Assignment Report

On

“Economy of Kerala”

By

Yakshika Vats

A3104613211

B.Com (H)

2013-2016

Under the supervision of

Shipra Maitra

Head of Department

ACCF

Amity College of Commerce and Finance

Amity University, Sec- 125

Noida, Uttar Pradesh

Economy of Kerala

As part of the Indian Union, Kerala's economy is deeply affected by the downturn in the national economy. While Kerala has a lot to offer to the rest of the country in terms of excellent human capital formation, high environmental standards, remarkable tourist sites, inflow of remittances from abroad, good decentralized governance and so on, it is highly dependent on the rest of India (and abroad) for food, fuel, basic industrial goods, a variety of consumer goods and even on migrant labour from other states. This chapter gives an account of important economic features of Kerala as a whole – trends in population and urbanisation are analysed as they have a major impact on other critical economic parameters such as poverty, productivity and growth.

    Availability of capital resources (public finance and institutional finance) has also been discussed at length, because affordable finance acts as a spur to the development of an economy. Inflationary pressures, especially in food, fuel and housing can be highly detrimental to welfare of the people. The importance of systematic planning and careful monitoring of its implementation is also critical for the development of the country. Some of these issues are dealt with in this chapter.

Government of Kerala has a secretariat of its own. It is the highest echelon of state administrative structure offering locus for the exercise of authority by state Government. The secretariat refers to the complex of departments. So the government departments are classified according to the functions defined: Secretariat departments and Field Departments.

Its political heads are ministers while the administrative heads are secretaries to the Government. The entire administrative machinery of the state is divided into several departments. This section profiles the various departments of the state. Details of each departments such as

organisational structure, list and addresses of area wise offices, programmes, schemes, services, application forms with details, latest Government orders, achievements, success stories etc. are provided.

Classification of the Economy

Primary Sector: This sector includes all those economic activities where there is the direct use of the natural resources as Agriculture (Agriculture proper & Livestock), Forestry & Fishing, Mining & Quarrying

Secondary Sector: This sector uses the produce of the primary sector as its raw materials. Manufacturing (Registered & Unregistered), Electricity, Gas , Water supply & Construction.

Tertiary Sector: This sector concerns with service oriented aspects of the economy. It includes Transport, Storage & Communication, Trade, Hotels& Restaurants,

Banking & Insurance, Real Estate, Ownership of Dwelling & Business, Public Administration& Defence, Other Services.

Income of the State

It includes concept like GDP ( Gross Domestic Product)/ GSPD ( Gross State Domestic Product)

GDP per capita/GSPD per capita

GDP growth rate/ GSPD growth rate

14%

20%

66%

Sectoral Distribution of GSDP of Keralaat constant prices 2013-14 (Quick)

Primary Sector Secondary Sector Tertiary Sector

GDP of Kerala & India Gross Domestic Product (at factor cost) - at current prices (Base Year 2004-05)

Year GSDP of

Kerala

(Rs in

Lakhs)

GDP of All

India (Rs in

Lakhs)

%

contribution

of Kerala to

All India

GDP

Per Capita

(GSDP) of

Kerala (In

Rs)

Per Capita

(GDP) of

India (In

Rs)

Growth rate

of Kerala

over

previous

years (%)

Growth rate

of All India

over

previous

years (%)

2006-07 14166669 356436384 3.89 47031 35234 12.38 16.60

2007-08 15409268 389663641 3.82 53305 40264 13.89 15.91

2008-09 16265920 415867595 3.82 61420 45958 15.78 15.75

2009-10 17757135 451607088 3.80 69929 52213 14.41 15.18

2010-11 18985071 491853300 3.64 79120 61120 13.70 18.66

2011-12 20095773 524753000 3.73 93332 69814 18.54 15.77

2012-13

21285953 548211100 3.70 103321 77148 11.25 11.88

2013-14

(Q)

22620850 574179000 3.78 117132 84938 13.93 11.54

GDP of Kerala & India Gross Domestic Product (at factor cost) - at constant prices(Base Year 2004-05)

Year GSDP of

Kerala

(Rs in

Lakhs)

GDP of All

India (Rs in

Lakhs)

%

contribution

of Kerala to

All India

GDP

Per Capita

(GSDP) of

Kerala (In

Rs)

Per Capita

(GDP) of

India (In

Rs)

Growth rate

of Kerala

over

previous

years (%)

Growth rate

of All India

over

previous

years (%)

2006-07 14166669 356436384 3.97 43325 31768 7.90 9.57

2007-08 15409268 389663641 3.95 46899 34241 8.77 9.32

2008-09 16265920 415867595 3.91 49267 36037 5.56 6.72

2009-10 17757135 451607088 3.93 53524 38599 9.17 8.59

2010-11 18985071 491853300 3.86 56947 41472 6.92 8.91

2011-12 20095773 524753000 3.83 59985 43657 5.85 6.69

2012-13

(P)

21285953 548211100 3.88 63227 45046 5.92 4.47

2013-14

(Q)

22620850 574179000 3.94 66862 46568 6.27 4.74

DEMOGRAPHIC INDICATORS

The state of Kerala has carved out a separate niche for itself in development discourse due to its impressive performance over the years in the demographic and social development front. Kerala is widely cited as a unique example of having positive demographic transition despite poor economic development. It is a model for the rest of India in demographic achievements and attracts international attention. Over the 100 years, Kerala's population increased five times from 6 million in 1901 to 32 million in 2001. Among the different states of India, Kerala ranks 12th in terms population and it has 3.1% share of the population in India. The population of Kerala is 31.84 million, of which 15.4 million were males and 16.3 million were females living in around 6.5 million households Census 2001). Here women constitute 51.4 percent of the total population of the state such that the women outnumbered men by 9 lakhs.

Over the years, Kerala registered a slower pace of population growth rate than in India. However, the growth rate during the last decade worked out to 9.4 percent - the lowest after the formation of the state. At the national level, the growth rate was 21.3 percent. It is appreciable that, despite sluggish economic growth, Kerala had achieved this low growth of population. No wonder, mortality, migration, fertility have played an important role in the dynamics of this low growth of population in Kerala. The decadal growth rate was highest in Malappuram district (1.59%) and the lowest was recorded in Pathanamthitta district (0.36%). Malappuram districts had achieved a deduction of about 11 points between the two (1981-1991, 1991-2001) decadal growth rates, which is the highest among the districts of Kerala. Overall, the northern district of Kerala follows a higher growth pattern and southern districts follow the lower population growth rate.

Population Growth Rate of Kerala and India

census years Population growth rate of Kerala

Population Growth rate of India

1901-1911 1.11 5.75

1911-1921 0.88 0.31

1921-1931 1.98 11

1931-1941 1.49 14.22

1941-1951 2.06 13.31

1951-1961 2.21 21.64

1961-1971 2.33 24.8

1971-1981 1.76 24.66

1981-1991 1.34 23.87

1991-2001 0.91 21.54

2001-2011 0.82 17.64

1901-1911

1911-1921

1921-1931

1931-1941

1941-1951

1951-1961

1961-1971

1971-1981

1981-1991

1991-2001

2001-20110

0.5

1

1.5

2

2.5

0

5

10

15

20

25

30

Comparison of Population Growth Rate of Kerala and India

Population growth rate of KeralaPopulation Growth rate of India

Sex Ratio India & Kerala (1901 to 2001)

Kerala underwent a dramatic demographic transition in the last century and it has been inching towards zero population growth. The family planning programme, which the country took up in 1952, has been a roaring success in the state. And the high literacy rate and sharp fall in the infant mortality rate, brought about by improvement in public health standards, helped the people to restrict family size with a view to impart children better education and ensuring that they could lead better lives in the future.

Year.Sex RatioIndia Kerala

1901 972 10041911 964 10081921 955 10111931 945 10271951 946 10281961 941 10221971 930 10161981 934 10321991 927 10362001 933 1058

Nonetheless, sex ratio in the state has been steadily increasing from 1004 in 1901 to 1058 in 2001. This is in sharp contrast to India's933 females per 1000 males in 2001. Further, the overall sex ratio is favourable to females in all the districts in Kerala except Idukki (999) and Wayanad (1000). Idukki district had more male populace and in Wayand the female-male ratio is the same. Highest sex ratio falls in the Pathanamthitta district with 1094 females per 1000 males.

Thus the demographic history’ of India during the twentieth century can be charted and classified into following four distinct phases.

1.Period of Stagnant Population (1901-1921)

2. Period of Steady Growth (1921-1951)

3. Period of Rapid High Growth (1951-1981)

4. Period of High Growth with Definite Signs of Slowing Down (1981-2001)

EDUCATION IN KERALA

The educational scenario in Kerala is far advanced than other states of India. The Kerala model of development owes it attributed success to the achievements in the area of education and health. Most of the changes and development in the field of education has occurred since independence. The State had pursued a liberal higher education policy from 1956 through mid eighties in terms of quantitative expansion and access to higher education. Today, it boasts other states in terms of high literacy rate of 90.86% as against 65.38% in the national level.

Schools and colleges in Kerala are run either by the government, private trusts and individuals. The schools in Kerala are affiliated to Indian Certificate of Secondary Education (ICSE), the Central Board for Secondary Education (CBSE) and the Kerala State Education Board. The

Education Department of the state gives special attention to the primary education. The primary schools in Kerala include private aided, private unaided and government schools. Though both English and Malayalam are offered as medium of instructions by the state run schools, most of the private schools resort to English as their language of teaching. After completing the secondary education that involves 10 years of schooling, students usually enroll in higher secondary education in any one of the three disciplines - Science, Commerce and Humanities. Apart from this there are teacher training institutes, special schools for the differently abled persons and an Anglo Indian High School.

The excellent education system of Kerala attracts students from other nations. The progress in the number of educational institutions in the state is rapid. Presently (2006-07), there are 12644 schools constituting 2790 high schools, 3037 upper primary schools and 6817 lower primary schools respectively. While analyzing the distribution of schools it may be noted that the number of lower primary schools had decreased from 6861 (1980) to 6817 (2006-07). This is due to change in the demographic pattern and the fall in the fertility rate of the state. The private unaided schools are more prevalent in high schools, where they constitute 13.12% of the total high schools in the state. However, there is a sharp increase in the private aided schools in Kerala in all the 3 sections. Its distribution, in the year 2006-2007 was 1428 private aided high schools, 1870 private aided upper primary schools and 3992 private aided lower primary schools.

The enrolment of students showed a sharp decline over the years due to the steep fall in the rate of growth of population since late 1970s. A decline of 1.97% has been recorded in the enrolments of students in 2007-08 as compared to 2006-07. Enrolment of students in lower primary, upper primary and high schools sections are 31.14%, 31.76% and 31.10% respectively. The drop out ratio is very low in Kerala and it recorded 0.59% a lower primary level, 0.52% at upper primary level and 1.29% at high school level. Wayanad district has the highest deep out ratio (1065%) and Kasargode topped in the upper primary and high schools in this aspect.

The Technical Education system in the State includes courses in Engineering Technology, Management, and Architecture etc. at diploma, degree, postgraduate and research levels. Engineering colleges, Technical High Schools, College of Fine Arts, Polytechnic college, Government Commercial Institute, Government of Tailoring and garment making centre and industrial schools come under the purview of Technical Education System of the state. National Institute of Technology, Kozhikode having the Deemed University status offers graduate and post graduate courses. Cochin University of science and Technology (CUSAT) is short listed by MHRD, Government of India for up gradation to the status of IIEST. Self-financing institutions are also functioning in Technical Education sector in the state.

Kerala has pursued a liberal higher education policy from the independence.

Number of schools: -(2006-07, Govt. of Kerala)

High Schools- 2790

Upper Primary Schools- 3037

Lower Primary Schools- 6817.

Enrollment of students has shown a sharp decline over the years due to the steep fall in the rate of growth of population since late 1970s.

In case of teachers, there are 1,76,126 teachers and women dominate men in this profession by 7.4%.

Education accounts for more than one third of the total revenue expenditure of the state.

Role of Government:

Over all, the role of government in college education was limited as the number of colleges under government is only 38 out 224. Whereas, the dominance of the private sector has gone up with 66 per cent of the colleges being run by private management, and by and large they are aided colleges. Besides, there has been a significant growth in self-financing or private unaided colleges with the number increasing to 38, which equals the number of government colleges in the state. The reasons for the spread of unaided courses in aided colleges are many. The most important factor is the policy of the State Government. The de-linking of pre-degree courses from the colleges from 1997 onwards created large idle infrastructure in the private-aided colleges. Moreover, the off-campus programme of universities offered the best opportunity for private college managements to exploit the existing assets of the aided colleges to further their commercial interests. As such Kerala's higher education system has not expanded as much as one expects in a State where elementary education is nearly universal.

Role of government in college education was limited as number of colleges under govt. is only 38 out of 224. (06-07 GOK)

Government interventions:

District Primary Education Programme, 1994.

Sarva Shiksha Abhiyan,2001.

Higher Secondary centralized Allotment Process,2007.

Kalakshethra- Training to talented but financially backward students.

Merit Cum Means Scholarship- Scholarship for higher secondary education for the BPL students.

Literacy

Kerala with its rich culture of respecting womanhood had given due value to her rights and needs boosting her self esteem. In spite of its varied traditions, all have offered more scope and place for women than they experienced elsewhere in India.

 

While reviewing the history of Kerala, we could see her transformation into the forefront of the society as gradual but a cautious one. Yet, she was not aloof from the errands of rearing children and household chores. Still, she seems pleasing and gratifying the needs of the family and maintains an inimitable status of her own apart from the counterparts and women of other states. We pride ourselves on being the state with the highest literacy rate among women, a state where female to male ratio is higher, suggesting that there are fewer numbers of selective abortion or female infanticide. The Kerala evidence suggests that literate men have literate sons, but literate women have literate families.

POVERTY IN KERALA

Poverty Line for 2011-12 (Monthly per capita Rs.)

Rural Urban

Kerala 1,108 987

India 816 1,000

Population Below Poverty Line 2011-12

Rural Urban Total

%age of Persons

No of Persons(lakhs)

%age of Persons

No. of Persons (lakhs)

%age of Persons

No. of Persons (lakhs)

Kerala

9.14 15.48 4.97 8.46 7.05 23.95

India 25.7 2166.58 13.7 531.25 21.92 2697.83

KERALA’S POVERTY INDEX

Survey for assessing the urban poor, Every 2 years, Non economic factors, Nine risk factors

POVERTY ALLEVIATION

Government funded social welfare schemes, Kudumbashree – Women oriented poverty alleviation

Sectoral bifurcation of Kerala

Agriculture: The economy of Kerala is hugely dependent on its agriculture. The distinction of the agricultural sector of the economy can be noted from the fact that 96% of India's entire yield of pepper and 91% of natural rubber is produced in Kerala. Other important crops in the region are coconut, tea, coffee, cashew, and spices such as cardamom, vanilla, cinnamon, and nutmeg. Rice is the staple food of the natives and is grown in abundance in the state. Home gardening is a common activity in Kerala and the citizens contribute significantly to the economy by indulging in this pleasurable pursuit.

Livestock: Livestock and animal husbandry is an equally important facet of Kerala's economy. It has been suggested as an apt occupation for the rural populace and as the remedy for unemployed women and the economically weaker classes such as the landless. Almost 58% of Malayalis

households (38 lakhs of the 55 lakh households) are engaged in managing livestock and such activities such as Feeding, milking, cattle breeding, livestock management, health care and allied endeavors. The government of Kerala promotes livestock and cattle rearing by offering lucrative incentives to those engaged in the profession and holds educational programs. The introduction of new breeds of cattle such as "Sunandini" is also an encouraging factor.

Rainfall: The pre monsoon rainfall received in the State from 1st March 2013 to 31st May 2013 was normal with a departure of -42 per cent from the normal. The actual rainfall received during the period was 218.9 mm. All the Districts except Kottayam and Wayanad recorded deficient rainfall. The percentage departure from normal was highest in Palakkad (-56per cent), Malappuram( -56 per cent) and Thrissur ( -56 per cent ) Districts.

South West monsoon current advanced over the Andaman Sea 3 days earlier than its normal date of 20th May and set in over Kerala on its normal date of 1st June. The South West monsoon covered the entire country by 16th June, about 1 month earlier than its normal date of 15th July. Out of the total 36 meteorological subdivisions, 14 subdivisions constituting 48 per cent of the total area of the country received excess season rainfall, 16 subdivisions (38 per cent of the total area of the country) received normal season rainfall and the remaining 6 subdivisions (14 per cent of the total area of the country) received deficient season rainfall.Out of the total of 641 districts, 100 were affected by moderate meteorological drought (seasonal rainfall deficiency of 26 per cent to 50 per cent), while 39 were affected by severe meteorological drought (seasonal rainfall deficiency of 51 per cent to 99 per cent).

Fisheries: Fisheries contribute about 3% to the total economy of the state. The natural landforms of the state endow Kerala with a huge output of marine and freshwater fish haul each year. About 10.85 lakh people earn their livelihood from fishing and allied activities such as drying,

processing, packaging, exporting and transporting fisheries. The well being of these fishermen and workers depends on the proper implementation of the various schemes devised by the Department of Fisheries. The government of Kerala is enforcing every measure possible in their interest. The state alone yields 6.75 lakh tonnes of fish every year. Marine fish landings of India during the year 2012 has provisionally been estimated as 3.32 million tones with a decrease of about 0.05 million tonnes compared to the estimate for the last year. Among the states Gujarat was the highest contributor of Marine fish production followed by Kerala. In total fish production Andhra Pradesh was the highest contributor and Kerala stands 4th position. During 2012-13, 5.31 lakh tonnes of marine fish were landed in Kerala showing a decline of 0.22 lakh tonnes (4.14 per cent) over the previous year. The high value species among the fish catches are still few, prominent among them are Seer fish, Prawn, Ribbon fish and Mackerel. The quality of these high value species in the total catch ultimately decides the income of the fishermen.

Forestry & Wildlife: About 10,336 sq.km of Kerala is densely forested. This constitutes 26.6% of the total geographic land. A huge spectrum of flora and fauna has its home in this verdant state. Thus forestry and wildlife plays a major role in the state's economy. The revenue earned from export of herbs and herbal byproducts such as oils, hides of animals such as the jaguar, fox, elephant etc., tree barks, natural incense, scents, ivory, sandalwood, teakwood, rosewood etc contribute as a major foreign exchange earner. A number of indigenous industries have also mushroomed owing to this phenomenon. These include leather product manufacturing units, fragrance and incense preparing cottage industry, sandal and ivory carving business and coir product manufacturing units. The forest cover of the Kerala State as per the 2011 report of FSI was 17300 sq.km. with 1442 sq.km of very dense forest, 9394 sq.km of moderate dense forest and 6464 sq.km of open forest. This constitute 44.5 per cent of the total geographical area of the State, shows that the forest cover of Kerala increased over previous assessment. There is an increase

of very dense forest cover to the tune of 419 sq.km, moderate forest of 774 sq.km and open forest 536 sq.km.

As per FSI, the main reason for forest cover increase was due to the change in the area of the trees outside forests.In Kerala, Idukki District has the maximum forest cover of 3930 sq.km and Alappuha District has the lowest forest cover of 38 sq.km. In terms of per centage of forest cover with total geographical area, Wayanad has the highest forest cover of 83.3 per cent, followed by Idukki and Pathanamthitta.

The estimated forest area (provisional) in Kerala is 11309.475 sq.km. This includes 9107.206 sq.km of reserve forest, 364.473 sq.km of proposed reserves and 1837.796 sq.km of vested forests. The total forest cover of the country as per India State of Forest Report 2011 is 78.29 million ha.which constitute 23.81 per cent of the geographical area of the country. In comparison to the 2009 assessment, there is a decrease of 367 sq.km. in country’s forest cover. 15 states have registered aggregate increase of 5000 sq.km. in their forest cover with Punjab leading with increase of 100 sq.km. 12 States mainly in (Northern Eastern States) have shown decreased the extent of 867 sq.km. Decline of 281 sq.km. in forest cover of Andra Pradesh is mainly attributed to cutting the Eucalyptus and other species. The state of Madhyapradesh has the largest forest cover in the country at 77700 sq.km. followed by Arunachal Pradesh at 67410 sq.km. As per the 2011 assessment, forest cover of Kerala is 17300 sq.km.

Industry & infrastructure: A number of industries in Kerala are booming and flourishing. The textile and electronics industry in Kerala is on an all time high. Coffee, tea, cardamom, ginger, pepper coconut kernels form the bulk of the exports from the state. Kerala has about 1.8 lakh small scale industries and about 511 medium sized and large scale industries. The roads of the state too are in excellent metaled condition. The state boasts of having 145,704 km of roads and 8 national highways. Traffic in the state grows at 11% annually. Industry has been performing sub-optimally in the country in recent times. During April- October, 2013, at the All India level, there was negative growth of 2.7 per cent and 0.3 per

cent in Mining and Manufacturing over the same period in the previous year. Only the electricity sector showed a growth of 5.3 per cent in this period. Taken together, Industry (mining, manufacturing and electricity) remained stagnant. Negative growth was observed in Food products, Wood products, Rubber and Plastics Products, Basic metals and various machinery items. Capital goods industry showed a negative growth of 0.2 per cent in April- October 2013. This dismal performance of industry, due to a variety of reasons including low business expectations and high interest rates, has critical implications on Kerala, which is dependent on the supply of industrial inputs, intermediary goods and final consumption goods from the rest of the country. Any supply bottlenecks can push up input as well as output prices. Further, Kerala’s own industry, especially export oriented industry will also be dampened if industry in the rest of the country (and world) is stagnant, as there will be less demand for Kerala’s goods. This chapter brings out critical issues relating to State Public sector Industries, Micro, small and medium industries and traditional industries. Critical issues on labour and employment are brought out to show Kerala’s unique achievements on the labour front and concerns on the employment front.

In Kerala the manufacturing sector registered a growth rate of 12.4 per cent at current prices during 2012-13 compared to the growth rate of 15.4 per cent in the previous year. The contribution of income from manufacturing sector to GSDP at constant and current prices during 2012-13 was 7.7per cent and 7.6 per cent respectively. The percentage contribution of Manufacturing sector to GSDP from 2007-08 to 2013-14 did not show a definite trend. A drastic decline can be observed during 2009-10 and after that there was an increase, which again declined during 2011-12.

Minerals & Energy: A high output of hydel power had held Kerala in good stead till recently. The steady increase in industries and an inability to undertake more hydel energy generating projects has forced the state to look towards diesel energy and thermal energy import. Kerala is the

second largest diesel-based thermal electricity generator in India. The state's national market share is over 21%. The state is rich in its mineral ores as well. The finest variety of China Clay in India is available here. Bauxite, quartz, silica etc are some minerals available freely in the state. Kerala is blessed with a bounty of mineral wealth.

Mineral Based Industries in Kerala

Indian Rare Earths Ltd., Chavara

Kerala Minerals and Metals Ltd., Chavara

Malabar Cements, Walayar

Travancore Cements Ltd., Kottayam

Kundara Ceramics, Kollam

English Indian Clays Ltd. (EICL), Thiruvananthapuram

Excel Glass Industry, Alappuzha

Kerala Clays and Ceramic Products Ltd., Pazhayangadi, Kannur

Power Sector in Kerala

In Kerala, shortage of power is the prime obstacle in starting new initiatives in the industrial field. The need for power is increasing and the production of power should also be increased accordingly. Monsoon is essential to sustain the hydropower base in the state and the shortage in rainfall usually creates power crisis. Hydel energy is the most reliable and dependable source in Kerala. Of the total installed capacity of 2881 MW during 2012-13, hydel contributed the major share of 2053 MW (71%); while 793MW was contributed by thermal projects including NTPC at Kayamkulam (Kerala’s dedicated thermal station) and Kanjikode wind farm, Palakkad has contributed 2MW. Wind Energy from IPP is 33 MW. Additional capacity generated during 2012-13 was only 8 MW (0.28%) that is 2881 MW in 2012-13 against 2873 MW in 2011-12. 

Migration

Migrant Labour

The migration of workers for employment is a process prevalent from time immemorial. The migration of workers from the state to other states and abroad was a phenomenon existed in the state from very earlier. However the recent trend in the employment sector in the state is the large inflow of migrant workers from other state such as West Bengal, Bihar, Odisha, Uttar Pradesh, Chhattisgarh, Jharkhand etc. besides the neighbouring state.

The migrant workers from poorer states are in demand in levels wages demanded by them. Working conditions of the inter-state migrant workmen are dealt with the Inter State Migrant Workmen Regulation of Employment and Conditions of Service Act,1979. As per the provision of the Act the contractor have to obtain a recruitment license from the state from where the workers are recruited (Original State) and an employment license from the state where they are employed (Recipient State).

Accordingly the contractor and the principal employer become liable for ensuring the provisions envisaged in the enactment as an immediate employer and the principal employer respectively. But usually these workers cannot be brought under the purview of the enactment due to lack of statutory ingredients required to attract the ambit of the enactment such as an intermediary third party/contractor between the Principal employer and the workmen. These workers are compelled to live in groups and unhygienic circumstances near to their working place without proper health facilities. There are more than 25 lakh migrant workers are employed in various employment sectors in the state.

Banking & Finance: Kerala has its share of banking and financial institutions. Besides the PSUs, a number of leading private banks such as HDFC Bank, ICICI Bank, ABN Amro Bank etc. have set up a network of retail branches and ATMs for the residents of the state. Besides traditional products these offer a plethora of financial services especially NRI services

owing to the extent of Malayali Diaspora. Mutual funds, financial lending institutions and other such services are easily available in the state.

Kerala Tourism: Tourism in Kerala is the livelihood of over 7 lakh people and generates revenue of about 4000 crore rupees (Rs. 40,000 million). Kerala remained till a decade back, a sheltered, secluded pristine haunt and was popular as a tourist destination only to the country. This well guarded secret was let out in the mid 90's when the Government of Kerala and the Department of Tourism actively started promoting the region as a cherished tourist destination. The influx of global backpackers into the state has been ever increasing and the allied businesses involved such as hotels and accommodation and transport etc have also flourished.

Kerala Real Estate: The real estate sector of the state's economy is really on an upswing. Increase in population and increased access to home finances has increased the demand for constructing houses. While various institutions such as The Kerala State Housing Board, Rural Development Department, Kerala State Co-operative Housing Federation, Agricultural Bank and Kerala State Development Corporation are busy implementing the various housing schemes devised by the Government of Kerala, various mushrooming PSU and other financial institutions are wooing the people of Kerala with funds and financial aid towards housing and home building.

Health Care: The medical profession and the healthcare industry in Kerala is growing in leaps and bounds. Dentistry, cardiac sciences, oncology, ophthalmology, nursing and biotechnology are major growth fields. With the growth of medical education, there has been a spectacular increase in the number of hospitals and diagnostic centers in the state. Medical tourism to the state is a major revenue earner. Tourists especially from the Gulf and Middle East where the costs of surgical procedures, post operative care and pharmaceutical drugs are very high.

IT Sector: With the boom in the IT sector of Kerala, the state has become one of the most promising destinations in the entire continent for software development, e-commerce and e-business solutions. The rise in the number of professionals employed in this sector has steeply risen following the active promotion of educational institutions offering courses such as MCA, Bsc (Comp), Software Engineering etc. This is a direct result of the Government of Kerala's active IT Mission which aims at creating about 2 lakh vacancies in the sector by 2010. With the rising investments of multinationals and the creation of Techno Park this sector is a major revenue generator in the state.

Kerala model of development- An analysis

What do we understand of the term ‘Development’? Does it mean having more money or wealth? Does it mean owning expensive smart phones with luxurious bikes? Does it mean living in town or cities? The answer to these entire questions is simply ‘No’. Life has no meaning if we have bad health, if our life is short, if our babies doesn’t cross the age of 1, if we are not educated, more importantly if we are not aware of our rights as human beings and if we don’t live with dignity and die with dignity. Development is more of having ‘good quality of life’ rather than having more and more money.But what is meant by ‘good quality of life’?

The indicator of good quality of life include; Life expectancy, IMR, MMR, Literacy, Health amongst others. All these indicators gave Kerala the world recognition.For instance, The UN in 1991 certified Kerala as 100% literate.The UNICEF and WHO chose Kerala as the first state to become a ‘baby friendly state’. But how did Kerala achieved this? Well, this is a long story. The economists called this ‘Kerala Model’. Kerala Model,per se is not a separate entity but what has been labelled is the experience of Kerala as a result of its development indicator being on par with those of the developed or say the first world countries.

The journeyThe Kerala Model is a systematic and a well planned investment in Education and Health even before the birth of the state. This can be traced back to the rulers of the erstwhile Princely state of Travancore. The rulers were in the fore front in the campaign for education and spreading its awareness. The Maharaja established a school for girls in 1859 which was unprecedented act in the Indian Subcontinent. The great fares of Kerala in education truly demanded the mention of the Christian Missionaries right from the first half of the 19th century. The Churches were instructed to start ‘Pallikkoodam’ Malayalam word for School, along with every Parish Churches in the early part of the 1860s when the CMS missionary reached Kerala. This historic effort has been delivered and cherished effectively due to the participative and responsive citizens of the state over the generations. This has led to the growth of western education.The democratically elected Communist government which broke the backbone of the feudal system by introducing land reform has also count a lot. The government spent heavily on public health care and education. The social reformers who fought against the caste barrier and equal share for all sections of the society in public facilities and temple entering also played a vital role in shaping the society. Thus, the state of affairs of education in Kerala can be credited to the social reformers who were far ahead of their times. This gave Kerala a high advantages and a better start post independent compare to the rest of the country. For example, at the time of independent, Kerala literacy was 47% against the 18% for all India.

The idea of developmentAmartya Sen, the Nobel laureate and Professor of Economics and Philosophy at Harvard University many a times heralded in his speech about the Kerala model. He mentioned, in verbatim, “India doesn’t need to look elsewhere for development pointers. There is much that India can learn from Kerala’s development experience. Kerala, despites of its low income has achieved more than even some of the most admired high growth economies. Its achievement is remarkable”. However his promotions of Kerala’s experience as a model for development draws flaks

from a Columbia University Professor JagdishBhagwati and Arvind Panagariya for advocating the Kerala Model rather than its counterpart Gujarat Model. What then is Gujarat Model? Here lies apertinent point to note, a startling expression. Kerala Model, as a whole, is not a model of governance rather it is a model of self-help or the so called ‘public action mode’. Well, I’m not getting in to the debate but read between the lines. The Gujarat model is of entrepreneur, investment, commercial, infrastructure and business oriented which I would called it as a protagonist of the concept of Managerial view in the sphere of Public Administration, as a vocation, in being its principle of ‘just getting things done’. In contrast, its counterpart Kerala, as mentioned above, is more of Direct action- a reformist’s action, civil society action or a result of people’s movement, I called thisa protagonist of the concept of Integral view in being ‘doing things and not just getting things done’. Amartya Sen attribute the state-led welfare as the reason for Kerala’s high development indicator while Bhagwati and Panagariya credited its success to private enterprises and globalisation. While the Gujarat Model is famous for its business friendliness, its increasing agri-GDP growth rate, its attraction as investment destination and its economic freedom-which is the critical condition for good governance, it doesn’t sail well with its abysmal development indicators. Let’s have a closer look. The updated version of the HDI 2011 reports which was released on March 2014 presented the percentage change in HDI between 1999-00 to 2011-12 for all states in India in view of new facts and data on income, education and health. As per the reports, states which have low HDI such as Chhattisgarh, Orissa, Bihar and Assam registered a much better improvement than several of the progressive states that includes Gujarat. In education sector, as many as 17 states out of the 22 states performed better than Gujarat.

In 1970

The economists noted that despite low incomes, the state had high literacy rates, healthy citizens, and a politically active population. Researchers began to delve more deeply into what was going in the Kerala Model, since

human development indexes seemed to show a standard of living which was comparable with life in developed nations, on a fraction of the income. The development standard in Kerala is comparable to that of many first world nations, and is widely considered to be the highest in India at that time.

Despite having high standards of human development, the Kerala Model ranks low in terms of industrial and economic development. The high rate of education in the region has resulted in a brain drain, with many citizens migrating to other parts of the world for employment. The job market in Kerala is forcing many to relocate to other places.

Human Development Index

In 1990

From 1990 onwards, the United Nations came with the Human Development Index (HDI). This is a composite statistic used to rank countries by level of "human development" and separate developed (high development), developing (middle development), and underdeveloped (low development) countries. The statistic is composed from data on Life Expectancy, Education and per-capita GDP (as an indicator of Standard of living) collected at the national level using a formula. This index, which has become one of the most influential and widely used indices to compare human development across countries, give Kerala Model an international recognition. The HDI has been used since 1990 by the United Nations Development Programme for its annual Human Development Reports. From the starting of this index, Kerala has scored high, comparable to developed countries.

In 2011

The India Human Development Report, 2011 prepared by Institute of Applied Manpower Research, placed Kerala on top of the index for achieving highest literacy rate, quality health services and consumption expenditure of people.

Health care

Calicut Medical College in Kozhikode. Kerala has around 2,700 government medical institutions in the state, with 330 beds per 100,000 population, the highest in the country.

The basis for the state's impressive health standards is the statewide infrastructure of primary health centres. There are over 2,700 government medical institutions in the state, with 330 beds per 100,000 population, the highest in the country.With virtually all mothers taught to breast-feed, and a state-supported nutrition programme for pregnant and new mothers, infant mortality in 2011 was 12 per thousand, compared with 91 for low-income countries generally.[7][8] In Kerala the birth rate is 40 per cent below that of the national average and almost 60 per cent below the rate for poor countries in general. In fact, a 1992 survey found that the birth rate had fallen to replacement level.Kerala's birth rate is 14 per 1,000 females and falling fast. India's rate is 25 per 1,000 females and that of the U.S. is 16. Its adult literacy rate is 94.59 per cent compared to India's 65 and the US's 99. Life expectancy at birth in Kerala is 75 years compared to 64 years in India and 77 years in the US. Female life expectancy in Kerala exceeds that of the male, just as it does in the developed world.Kerala's maternal mortality rate is :Total: 1.3 deaths/1,000 live births (1990), lowest in India.

According to a white paper on the Quality of Death, released by the Economist Intelligence Unit in 2010, has projected the community model healthcare system from Kerala as a beacon of hope for providing palliative care services. The report from 'The Economist' has ranked 40 countries across the world on end-of-life care facilities on the basis of 24 indicators on healthcare environment and availability, cost and quality of care. In the overall score, India with a score of 1.9 out of 10 ranked the 40th, behind countries such as Slovakia, Malaysia, Turkey, Brazil and even Uganda. UK topped the list followed by Australia and New Zealand

While India ranks at the bottom of the Index in overall score, and performs badly on many indicators, Kerala, if measured on the same points, would buck the trend. With only 3% of India's population, the tiny

state provides two-thirds of India's palliative care services. The Economist has lauded the 'Kerala Community Model' in healthcare. Moreover, The Economist has patted the Kerala Government for providing palliative care policy (It is the only Indian state with such a policy) and funding for community-based care programmes. Kerala had pioneered Universal health care through extensive public health services.Hans Rosling also highlighted this when he said Kerala matches United States in health but not in economy and took the example of the state of Washington which is much richer but is less healthy compared to Kerala.

The magazine said that Kerala is one of the first of India's states to relax narcotics regulations to permit use of morphine by palliative care providers. Kerala has also extended the definition of palliative care to include the long-term chronically ill and even the mentally incapacitated. Kerala's formal palliative care policy, the only state with such a policy, the community-based Neighborhood Network in Palliative Care (NNPC) Project that employs an army of volunteers and the Government funding for these local community-based care units, almost 260 in number, has earned it many an accolade.

The report said twenty nine out of the 40 countries studied have no formal palliative care strategy, revealed the report. Only seven – Australia, Mexico, New Zealand, Poland, Switzerland, Turkey and UK – have national policies, while four others – Austria, Canada, Ireland and Italy – are in the process of drafting one. Kerala had long ago recognised the importance of palliative care as can be seen from the growth of community-based care units. "The State's community-operated care system is funded largely through local micro-donations of as little as Rs 10 (21 US cents) per month. The volunteers in these units, after training can provide psychological, social and spiritual support. It is this that marks the NNPC out from more medical-oriented and expensive systems in use elsewhere," said the report.

Studying Kerala's combination of Government support and civic involvement in end-of-life care, a number of similar models are being tried out in Ethiopia, Bangladesh, Seychelles and even in Switzerland. "Kerala provides a useful lesson for other countries, particularly as ageing

population puts increasing pressures on existing healthcare services," said the report. While countries such as Taiwan and Hungary have managed to get on the top 15 of the index, one possible reason cited for the poor show by India and China is their large population, with the care coverage reaching only a fraction of those in need.

Political awareness

Political awareness among the common people including children is quite high, thanks to its history of Social Reformers like Sree Narayana Guru, Shree Chattambi Swamigal, Ayyankali etc., Leftist Movements and the unique political situation that exists in Kerala. Political history in Kerala shows a trend of an alternating elected Right wing and Left government, which results in an increase in public welfare activities, much to the benefit of the common man. In each town square, political parties maintain their icons – a statue of Indira Gandhi or a portrait of Marx, Engels, and Lenin in careful profile. Strikes, agitations, and stirs, a sort of wildcat job action, are so common as to be almost unnoticeable. Anthropologist Bill McKibben says "Though Kerala is mostly a land of paddy-covered plains, statistically Kerala stands out as the Mount Everest of social development; there's truly no place like it."

Education

The Pallikkoodam, a school model started by Syro Malabar Christian social reformer Saint Kuriakose Elias Chavara, paved the way for an educational revolution in Kerala by making education accessible to all, irrespective of caste or religion. Christian missionaries introduced Western education methods to Kerala. Communities such as Ezhavas, Nairs and Dalits were guided by monastic orders (called ashrams) and Hindu saints and social reformers such as Sree Narayana Guru, Sree Chattampi Swamikal and Ayyankali, who exhorted them to educate themselves by starting their own schools. That resulted in numerous Sree Narayana schools and colleges, Nair Service Society schools. The teachings of these saints have also empowered the poor and backward classes to organize themselves and bargain for their rights. The Muslim Educational Society (MES) also made significant contributions to education. The

Government of Kerala instituted the Aided School system to help schools with operating expenses such as salaries for running these schools.

Kerala had been a notable centre of Vedic learning, having produced one of the most influential Hindu philosophers, Adi Shankaracharya. The Vedic learning of the Nambudiris is an unaltered tradition that still holds today, and is unique for its orthodoxy, unknown to other Indian communities. However, in feudal Kerala, though only the Nambudiris received an education in Vedas, other castes as well as women were open to receive education in Sanskrit, mathematics and astronomy, in contrast to other parts of India.

The upper castes, such as Nairs, Tamil Brahmin migrants, Ambalavasis, as well as backward castes such as Ezhavas had a strong history of Sanskrit learning. In fact many Ayurvedic Physicians (such as Itty Achudan) were from the backward Ezhava community. This level of learning by non-Brahmin learning was not seen in other parts of India. Also, Kerala had been the site of the notable Kerala School which pioneered principles of mathematics and logic, and cemented Kerala's status as a place of learning.The prevalence of education was not only restricted to males. In pre-colonial Kerala, women, especially those belonging to the matrilineal Nair caste, received an education in Sanskrit and other sciences, as well as Kalaripayattu, a martial art. This was unique to Kerala, but was facilitated by the inherent equality shown by Kerala society to females and males, since Kerala society was largely matrilineal, as opposed to the rigid patriarchy in other parts of India which led to a loss of women's rights.

The rulers of the princely state of Travancore (were at the forefront in the spread of education. A school for girls was established by the Maharaja in 1859, which was an act unprecedented in the Indian subcontinent. In colonial times, Kerala exhibited little defiance against the British Raj. However, they had mass protests for social causes such as rights for "untouchables" and education for all. Popular protest to hold public officials accountable is a vital part of life in Kerala.In the 1860s, the government of India spread the educational programs into Malabar, the northern state that had been ruled directly by the British, and began granting scholarships to Dalits and tribal peoples. By 1981, the general

literacy rate in Kerala was 70 per cent – almost twice the all-India rate of 36 per cent. The rural literacy rate was almost identical, and female literacy, at 66 per cent, was not far behind. The government continued to press the issue, aiming for "total literacy," usually defined as about 95 per cent of the people being able to read and write.

A pilot project began in the Ernakulam region, an area of 3 million people that includes the city of Kochi. In late 1988, 50,000 volunteers fanned out around the district, tracking down 175,000 illiterates between the ages of 5 and 60, two-thirds of them women. Within a year, it was hoped, the illiterates would read Malayalam at 30 words a minute, copy a text at 7 words a minute, count and write from 1 to 100, and add and subtract three-digit numbers. On 4 February 1990, 13 months after the initial canvass, Indian Prime Minister V. P. Singh marked the start of World Literacy Year with a trip to Ernakulam, declaring it the country's first totally literate district. In 2001, Kerala's literacy rate was 91% almost as high as that of China (93%) and Thailand (93.9%).

State Policy

In 1957 Kerala elected a communist government headed by EMS Namboothiripad, introduced the revolutionary Land Reform Ordinance. The Land reform was implemented by the subsequent government, which had abolished tenancy, benefiting 1.5 million poor households. This achievement was the result of decades of struggle by Kerala's peasant associations. In 1967 in his second term as Chief Minister, Namboothiripad again pushed for reform. The land reform initiative abolished tenancy and landlord exploitation; effective public food distribution that provides subsidised rice to low-income households; protective laws for agricultural workers; pensions for retired agricultural laborers; and a high rate of government employment for members of formerly low-caste communities.

Hunger

According to the India State Hunger Index, Kerala is one of the four states where hunger is only "serious". Hunger index score of Kerala is 17.66 and is next only to Punjab. Nation hunger index of India is 23.3