlays have been allocated for expansion in coresectors and also for cottage, village and small industries as well as for programmes to provide minimum needs.

The measure of a plan is not intention but achievement, not allocation but benefit. We are determined to implement this Plan with steadfastness ofpurpose. Democratic planning means the harnessing of the people's power and their fullest participation. We sail on stormy seas. But the Indianpeople have weathered many storms. Their spirit is indomitable and it will prevail. Let us help them to bend their energies with unity and disciplinein the great endeavour to reach towards a brighter future.

(INDIRA GANDHI)

New Delhi

1. Development Performance

2. Development Perspective

3. Objectives and Strategies of the Sixth Five Year Plan

4. Public Sector Outlays

5. Resources for the Plan

6. Balance of Payments

7. Policy Framework

8. Plan Implementation, Monitoring and Evaluation

9. Agriculture and Allied Sectors10. Irrigation, Command Area Development and Flood

Control

11. Rural Development and Cooperation

12. Village and Small Industries

13. Manpower and Employment

14. Minimum Needs programmes

15. Energy

16. Industry and Minerals

17. Transport

18. Communication, Information and Broadcasting

19. Science and Technology

20. Environment

21. Education

22. Health, Family Planning and Nutrition

23. Housing, Urban Development and water Supply24. Labour and labour Welfare

25. Hill Area Development

26. Development of Backward Classes

27. Women and Development

28. Social Welfare
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29. APPENDIX

6th Five Year

Plan

[Home]


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growth initiated.

1.4 The grov/th performance of the economy in different plan periods is presented in Annexure 1.1. These data show that except for the Third Planwhere, in the last year of the Plan, the economy was badly hit by a severe drought, the rate of growth of national income has ranged between 3and 5 per cent which is a significant achievement. However, except in theFirst and Fifth Plan, the actual growth rates have been less than thehigher targets specified in the Plans:

Table 1.1 Targetted and Actual Growth Rates (Percentages)

Sl. No. Plan Target Actuals Growth rate for

(0) (1) (2) (3) (4)

1 First Plan 2.1 3.6 national income

2 Second Plan 4.5 4.0 national income

3 Third Plan 5.6 2.2 national income

4 Fourth Plan 5.7 3.3 net domestic product

5 Fifth Plan 4.4 5.2 gross domestic product.

Note: Targets were generally specified in terms of net national income/product upto the Fifth Plan in which for the first time, targets were specifiedin terms of gross domestic product.

The shortfall in the growth in national income has of course meant a corresponding shortfall in targetted levels of per capita income.

1.5 The growth of national income depends on a complex interaction of large number of variables, not all of which are amenable to government

control. However, it is well known that the quantum of investment and the productivity of this investment, as measured in a simplified model by thecapital output ratio, exercise an important influence on the overall growth rate. An approximate and first-order explanation for the gap betweentarget and actual levels of income growth can be found in a comparison of the trends in income and investment. The main conclusion siiesested bysuch a comparison is that shortfalls for excesses) in income growth are larger than what would follow from the shortfalls (or excesses) ininvestment. The main reason for this is that realised capital output ratios, particularly during the Third and Fourth Plan periods, have been muchhigher than anticipated. One further point in the comparison that is worth noting is that total investment targets have, by and Ipree. he^n me1' orexceeded m recent plans. However. in the Fifth Plan peno'd, the excess was due largely to hirher levels of private sector investment and stockaccumulation in the public sector. The with the Industrial Policy Resolution of 1956, articulated explicitly the objective of rapid industrialisation.


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Apart from rapid growth, this strategy involved certain other key components viz.. a shift in the industrial structure towards industries producingbasic materials and capital goods and the growth of the public sector in industry.

With the Industrial Policy Resolution of 1956, articulated explicitly the objective of rapid industrialisation. Apart from rapid growth, this strategyinvolved certain other key components viz.. a shift in the industrial structure towards industries producing basic materials and capital goods andthe growth of the public sector in industry.

1.21 At Independence we inherited an industrial structure that was restricted to a few industries like textiles and sugar. The first steel plant hadbeen set up and there was some limited development of engineering in railway workshops and assembly plants. the drive to diversify thisstructure, a drive linked to the search for self-reliance, has been the keynote of the industrial strategy of our plans. The extent of change broughtabout by this drive is indicated in Annexure 1.6. As these data show the relative share in industrial production of the traditional manufacturingsectors like food and textiles has declined and that of new sectors like chemicals and engineering has increased very substantially. In terms ofsophistication of technology and the range of goods manufactured an extensive degree of industrial diversification has been achieved.

1.22 The organisation of industry has also undergone a major change with the development of the public sector. Between 1960-61 and 1977-78,the share of the public sector in the value added in mining and organised manufacturing grew from 8.1 per cent to 28.9 per cent. The developmentof the public secior has been the principal element in our drive for industrial diversification and in industries like steel, non-ferrous metals,petroleum, fertilisers, petrochemicals and heavy engineering, public sector units play a dominant role-

1.23 The industrial policy of the Government accepted the important role of the private sector and an elaborate network of institution has beenestablished to support it and to regulate its activities. A major component of the support system is the network of development banking institutionswhich have been established to finance private investment in industry. The cumulative disbursements of these institutions amounted to over Rs.5,000 crores by March, 1979 of which over 80 per cent was disbursed in the last ten years. Apart from these development banks, the governmenthas set up a variety of institutions to assist in the provision of infrastructure, raw material supply, marketing and technology development. Smallscale industries and artisans have also been protected through product reservations and fiscal concessions. The regulatory framework for

controlling the pattern of private industrial investment was set up in the early years of the planning era with the Industries (Development andRegulation) Act and elaborated later through the Monopolies and Restrictive Trade Practices Act and other measures. The manner in which theseregulatory functions have been exercised has been reviewed from time to time and appropriate changes made. The institutional framework forsupporting and regulating private industry is by no means perfect. The essential point, however, is that a variety of institutions and agencies havebeen established and have succeeded in stimulating the development of new industrial activities, new centres of industry and new entrepreneurs.But their success in these matters is less than what we sought and hence there is a need for adapting and elaborating both the support systemand the regulatory framework to suit the fast changing needs of a diversified industrial economy.


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1.24 The tasks of modernisation and structural change in agriculture were even more daunting at the start of the planning era. The outmoded landtenure system, the primitive technology of cultivation and lack of an infrastructure for raising productivity proved formidable barriers to agricultural

advance. The fact that these barriers have been overcome to an extent is one of the major successes of our planning effort. Zamindari and otherintermediary tenures have been almost eliminated. The technology of cultivation has changed substantially with the spread of high-yieldingvarieties and the extension of irrigation, a change which was facilitated by the elaborate network of agricultural research and extension set upduring the planning era. One further change of consequence is the establishment of a system of support prices, procurement and publicdistribution. Significant progress has been made no't only in the production of major foodgrains but also in horticultural crops like apples andanimal products like eggs, milk and fish.

1.25 Some data on the indicators of modernisation in agriculture are presented in Annexure 1.7. The growth in irrigation is a common featurewhich runs through the plans though the pace of expansion in recent years is far higher than before. The use of the new technology based on highyieldina varieties and fertilisers spread rapidly only after 1965. This difference is reflected in the larger contribution of productivity "ain to productiongrowth in the period after 1964-65, the relevant annual growth rates being as follows:

Table 1.3 Growth Rate of Area, Production and Yield

Sl.No. Item Foodgrains Non-foodgrains

1949-50 to1964-65

1964-65 to1978-79

1949-50 to1964-65

1964-65 to 1978-79

(0) (1) (2) (3) (4) (5)

1. Area 1.4 0.6 2.5 0.8

2. Production 3.0 3.4 3.5 2.6

3. Yield 1.4 2.3 1.0 1.3

The process of technological modernisation in a culture has, however, just begun. Average yield le in most regions and farming systems are belowv can be attained with known technology. We need to extend modern technology to new areas, develop a technology for ecologically handicappedregions and utilise fully our irrigation potential as well as the potential of rainfed areas.

1.26 Several changes have taken place in agricultural credit and marketing. The system or cooperative credit has spread, lessening thedependence of the cultivator on exploitative moneylending and trading practices. Institutional term finance lor agriculture has grown with thereorientation of the banking system and the establishment 01 Land Development Banks, Regional Rural Banks and apex in'siitirtions like theAgriculture Refinance and Development Corporation. In agricultural marketing, the dominant role of the Food Corporation of India in foodgrain


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trade and the growth of marketing and processing cooperatives have helped both farmers and consumers. In the case of milk, cooperatives andurban milk supply schemes have captured, a substantial part of the market. These and other change's in the field of credit and marketing have

altered the very unequal relationship between the farmer and the trader and, by doing so, have stimulated agricultural progress.

1.27 The foundations of industrial and agricultural advance lie ultimately in the availability and effective use of human skills. All our plans haveemphasised the need to develop these skills at all levels from those required at the shop floor or the farm to those required in fundamentalresearch. In agriculture, an integrated system involving research institutes, agricultural universities and an extension machinery has been set up.In Industry, there is a network of industrial research laboratories, R&D divisions in major enterprises and consultancy firms for project consultancyand design engineering. At the shop floor level there is no major shortage of industrial skills. The basis for this major advance lies in the rapidexpansion of technical education. Thus, between (1950-51 and 1975-76), the number of students in engineering, technological colleges increasedfrom 13 thousand to 286 thousand and in Industrial Training Institutes from 10 thousand to 138 thousand. The same picture holds true for othercategories like scientists, doctors and agricultural graduates. In fact, India now has the third largest scientific and technical work force in the world.However, the capacity of the system to absorb fully these skills in productive employment has been less '''in adequate. Also in pure and appliedresearch advances have been limited except in a few areas like agricultural research, atomic energy and space. At the farm or shop floor level,

average productivity levels are below what can be attained with known technology. Human skills are a formidable asset since they last not merelyduring one working life but because they are transmitted, for generations. If these assets are used effectively, they may w-!l turn out to be one ofthe most fruitful results of pi'inning.

1.28 The mobilisation of savings and their use in preferred directions is a crucial element in any development effort. Our success in this regard hisbeen dealt with earlier. A significant feature of the savin"-; mechanism has been the growing fungibility of savings as the share of savingsaccumulated by households in the form of deposits, shares, debentures, life insurance and pension funds has increased from 10.0 per cent of netsavings in 1950-51 to 33.0 per cent in 1978-79. Thus, primitive processes of accumulation in which households and small enterprises invest ineirsavings directly in their own activities or in currency hoards have given way to more complex forms in which, through financial intermediaries andcapital markets, households savings can be channelled into a much wider variety of activities.

1.29 There is one quaiification, however, to this picture of a deepening of financial structure. The market for corporate issues continues to remainvery narrow. .Net household savings in the form of coi-porate shares and debentures which amounted to 8.0 per cent of savings in 1950-51 havetended to stagnate even in nominal terms and, in 1977-78, when they were well above the trend, they amounted tc only 2.1 per cent of netsavings. Since the share of corporate savings in total savings has also tended to decline, it has become increasingly difficult to maintain the tempoof development in the private corporate sector though the deficiency has been covered to a considerable degree by the growth of developmenibanking which was mentioned earlier.

1.30 The pattern of utilisation of savings has beer influenced by several innovations like the development banks for industry and agriculture and


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the system of cooperative credit. A major change in the functioning of capital markets was effected through the nationalisation of banks in 1969after which there has been a substantial increase in bank lending to agriculturists, artisans, small industrialists and transport operators and others

whose access to bank credit was hitherto severely limited.

1.31 Planning implies state intervention in economic matters which involves not just a few big projects but also a large number of small works andprogramme directed at individuals. At Independence we inherited a patchy administrative structure oriented toward; maintenance of law and orderand revenue adminis tration. Over the planning period an elaborate development administration has been built up from th village, through the blockand district to the secretariat level. Though there are deficiencies in this structure in terms of motivation, probity and efficiency it at least provides apoint of contact between th government and the household or the enterprise. A further change has been introduced by the establishment ofpanchayati raj which, in many states, play an important role in development administration.

1.32 Over thirty years of planning the structure of the Indian economy, the technology of production in agriculture and industry and the institutionframework within which economic activities are conducted have changed substantially. The bedrock on which these changes are based lies in thetremendous growth in human skills and, because of this firm base, the force of modernisation and technological advance are firm Iv entrenched inall sectors of the economy even though the pace of diffusion varies from one sector to anothe and from one region to another. The major problem

the extension of scholarships for weaker sections and better geographical spread of institutions. Yet the illiteracy rate remains large (65.5 per centin 1971 ex-cirding the 0-4 age group) and the quality of the schooling provided needs substantial improvement. Besides these two major socialservices, public expenditure has provided water supply and other municipal services in urban slums and in villages, house sites for the poor inrural areas and supplementary nutrition for vulnerable mothers and children, all of which benefit the poor but do not necessarily show up in thedata on consumption expenditure.

1.48 An individual obtains an income from the ownership of assets and from employment. The limited impact of the Plans on the well being of thepoor sections of the population is a consequence of our inability to restructure the distribution of assets and to provide a sufficiency of employmentfor a growing work force.

1.49 Accord^e to the all India debt and investment survey tb distribution of assets in rural areas, where the bulk of the population lives, was asfollows:

Table 1.5 Distribution of Assets in Rural Areas (Percentage)


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S). No. Percentage share in assets of 1961 1971

(0) (1) (2) (3)1 Lowest 10% 0.1 0.1

2 Lower 30% 2.5 2.0

3 Top 30% 79.0 81.9

4 Top 10% 51.4 51.0

These figures bring out the very low level of asset hakims'; o" the poorest 30 per cent in rural areas. They also show that there has not been anymajor change in the structure of asset ownership in rural areas during the sixties. In fact if 'poor' householders ai'3 defined as those with less thanRs. 1000 of assets in 1961 or, to allow for inflation, Rs. 2500 in 1971, the percentage of such households increased from 30 per cent in 1961 to 35per cent in 1971. The bulk of the assets of these poor housaeholds consist only of their huts, some household goods and some livestock.

1.50 The principal productive asset in rural areas is land which in 1976-77 was distributed as follows:

Table 1.6 Distribution of land(percentage)

Sl. No. Operational holdings of Number Area operated

(0) (1) (2) (3)

1 Less than 2 hectares 72.6 23.5

2 210 hectares 24.4 50.2

3 Over 10 hectares 3.0 26.3

Small and marginal farmers who constitute over 70 per cent of the landholders operate barely 24 per cent of the land. The very substantialimprovement in agricultural productivity brought about by irrigation and the new seed-fertilizers technology improve directly the earning power ofagricultural land and only indirectly that of agricultural labour. Hence agricultural growth by itself may not solve the problem of poverty. It is,therefore, necessary to adopt positive measures combining a mix of employment generation, diversification of occupations, land reforms,reorientation of the credit systems and massive public investment in rural infrastructure so as to ensure that the fruits of economic progress aremore equitably distributed in rural areas.

1.51 The programme of land reforms instituted right at the beginning of the planning period was meant to redistribute this primary resource. The


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first phase of this programme which involved the abolition of zamindari and intermediary tenures has been, to a large extent, successfullyimplemented. The later phases of land reform involved elements like tenancy reforms, protection of share-croppers, land ceiling and land

consolidation. The pace of implementation of these measures particularly of ceiling legislation has been slow and full of loopholes so that theirimpact on the structure of land holdings has been minimal. The land reform programme is by no means complete and has to be pursued further ifwe are to tackle effectively the problems of poverty and inequality.

1.52 Trends in the ownership of assets in urban areas are less fully known. The principal instruments used to influence the distribution of assetsother than land are essentially fiscal in character e.g. progressive taxation of income and wealth and the preferential treatment of poorer sectionsin the provision of credit. The extent to which progressive taxation has helped to check inequalities his been limited by tax evasion which createsthe further problem of black money and ostentatious consumption. The one direct measure to control the distribution of assets in urban areas viz.(he Urban Land Ceiling Act has faced major difficulties in implementation. In an indirect way the growth of the public sector in industry and thenationalisation of almost the entire financial system have probably helped to restrict the number of people at the very top of the income distribution.

1.53 The limited success m redistributing assets may not have mattered as much for poverty reduction had employment increased at a faster rate.Such a growth m employment would have increased incomes both by reducing idle time and by exerting an upward pressure on wages. However,the pace 01 generation a employment opportumtit-s seems to have lagged behind me growth in the labour force.

Thus the Rural Labour Enquiry has shown that between 1964-65 and 1974-75, the number of days for which employment was available for rurallabourers declined by 10 per cent for men, 7.5 per cent for women and 5 per cent for children. The data on average earnings from these enquirieswhen corrected for inflation also show a decline, in urban areas the figures for the number of persons en tile live register provide some indicationof the trend. These figures show an increase from 1.6 million in 1960 to 12.7 million in 1978, an increase that is attributable partly to changes incoverage but which nevertheless reflects a substantial deterioration in the availability of employment. Direct data on unemployment from theNational Sample Survey are unfortunately not comparable over time. However, the latest available data for 1977-78 show the following person-dayunemployment:

Table 1.7 Rates of unemployment by Daily Status(Percentage of labour force)

Sl. No. Category Rural Urban

(0) (1) (2) (3)

1 Male 7.1 9.4

2 Female 9.2 14.6


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The average over all categories is 8.2 per cent which in terms of absolute numbers means that on a typical day about 21 million persons areseeking and available for work but unable to find it. A major challenge of the decade that lies ahead is the speedy expansion and diversification of

opportunities for productive employment.

1.54 Problems of poverty and unemployment have been greatly aggravated by the rapid expansion in population and labour force. Poorhouseholds are often above average in size. This, at least partly, accounts for the low level of consumption and the incidence of unemployment. Alower family size in these households and the consequential reduction in the growth rate of population would have made it easier to move closer tothe plan objectives of removing poverty and unemployment.

1.55 The search for social justice has one further dimension that has been articulated in our plans; The desire to reduce regional imbalances. AtIndependence we inherited an economy where industry and modem agriculture had developed only in a few pockets. the deliberate policy 01industrial dispersal mat we have followed has led to the development of some new industrial centres situated away from the older centres situatedlike Bombay, Calcutta and Ahmedabad, but the degree of success achieved is limited since even in 1971 around 27.5 per cent of the employmentm manufacturing was concentrated in 9 towns. In agriculture the lack of diffusion of the new seed-fertiliser technology has probably accentuatedregional imbalances and in 1977-78 the value of agricultural output per head of rural population ranged between Rs. 866 in Rajasthan and Rs.3361 in Punjab. These imbalances in the pace of agricultural and industrial advance are reflected in the large differences between states in thepercentage of population below the national poverty line. The data for 1977-78 given m Annexure 1.12 show a range from 15 per cent 1.11 Punjabto 66 per cent in Orissa. The geographical spread of industry and modern agriculture is undoubtedly better now than at the start of the planningera but it is clear that we have a long way to go in this task of reducing regional imbalances.

1.56 A simple summary assessment is not possible about the extent to which plan objectives with regard to social justice have been attained.There are no specific quantified targets against which performance can be compared since what the plans indicate is a direction of movement, nota specific goal. The evidence presented above suggests that the most that can be claimed is that there has been no perverse movement, noworsening of inequalities or in the incidence of poverty. In fact, in some respects a degree of progress has been achieved. But, on balance, thepace of movement is much slower than what is acceptable or possible within the framework of the plans air-a greater degree of redistributive bias

has to be built into our development effort.

CONCLUSION

1.57 In the eighties, the economy is faced with a formidable task of maintaining and accelerating the tempo of economic growth in face of a sharpdeterioration in the international environment. The ever rising prices and highly uncertain supply of imported energy can disrupt the implementationof development plans. Nevertheless, the fact that the economy now enjoys the advantages of a high savings rate, a developed skill base and asubstantial degree of self-reliance provides a valuable cushion to absorb external shocks. If these advantages are to be turned to good account,


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we need to learn certain important lessons from our past experience.

1.58 With regard to growth and modernisation the first lesson is that we must mobilise resources to maintain and increase the tempo of investmentand protect the size of the Plan both against inflation and external disturbances. The second is the paramount need to improve efficiency in keyinfrastructural and industrial sectors. The third is that we must reduce the variability of the growth rate and ensure that weather abnormalities andinflation do not lead to undue cutbacks in public or private investment. The fourth is the need to extend the agricultural revolution to all areas andfarming systems and in particular to ensure that the incomes of the poor are raised in the process of agricultural development. The fifth is the needto ensure a vigorous expansion in exports and a rapid increase in domestic production of oil, steel, fertilisers and vegetable oils so as to restraingrowth of imports in order to maintain viability of our external payments. Sixth, we must develop effective domestic substitutes for imported energyso that our dependence on imported oil is contained within reasonable limits. Finally, there is urgent need to revitalise the family planningprogramme so as to bring about a substantial decline in me birth rate through the voluntary adoption of the small family norm. Success on all thesepoints is essential if the overall rate of growth is to be raised, as it must be, well above the levels reached in the past.

1.59 As far as self-reliance is concerned the economy today is in a stronger position than at the start of the planning era. Dependence on externalfinance has been substantially reduced and in many areas of production, a high degree of import substitution achieved. But there are manyunfinished tasks in this area, particularly in the field of energy and technology. The world economy is in a much more disturbed state since the midseventies than at any time in the past three decades and there is an atmosphere of confrontation rather than cooperation in international economicrelations. In this situation the objective of self-reliance needs to be pursued with continuous vigour. However, self-reliance can no longer take theform of indiscriminate import substitution. There is a continuous need to replace imports in critical areas where there are sudden and sharpchanges in prices and availability. But, as the complexity of the economy grows, import requirements will also increase and in order to financethese, export earnings will have to be stepped up substantially. In the eighties, export promotion is as much a part of the drive for sell-reliance asefficient import substitution.

1.60 With regard to social justice, what we have achieved is far short of what we aimed at. After three decades of planned development largesegments of the population have yet to share in the benefits of progress or participate in the process ot development. From the Fourth Plan,

several programmes for assisting backward areas and weaker sections have been in force. Yet, judging by the statistics on asset distribution,employment and consumption the impact seems to be limited. What is needed is a more effective implementation of asset transfer measures suchas land reforms, more equitable distribution of credit and a coordinated effort that enables the poor to join the mainstream of economic activity andprovides them with an opportunity for advancement. This will require firstly, an improvement in their productivity and earning power in their existingactivity, secondly, supplementary employment in new activities to use up any spare labour time and thirdly, training, credit and support systems toassist them in both their existing and new activities.

1.61 Growth, modernisation, self reliance and social justice are not independent objectives. They are linked in that success with respect to any one


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makes it easier to achieve the others. The sustained growth of the past thirty years and the very considerable diversification of our economicstructure that has taken place during this period constitute positive national assets for launching a more direct attack on poverty and under-

development in the Sixth Plan, However, the enormity of the task should not be underestimated, particularly in view of a sharp deterioration in theexternal environment. The nation will have to mobilise all its latent energies for a more vigorous pursuit of cherished national objectives ofaccelerated growth, greater social justice and a modern self reliant economy.

Annexure 1.1Growth Performance in the Plans

Sl. No. Items First Plan1951-52 to55-56

Second Plan1956-57 to 60-61

Third Plan1961-62 to65-66

Annual Plans1966-67 to 68-69

Fourth Plan1969-70 to

73-74

Fifth Plan*1974-75 to

78-79

3950-51 to1978-79

(0) (1) (2) (3) (4) (5) (6) (7) (8)

Annual Growth rates

1 National income 3.6 4.0 2.2 4.0 3-3 5.4** 3.5

2 Agricultural Production 4.1 4.0 (~)1.4 6.2 2.9 4.2 2.7

3 Industrial Production 7.3 6.6 9.0 2.0 4.7 5.9 6.1

4 Per Capita Consumption 1.7 1.8 0.1 2.0 0.4 2.3 1.1

5 Gross Fixed Investment 3.0 5.8 8.7 1.5 3.1 6.6 5.5

Note: Col. 8 gives the trend rate calculated from a semilog regression. All other columns give compound growth rates between the base yearbefore the Plan and the last year of the Plan.*For the time period orginally envisaged for the Fifth Plan.

**This. is the growth rate for net national product (national income). The growth rate of gross domestic product over this period was 5'2 per centas referred to in Table 1.1.

Annexure 1.2 Resource Mobilisation


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Sl. No. Item Pre-plan1950-51

End ofFirst Plan

55-56

End of SecondPlan 60-61

End of ThirdTPlan 65-66

End of AnnualPlan 68-69

End of FourthPlan 73-74

End ofFifth Plan

78-79*

(0) (1) (2) (3) (4) (5) (6) (7) (8)

Percentage ofGD.P atcurrent market prices

1 Gross capital formation ..... 10.0 14-3 16-9 18-2 15-4 20-0 23'7

2 Gross domestic savingShare in net domestic saving(Percentage)

10-2 13-9 13-5 15-6 14-1 19-3 23-9

3 Household saving in financialassets other than currency

and claims on thegovernment .

10-0 15-3 19-1 31-1 20-5 28-3 32-9

4 Public Sector saving ..... 18-9 10-6 23-3 23-1 17-3 12-9 19-0

5 Private Corporatecooperative sector saving

6-8 6-2 8-8 3-9 2-6 5-7 2-8

The figures given are for the originally envisaged terminal year of the Fifth Plan.

Annexure 1-3 Distribution of Rainfall Divisions According; to Scanty or DeficientRainfall1951 to 1976


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Sl. No Item 1951-55 1956-60 1961-65 1966-70 1971-76

(0) (1) (2) (3) (4) (5) (6)i No. of Divisions without a single

deficient/scanty year21 22 15 11 5

2 No. of Divisions with one deficient/scantyyear .....

11 7 16 18 16

3 No. of Divisions with two deficient/scantyyears .....

3 6 4 3 10

4 No. of Divisions with three deficient/scantyyears ....

3 4

Annexure 1.4 Frequency Distribution of Annual Growth Bates 1951-52 to 1978-7&

Sl. No. Range National Income Agricultural Production Industrial production*

(0) (1) (2) (3) (4)

1 10% or Less

2 10%to-5% 1 3

3 -5%to-2% 1 2

4 -2%to0% 1 4 2

5 0% to +2% 6 4 3

6 +2% to+5% 6 2 4

7 +5% to+10% 13 6 15

8 -HO% or More 6 3For Calendar years from 1952 to 1978.

Annexure 1.5: Composition of Gross Domestic Product (at 1970-71 prices)(Percentages)


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SI. No. Sector Pre-plan1950-51

End of firstPlan 55-

56


End of ThirdPlan 65-66

End of AnnualPlan

68-69

End of FourthPlan 73-74

End ofFifth Plan

78-79**(0) (1) (2) (3) (4) (5) (6) (7) (8)

1 Agriculture and allied sectors 58-9 57-3 54-2 45-6 (49-9) 46-3 45-2 41-6

2 Mining, Manufacturing andconstruction

14-9 15-9 17-7 22-0 (20-0) 21-2 21-6 22-5

3 Electricity, Gas, Water supply,transport. Storage andCommunication

3-9 4-2 4.9 6-1(5-4)

6-4 6-8 7-4

4 Services 22-3 22-6 23-2 26-3 (24-5) 26-1 26-4 28-5

total 100-0 100-0 100-0 100-0 100-0 100-0 100-0

Figures in brackets are for 1964-65 which may present a more correct picture since agricultural output in 1965-66 was badly affected by the

drought.**The figures given are for the originally envisaged terminal year of the Fifth Plan.

Annexure 1.6 Industrial Structure


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Sl.No.

Sector Weights in the Index of Industrial Production* Value added in registered manufacturing

1956 1960 1970 1970-71 1977-78

(0) 0) (2) (3) (4) (5) (6)

I Food ............ 15-7 14-2 9-5 9-3 9.9

2 Textiles ....... .... 47-0 31-9 21-5 20-1 19-4

3 Rubber,Chemical andPetroleum .......

11-7 12-9 18-2 17-3 19-9

4 Non-metallicminerals .........

2-8 4-5 4-1 4-0 4-1

5 Basic metals...........

10-4 8-7 10-9 9.9 10-2

6 Engineering...........

8-3 19-7 25-9 24-9 25-9

7 All others ........... 4-1 8-1 9.9 14-5 10-6

total 100-0 100-0 100-0 100-0 100-0

*Excluding mining and quarrying and electricity.

Annexure 1.7 Technological Change in Agriculture


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Sl.No. Item Pre-Plan1950-51

End ofFirst Plan

55-56


End ofThird Plan

65-66

66-67 67-68 68-69 End of FourthPlan 73-74

End ofFifth Plan

78-79*

(0) (1) (2) (3) (4) (5) (6) (7) (8) (9) (10)

1 Percentage of grossirrigated area to grosssown area

17-1 17-4 18-3 19-9 20-8 20-3 22-2 23-7 28-0

2 Fertiliser consumption(kg/ha)

0-5 0-9 1-6 5-1 7-0 9.4 11-0 10-7 29-5

3 Percentage of Rice andWheat area under HYV

(a) Rice .. 2-5 4-9 7-3 26-1 41-8

(b) Wheat .. .. .. .. 4-2 19-6 30-0 59-2 71-1

4 Average yield

(a) Rice (qtl/ha) . 6-7 8-7 10-1 8-6 8-6 10-3 10-8 11-5 13-3

(b) Wheat (qtl/ha) 6-6 7-1 8-5 8-3 8-9 11-0 11-7 11-7 15-7

*The figures given are for the originally envisaged terminal year of the Fifth Plan.

Annexure 1.8 Gross and net aid by Plan Periods(Rs. crores)


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Sl.No. Period Utilisation of ExternalAssistance

Amortisation and Interestpayment

Net Aid Net Aid as% of PlanExpenditure

Net Aid as% ofImports

(0) (1) (2) (3) (4) (5) (6)

1 First Plan 51-52to 55-56 .........

201-7 23-8 177-9 9-1 4.9

2 Second Plan 56-57 to 60-61 ........

1430-4 119-4 1311-0 28-1 26-9

3 Third Plan 61-62to 65-66 . ........

2867-7 542-6 2325-1 27-2 37-5

4 Annual Plans 66-67 to 68-69 ........

3229-6 982-5 2247-1 33-9 37-5

5 Fourth Plan 69-70 to 73-74 ........

4183-7 2445-0 1738-7 11-2 17-6

6 Fifth Plan 74-75to 78-79 ........

7309-5 3770-4 3539-1 8-9* 12-8

*0n actual expenditure for the first four years, anticipated expenditure for 1978-79.

Annexure 1.9 Import Substitution (Percentage share of imports in indigenous supplies)


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Sl.No. Item Pre-Plan50-51

End ofFirst Plan

55-56


End of ThirdPlan 65-66

End of AnnualPlans 68-69

End of FourthPlan

73-74

77-78

(0) (1) (2) (3) (4) (5) (6) (7) (8)

I Foodgrains 5-9 1-7 4-7 9-5 5-6 4-3 0-2

2 Iron & Steel . 25-2 39-9 35-7 16-7 9-3 ,18-5 1-1

3 Machinery* 68-9 41-0 40-7 27-8 24-6 17-0 15-3

4 Petroleum . 92-5 93-8 94-6 76-6 66-2 70-8 63-1

5 Nitrogenous fertilisers 72-5+ 39-8 80-3 58-3 60-9 38-3 27-5

*Imports as a percentage of machinery component of gross investment. @ On calendar year basis. +For 1951-52.

Annexure 1.10: Growth in Exports (Annual growth rate in values at current dollars)

(Percentage)

Sl. No. Region First Plan1951-56

Second Plan1956-61

Third Plan1961-66

Annual Plans1966-69

Fourth Plan1969-74

Fifth Plan1974-79*

(0) (1) (2) (3) (4) (5) (6) (7)

1 India ....... 1-8 0-7 4-8 1-5 10-7 17-3

2 All developing countries of

which

5-1 2-8 5-9 6-2 20-3 21-6

3 (a) Major Petroleum exporters 12-3 5-3 6-6 7-9 24-3 27-2

(b) Fast growing exporters ofmanufactures

Nil 1-0 5-5 7-0 24-7 19-4

4 All countries ...... 9-1 6-4 7-8 8-6 19-2 17-4

Note:These compound growth rates are based on an end-to-end comparison of calendar year data reportedin 'Handbook on International Trade


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and Development Statistics, UNCTAD, 1979'. * For the time period originally envisaged for the Fifth Plan.

Annexure 1.11: Distribution of Household Consumer Expenditure(Percentages)

Sl. No. Category 1958-59 1961-62 1965-66 1970-71 1972-73 1977-78

(0) (1) (2) (3) (4) (5) (6) (7)

RURAL

1 Bottom 30 percent 13-1 14-7 15-1 15-4 15-4 15-0

2 Middle 40 percent 34-3 33-2 34-3 35-1 33-7 33-1

3 Top 30 percent 52-6 52-1 50-6 49-5 50-9 51-9

URBAN4 Bottom 30 percent 13-2 12-9 13-6 13-7 13-8 13-6

5 Middle 40 percent 31-7 31-4 31-9 31-8 31-9 32-4

6 Top 30 percent 55-1 55-7 54-5 54-5 54-3 54-0

Annexure 1.12Percentage of population below the poverty line by States separately for rural and urban areas, in 1977-78


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Sl.No. State/U.T. Rural Urban Combined

(0) (1) (2) (3) (4)1 Andhra Pradesh 43.89 35.68 42.18

2 Assam 52.65 37.37 51.10

3 Bihar 58.91 46.07 57.49

4 Gujarat 43.20 29.02 39.04

5 Haryana 23.25 31.74 24.84

6 Himachal Pradesh 28.12 16.56 27.23

7 Jammu & Kaslunir 32.75 39.33 34-06

8 Kamataka 49.88 43.97 48.34

9 Kerala 46.00 51.44 46.9510 Madhya Pradesh 59.82 48.09 57.73

11 Maharashtra 55.85 31.62 47.71

12 Manipur 30.54 25.48 29.71

13 Meghalaya 53.87 18.16 48.03

14 Nagaland N.A. 4.11 4.11

15 Orissa 68.97 42.19 66.40

16 Punjab 11.87 24.66 15.13

17 Rajasthan 33.75 33.80 33.76

18 TamilNadu 55.68 44.79 52.12

19 Tripura 64.28 26.34 59.73

20 Uttar Pradesh 50.23 49.24 50.09

21 West Bengal 58'94 34.71 52.54

22 All Union Territories 34.32 17.96 21.69

All India (weighted) 50.82 38.19 48.13


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Note: 1. The above estimates are derived by using the al 1-India poverty line of Rs. 65 per capita per month in 1977-78 prices correspondingminimum daily calorie requirement of 2400 per person in rural areas and the poverty line ofRs.75 per month corresponding to daily calorie

requirement of 2100 in urban areas.

2. These results are based on the provisional and quick tabulation of the National Sample Survey (NSSO) on household consumer expenditure of32nd round (July, 1977 to June, 1978).

3. The difference between the aggregate all India private consumption expenditure estimated by the Central Statistical Organisation in theirNational Accounts Statistics and that derived from the NSSO data has been adjusted prorata among the different States and Union Territories inthe absence of any other information which could be used to allocate this difference among the States and Union Territories.

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