PMO forms executive panel on implementing the 8 missions of the NAPCC

A secretary level committee has been constituted by Prime Minister Manmohan Singh to assist the PM’s council on climate change in implementing the 8 missions of the National Action Plan of Climate Change (NAPCC).
The absence of Inter-ministerial coordination has crippled the implementation of the missions resulting in the setting up of the executive panel on climate change to be headed by principal secretary to Prime Minister Pulok Chatterji.

What is the job of the panel:
The committee will regularly monitor the implementation of the eight missions, other climate change initiatives and advise the Prime Minister’s council on modifications in the objectives, strategies and structure of the missions.
The Prime Minister’s council on climate change was formed in 2007, in order to co-ordinate national action for assessment, adaptation and mitigation of climate change.

What is NAPCC and what are its 8 missions:

 NAPCC is a comprehensive action plan which outlines measures on climate change related adaptation and mitigation while simultaneously advancing development. The 8 Missions form the core of the Plan, representing multi-pronged, long termed and integrated strategies for achieving goals in the context of climate change. The Eight Missions are:

I. National Solar Mission
Objective:

• Make solar energy competitive with fossil-based energy options.
• Launch an R&D programme facilitating international co-operation to enable the creation of affordable, more convenient solar energy systems.
• Promote innovations for sustained, long-term storage and use of solar power.

II. National Mission for Enhanced Energy Efficiency

• The Energy Conservation Act of 2001 provides a legal mandate for the implementation of energy efficiency measures through the mechanisms of The Bureau of Energy Efficiency (BEE) in the designated agencies in the country.
• A number of schemes and programmes have been initiated which aim to save about 10,000 MW by the end of the 11th Five-Year Plan in 2012.

III. National Mission on Sustainable Habitats
Objective:

• Make habitats sustainable through improvements in energy efficiency in buildings, management of solid waste and a modal shift to public transport.
• Promote energy efficiency as an integral component of urban planning and urban renewal through its initiatives.

IV. National Water Mission
Objective:

• Conserving water, minimizing wastage, and ensuring more equitable distribution and management of water resources.
• Optimizing water use efficiency by 20% by developing a framework of regulatory mechanisms.

V. National Mission for Sustaining the Himalayan Ecosystem
Objective:

• Empowering local communities especially Panchayats to play a greater role in managing ecological resources.
• Reaffirm the measures mentioned in the National Environment Policy, 2006.

VI. National Mission for a Green India
Objective:

• To increase ecosystem services including carbon sinks.
• To increase forest and tree cover in India to 33% from current 23%.

VII. National Mission for Sustainable Agriculture
Objective:

• Make Indian agriculture more resilient to climate change by identifying new varieties of crops (example: thermally resistant crops) and alternative cropping patterns.
• Make suggestions for safeguarding farmers from climate change like introducing new credit and insurance mechanisms and greater access to information.

VIII. National Mission on Strategic Knowledge on Climate Change
Objective:

• Work with the global community in research and technology development by collaboration through different mechanisms. It also has its own research agenda supported by climate change related institutions and a Climate Research Fund.
• Encourage initiatives from the private sector for developing innovative technologies for mitigation and adaptation.

Venezuela announces currency devaluation

Venezuela’s government has announced that is devaluing the country’s currency, a change expected to push up prices in the heavily import-reliant economy.
The fixed exchange rate is changing from 4.30 bolivars to the dollar to 6.30 bolivars to the dollar.

The devaluation had been widely expected by analysts in recent months.

It was the first devaluation to be announced by President Hugo Chavez’s government since 2010.

Planning and Finance Minister Jorge Giordani said the new rate takes effect immediately, though the old rate would still be allowed for some transactions that already were approved by the state currency agency.

Venezuela’s government has had strict currency exchange controls since 2003 and maintains a fixed, government-set exchange rate.

Under the currency controls, people and businesses must apply to a government currency agency to receive dollars at the official rate to import goods, pay for travel or cover other obligations.

While those controls have restricted the amounts of dollars available at the official rate, an illegal black market has also flourished and the value of the bolivar has recently been eroding.

In black market trading, dollars have recently been selling for more than four times the official exchange rate of 4.30 bolivars to the dollar.

MCX-SX to begin trading in equities, equity derivatives

MCX Stock Exchange (MCX-SX) will begin trading in equities and equity derivatives from February 11.

With its 40-stock index named SX40, MCX-SX is the third full-fledged equity bourse after BSE and NSE. The bourse was formally launched by Finance Minister P. Chidambaram on Saturday.

Free-float based index:

SX40 will be a free-float based index of large-cap and liquid stocks, representing diverse sectors. The base value will be 10,000 with a base date of March 31, 2010, MCX-SX Vice-Chairman Jignesh Shah said during the launch.

The index is designed to measure the economic performance with better representation of various industries and sectors based on the ICB (industry classification benchmark), a global classification from the FTSE of the London bourse.

Globalization and International Business

Globalization is a process through which different economies of the world gradually lift up the restrictions, that hinders the free flow goods, services, resources etc. across various political boundaries.

This is done in particular through International Business (carries out mainly through International Trade and Investment), aided by sophisticated technologies and market integration.

International Business

International Business means carrying out businesses beyond national boundaries. The international business includes both International Trade as well as Foreign Direct Investment (FDI).

International Trade can broadly be divided into two parts viz. Export and Import.

• Export - The transaction of goods and services (via. sales, barter, gift or grant) from home country to the host country is called Export.
• Import - The transaction of goods and services (via. sales, barter, gift or grant) to home country from host country is called Import.

Foreign Direct Investment occurs when an investor based in one country (at home country) acquires an asset in another country (the host country) with intent to manage that asset. It is the management dimension that typically differentiates FDI from Portfolio Investment in foreign securities and financial instruments in foreign securities  and financial instruments.

In most cases both the investor and the asset it manages abroad are business entity. In such a case investor is typically referred to as 'parent firm' and the asset it manage is called 'affiliate' or 'subsidiary'.

Motive behind Foreign Direct Investment (FDI) includes:-

• Acquiring natural resources
• Recovery of large expenditure made on research and development
• Capturing a large International Market System
• Earning Large Profit
• Maintaining Balance of Payment

Importance of International Business

The importance of International Business can be studied at two levels:

Macro Level

1. No country (be it developed or developing) produces all the commodities to meet its requirement as such it needs to port those commodities that are either not produced or produced in insufficient quantity in domestically to meet its requirements.
2. At the same time all the countries tries to export all the commodities that are in excess of its domestic consumption.
3. Maintaining favorable balance of payment.

Micro Level

1. Maximization of corporate wealth
   Corporate wealth is the value of productive asset plus the present value of wealth created by those assets.
   Alternatively, corporate wealth quals to the sum of total of debt and equity of a firm.
2. Minimization of cost
   Acquiring the resources which are relatively cheaper helps reduce the cost of production.
3. Minimization of risk through
   (A) Diversification of business
   (B) Expansion of business

Approaches to International Business

• Ethnocentric- In this form of approach, the policies of a firm operating in foreign country are based upon that of home country.
• Polycentric- In this form of approach, the policies of a firm operating in foreign country are based upon that of host country in which it is operating.
• Geocentric- Between above two approaches, geocentric approach follows a real life situation, where there exist no distinction (or boundaries) of framing the policies in terms of either home or host country. This approach aims to fit the "right policy at right place".

REPORT ON POVERTY LINE IN THE URBAN AREAS

Planning Commission Annual Report 2011-2012 - English

India's per capita income rises to Rs 5,729 per month

India's per capita income, a gauge for measuring living standard, is estimated to have gone up 11.7 per cent to Rs 5,729 per month in 2012-13 at current prices, compared with Rs 5,130 in the previous fiscal.
The estimated rate of growth in per capita income for the current fiscal, however, is lower than the previous fiscal when it grew by 13.7 per cent.
"The per capita income at current prices during 2012-13 is estimated to be Rs 68,747 as compared to Rs 61,564 during 2011-12, showing a rise of 11.7 per cent," an official release by the Central Statistics Office (CSO) on Advance Estimate of National Income, 2012-13.
The per capita income in real terms (at 2004-05 constant prices) during 2012-13 is likely to attain a level of Rs 39,143 as compared to the First Revised Estimate for the year 2011-12 of Rs 38,037, it said.
The Gross Fixed Capital Formation (GFCF) at current prices is estimated at Rs 29.94 lakh crore in 2012-13 as against Rs 27.49 lakh crore in 2011-12, the release said.
However, at 2004-05 constant prices, the GFCF is estimated at Rs 19.44 lakh crore in the current fiscal as against Rs 18.97 lakh crore in the previous fiscal, it added. The data also estimated an increase of 13.8 per cent in the Government Final Consumption Expenditure (GFCE) to Rs 11.87 lakh crore at current prices for 2012-13 against Rs 10.43 lakh crore in 2011-12.
On Private Final Consumption Expenditure (PFCE) for the current fiscal, it has estimated an increase of 12.8 per cent to Rs 57.06 lakh crore at current prices as against Rs 50.56 lakh crore in the previous fiscal. "These advance estimates are based on anticipated level of agricultural and industrial production, analysis of budget estimates of government expenditure and performance of key sectors like railways, transport other than railways, communication, banking and insurance, availbale so far," said the data.

Rashtriya Bal Swasthya Karyakram launched in Thane, Maharashtra

UPA chairperson Sonia Gandhi on 6 February 2013 launched a new health initiative called Rashtriya Bal Sawsthya Karyakram at Palghar town in Thane district of Maharashtra. The Rashtriya Bal Swasthya Karyakram, is a part of the National Rural Health Mission of the Union Ministry of Health and Family Welfare.
The Main Features of Rashtriya Bal Swasthya Karyakram are as following:
• The Rashtriya Bal Swasthya Karyakram is aimed at improving overall quality of life of children through early detection of birth defects, diseases and deficiencies, which are among key factors for child mortality.
• The new initiative would assure a package of health services for all children up to 18 years of age. The programme will also prove economical for poor and marginalized.
• The services will be provided through dedicated mobile health teams placed in every block. The scheme, which will be implemented in a phased manner, is expected to benefit approximately 27 crore children across the country.

Birth defects account for 9.6 per cent of all new-born deaths and 4 per cent of under-five mortality. According to the programme, a set of thirty common conditions have been identified for screening and further management of child health.

National Rural Health Mission (NRHM) is an Indian health program for improving health care delivery across rural India. It was launched on 12 April 2005 for a period of 7 years.

CCEA gave its nod to Price Pooling Mechanism on Coal to Control Prices of Coal

The Cabinet Committee on Economic Affairs (CCEA) on 5 February 2013 gave its principle approval for the price pooling mechanism of coal. The mechanism includes cost blending of the domestic coal with the imported one to counterbalance price hike. Basic principles and parameters of the price pooling mechanism have been identified and a specific data on the same would be created by the Power and Coal Ministries.  

The mechanism has been created before government decided to put on sale the 9.5 percent stake of the National Thermal Power Corporation (NTPC) from its present holding of 84.50 percent. The sale of the stake was approved by the Empowered Group of Ministers on disinvestment chaired by Finance Minister P Chidambaram on 5 February 2013. This disinvestment of NTPC would fetch about 12000 crore rupees for the exchequer.

BHEL and GAIL Granted Maharatna Status by the Union Government of India

The Union Government of India gave the Maharatna status to two PSUs- BHEL and GAIL on 1 February 2013. Granting Maharatna status to BHEL and GAIL will provide them with better functional and financial freedom and will also guarantee them with better valuation of the shares.

Ideally any Maharatna firm has a capacity to take investment decision of around 5000 crore Rupees without taking assistance from the government. On the other hand, forms with Navratna status have the capability of 1000 crore Rupees.

However, both BHEL and GAIL do not have enough non-official directors on the board, which is why they cannot exercise their Maharatna powers. Even though all other conditions of Maharatna status were met by both these PSUs but their boards do not have requisite number of board members. While GAIL is short of 4 independent directors, BHEL, on the other hand is short of 6 non-official directors.

In terms of turnover, networth as well as net profit, both these companies meet all the eligibility criterions.

Eligibility of a company to get a Maharatna status

•For any company to qualify for Maharatna status, the annual turnover should be over 25000 crore Rupees in past three years, as per the guidelines issued by Department of Public Enterprises.
•The net worth of the PSU should be more than 15000 crore Rupees in past three years.
•The net profit should be over 5000 crore Rupees during past three years.

At present, there are seven Maharatna companies, after inclusion of BHEL and GAIL and these companies are - ONGC, Indian Oil, SAIL, NTPC and CIL. Also, there are 14 Navratna companies, including Rashtriya Ispat Nigam Limited and NMDC.

Rashtriya Bal Swasthya karyakram launched

A new health initiative “Rashtriya Bal Swasthya Karyakram” was launched by Smt. Sonia Gandhi, Chairperson, UPA from Palghar, a Tribal Block in Thane district, Maharashtra today. The initiative is to provide comprehensive healthcare and improve the quality of life of children through early detection of birth defects, diseases, deficiencies, development delays including disability. 

Launching the programme, Smt. Gandhi said UPA Government is committed to achieve the objective of “Health for All” through accessible, affordable and equitable healthcare services. The Congress party has always strived to be the vehicle of empowerment of the people especially the marginalized sections of the society to see everybody’s dreams fulfilled through inclusive development. Under the National Rural Health Mission, several new initiatives have been taken, particularly to improve maternal and child health. Over Rs. 90,000 crores has been released to the states for strengthening health systems. Despite tremendous improvements in health indicators, about 15 lakh children die before their fifth birthday every year. Many more suffer from debilitating diseases affecting their growth and quality of life. 

Smt. Gandhi said India accounted for more than half of the global burden of polio in 2009. With intensive effort and resolute political will, India has remained polio free for more than two years now. Over 23 lakh volunteers under 1.7 lakh supervisors administer polio drops to about 17 crore children in one nation-wide round, which is the largest exercise in the world. There are 8.80 lakh ASHAs acting as a strong interface between the health system and the community. UPA 1 introduced Janani Suraksha Yojana in 2005 to encourage institutional deliveries by giving cash assistance to pregnant women as incentives. Building on the success of the JSY scheme, Janani Shishu Suraksha karyakram was launched in 2011 to eliminate out-of-pocket expenses for both pregnant women and sick neonates. Under this scheme, every pregnant woman is entitled to absolutely free delivery, including caesarean section, in public health institutions now. Besides the free ante-natal and post-natal check-ups, the scheme provides for free diagnostics, free medicines, free consumables, free food during hospital stay, free caesarean section and free blood, if required and free transport to health facility and drop back home. 

Smt. Gandhi said Mother and Child Tracking System (MCTS) has been put in place to reach out to every pregnant woman for proper care during pregnancy and to every child for proper vaccination. A BPO type system has been set up in the Health Ministry to verify data and give information about check-ups and immunization schedule. A new scheme has been initiated for the promotion of menstrual hygiene among adolescent girls in rural areas. It covers 1.5 crore girls in the age group of 10-19 years in 152 districts of 20 states. To address the growing burden of non-communicable diseases particularly diabetes, cardiovascular diseases and cancer a National Programme was initiated in 100 districts in 21 States for screening of persons above 30 years and pregnant mothers for early detection, control and treatment of diabetes, hypertension and cancer. Under the Pradhan Mantri Swasthya Suraksha Yojana, 6 new AIIMS have been established at Bhopal, Bhubaneswar, Jodhpur, Patna, Raipur and Rishikesh, each with a 976 bedded hospital with 42 super specialty departments and a medical college. In Phase II of PMSSY, 2 new AIIMS will come up at Rae Bareli in Uttar Pradesh and Raiganj in West Bengal. Besides this, up-gradation of 19 medical colleges with super-specialty blocks has been taken up across the country under PMSSY. 

Smt. Gandhi said the initial three years of a child’s life are most critical from the point of view of physical and cognitive development. Regular health screening and early intervention can yield rich dividends. Around 15 lakh children are born with defects, which contributes to 10% of neonatal mortality in our country. Many children suffer from developmental delays, diseases and deficiencies specific to childhood which, if unattended, become severely debilitating and a source of suffering for the entire family. With the launch of the Rashtriya Bal Swasthya Karyakram, regular health screening of children in public health facilities, Aanganwadis and Government and Government aided schools for defects at birth, diseases, deficiencies and development disorders will be done now. This programme will cover 25 crore children all over the country in a phased manner and provide for free follow up management and treatment at the district hospitals and at tertiary levels. She hoped that all State Governments would march in step with the Central Government and take proactive steps to roll out the screening and intervention services at the earliest to improve the survival, health and overall development of children. 

Addressing the programme, Shri Ghulam Nabi Azad, Union Minister of Health & Family Welfare said Smt. Gandhi has been always at the forefront in areas of public health, whether it is the flagging off the Red Ribbon Express to spread awareness against HIV/AIDS or the launch of the Janani Shishu Suraksha Karyakram to provide cashless healthcare to pregnant women and sick newborns during institutional deliveries. We are indeed privileged to have her with us at the National Launch of the Rashtriya Bal Swasthya Karyakram today. Continuum of care extending over different phases of the life over the first 18 years would improve the quality of life of children in our country, Shri Azad added

Amendments to the National Bank for Agriculture and Rural Development (NABARD) Act, 1981

The Union Cabinet  gave its approval to the amendments to the National Bank for Agriculture and Rural Development (NABARD) Act 1981 

The following amendments to the NABARD Act 1981 are proposed:- 

. 1. Raising the authorized capital of NABARD to Rs. 20,000 crore from Rs. 5,000 crore. 

2. The meaning of cooperative society is proposed to be enlarged to include multistate cooperative societies registered under any Central law or any other Central or State law relating to cooperative societies. 

3. Change of ownership to facilitate the transfer of the remaining share capital of NABARD from the Reserve Bank to the Central Government. 

4. Increasing the scope of operations of NABARD under short term funding purposes and other changes. 

The following benefits are projected by this amendment:- 

1. By increasing the authorized capital of NABARD to Rs 20,000 crore from Rs 5,000 crore, the ability of NABARD to mobilize resources from the market will be enhanced thereby new credit products, new credit linkages and new clients will be developed. 

2. The amendments allow NABARD to lend to new institutions, mainly Societies covered under multistate cooperative societies act and other central laws, producer organizations or such class of financial institutions which are approved by the Central Government. This is likely to benefit a larger segment of the financially excluded farmers in the country. 

3. The amendments allow combination of credit, creation of short term operations fund and swapping of debt of farmers. 

4. The decision of the Government to transfer the balance one percent shares to the Govt. of India from Reserve Bank of India (RBI) in NABARD shall be carried out, which will provide for increased public accountability, as the Government will acquire the equity held by RBI. 

5. NABARD will combine the post of Chairman and the post of Managing Director, into one, therefore Chairman and Managing Director, under the provisions of the NABARD Act relating to these two posts. This shall ensure a distinct line of command. 

Background 

NABARD was established on 12 July 1982 to provide sharp focus to agriculture credit and rural development. NABARD adopted, as its mission, the promotion of sustainable and equitable development of agriculture and rural prosperity through effective credit support, related services, institution development and other innovative initiatives.

Advance Estimates of National Income, 2012-13

The Central Statistics Office (CSO), Ministry of Statistics and Programme Implementation has released the advance estimates of national income at constant (2004-05) and current prices, for the financial year 2012-13.

2.         These advance estimates are based on anticipated level of agricultural and industrial production, analysis of budget estimates of government expenditure and performance of key sectors like, railways, transport other than railways, communication, banking and insurance, available so far. The advance estimates at current prices are derived by estimating the implicit price deflators (IPDs) at sectoral level from the relevant price indices. The salient features of these estimates are detailed below:

I           ADVANCE ESTIMATES OF NATIONAL INCOME, 2012-13

Estimates at Constant (2004-05) Prices

Gross Domestic Product

3.                  Gross Domestic Product (GDP) at factor cost at constant (2004-05) prices in the year 2012-13 is likely to attain a level of Rs.55,03,476 crore, as against the First Revised Estimate of GDP for the year 2011-12 of Rs. 52,43,582 crore, released on 31^st January 2013. The growth in GDP during 2012-13 is estimated at 5.0 per cent as compared to the growth rate of 6.2 per cent in 2011-12.

4.                  The sectors which registered growth rate of over 5 percent are ‘Construction’, ‘trade, hotels, transport and communication`, `financing, insurance, real estate and business services`, and `community, social and personal services`. There may be slow growth in the sectors of ‘agriculture, forestry and fishing’ (1.8%), manufacturing (1.9%) and electricity, gas & water supply (4.9%). The growth in the mining and quarrying sector is estimated to be (0.4%).

Agriculture

5.         The ‘agriculture, forestry and fishing’ sector is likely to show a growth of 1.8 per cent in its GDP during 2012-13, as against the previous year’s growth rate of 3.6 per cent. According to the information furnished by the Department of Agriculture and Cooperation (DAC), which has been used in compiling the estimate of GDP from agriculture in 2012-13, production of foodgrains is expected to decline by 2.8 per cent as compared to growth of 5.2 per cent in the previous agriculture year. The production of cotton and sugarcane is also expected to decline by 4.0 per cent and 6.5 per cent, respectively, in 2012-13. Among the horticultural crops, production of fruits and vegetables is expected to increase by 3.5 per cent during the year 2012-13 as against 5.1 percent in the previous year.

Industry

6.         The manufacturing sector is likely to show a growth of 1.9 per cent in GDP during 2012-13. According to the latest estimates available on the Index of Industrial Production (IIP), the index of manufacturing and electricity registered growth rates of 1.0 per cent and 4.4 per cent, respectively during April-November, 2012-13, as compared to the growth rates of 4.2 per cent and 9.5 per cent in these sectors during April-November, 2011-12. The mining sector is likely to show a growth of 0.4 per cent in 2012-13 as against negative growth of 0.6 per cent during 2011-12. The construction sector is likely to show a growth rate of 5.9 per cent during 2012-13 as against growth of 5.6 per cent in the previous year. The key indicators of construction sector, namely, cement production and steel consumption have registered growth rates of 6.1 per cent and 3.9 per cent, respectively during April-December, 2012-13.

Services

7.         The estimated growth in GDP for the trade, hotels, transport and communication sectors during 2012-13 is placed at 5.2 per cent as against growth of 7.0 percent in the previous year. This is mainly on account of decline of 3.4per cent and 4.8 per cent respectively in passengers and cargo handled in civil aviation and decline of 3.1 per cent in cargo handled at major sea ports during April-November, 2012-13. There has been an increase of 4.3 per cent in stock of telephone connections as on November 2012. The sales of commercial vehicles witnessed an increase of 0.74 per cent per cent in April-December 2012. The sector, `financing, insurance, real estate and business services`, is expected to show a growth rate of 8.6 per cent during 2012-13, on account of 11.1 per cent growth in aggregate deposits and 15.2 per cent growth in bank credit as on December 2012 (against the respective growth rates of 17.2 per cent and 16.0 per cent in the corresponding period of previous year). The growth rate of `community, social and personal services` during 2012-13 is estimated to be 6.8 per cent.

National Income

8.         The net national income (NNI) at factor cost, also known as national income, at 2004-05 prices is likely to be Rs.47,64,819 crore during 2012-13, as against the previous year`s First Revised Estimate of Rs. 45,72,075 crore. In terms of growth rates, the national income registered a growth rate of 4.2 per cent in 2012-13 as against the previous year’s growth rate of 6.1 per cent.

Per Capita Income

9.         The per capita income in real terms (at 2004-05 prices) during 2012-13 is likely to attain a level of Rs.39,143 as compared to the First Revised Estimate for the year 2011-12 of Rs. 38,037. The growth rate in per capita income is estimated at 2.9 per cent during 2012-13, as against the previous year`s estimate of 4.7 per cent.

Estimates at Current Prices

Gross Domestic Product

10.       GDP at factor cost at current prices in the year 2012-13 is likely to attain a level of Rs. 94,61,979 crore, showing a growth rate of 13.3 per cent over the First Revised Estimate of GDP for the year 2011-12 of Rs. 83,53,495 crore.

National Income

11.       The NNI at factor cost at current prices is anticipated to be Rs. 83,68,571 crore during 2012-13, as compared to Rs. 73,99,934 crore during 2011-12, showing a rise of 13.1 per cent.

Per Capita Income

12.       The per capita income at current prices during 2012-13 is estimated to be Rs. 68,747 as compared to Rs. 61,564 during 2011-12, showing a rise of 11.7 per cent.

II         ESTIMATES OF EXPENDITURES ON GDP, 2012-13

13        Alongwith the Advance Estimates of GDP by economic activity, the CSO is also releasing the Advance Estimates of expenditures of the GDP at current and constant (2004-05) prices. These estimates have been compiled using the data on indicators available from the same sources as those used for compiling GDP estimates by economic activity, detailed data available on merchandise trade in respect of imports and exports, balance of payments, and monthly accounts of central government. As various components of expenditure on gross domestic product, namely, consumption expenditure and capital formation, are normally measured at market prices, the discussion in the following paragraphs is in terms of market prices only.

Private Final Consumption Expenditure

14.       Private Final Consumption Expenditure (PFCE) at current prices is estimated at Rs. 57,05,857 crore in 2012-13 as against Rs. 50,56,219 crore in 2011-12. At constant (2004-05) prices, the PFCE is estimated at Rs. 34, 72,980 crore in 2012-13 as against Rs. 33,34,900 crore in 2011-12. In terms of GDP at market prices, the rates of PFCE at current and constant (2004-05) prices during 2012-13 are estimated at 56.9 per cent and 59.7 per cent, respectively, as against the corresponding rates of 56.3 per cent and 59.2 per cent, respectively in 2011-12.

Government Final Consumption Expenditure

15.       Government Final Consumption Expenditure (GFCE) at current prices is estimated at Rs. 11,86,726 crore in 2012-13 as against Rs 10,42,677 crore in 2011-12. At constant (2004-05) prices, the GFCE is estimated at Rs. 6,60,630 crore in 2012-13 as against Rs. 6,34,559 crore in 2011-12. In terms of GDP at market prices, the rates of GFCE at current and constant (2004-05) prices during 2012-13 are estimated at 11.8 per cent and 11.4 per cent, respectively, as against the corresponding rates of 11.6 per cent and 11.3 per cent, respectively in 2011-12.

Gross Fixed Capital Formation

16.       Gross Fixed Capital Formation (GFCF) at current prices is estimated at Rs. 29,93,873 crore in 2012-13 as against Rs. 27,49,072 crore in 2011-12. At constant (2004-05) prices, the GFCF is estimated at Rs. 19,44,279 crore in 2012-13 as against Rs.18,97,309 crore in 2011-12. In terms of GDP at market prices, the rates of GFCF at current and constant (2004-05) prices during 2012-13 are estimated at 29.9 per cent and 33.4 per cent, respectively, as against the corresponding rates of 30.6 per cent and 33.7 per cent, respectively in 2011-12. The rates of Change in Stocks and Valuables at current prices during 2012-13 are estimated at 3.0 per cent and 2.4 per cent, respectively.

17.       Estimates of gross/net national product, gross/net domestic product and per capita income, alongwith GDP at factor cost by kind of economic activity and the Expenditures on GDP for the years 2010-11 and 2011-12 and 2012-13, at constant (2004-05) and current prices are given in Statements 1 to 6.

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RBI panel proposes curbs on import of gold

The working group of the central bank on issues related to gold imports and gold loan NBFCs has proposed to limit import of gold into India, which is putting pressure on India’s current account and threatening the country’s sovereign credit ratings. It has also stated that a combination of demand-reduction and supply-management steps and measures to increase monetization of idle stocks of gold need to be put in place. 

The recommendations, if implemented by the government, will make gold costly and enhance the level of disclosure in gold loans business. This could lead to a tougher business environment for gold loan NBFCs.

The group also suggested that under extreme conditions, the government may also think of putting limits on the volume and value of gold to be imported by banks, and imposing export obligation on bulk gold importers.

It’s not only import of the yellow metal, the RBI panel in its report also suggested to the government to take steps that would make it easier for the authorities to track gold buyers, like payment by cheques for purchases above a threshold limit, use of income tax PAN by NBFCs giving loans over Rs 5 lakh and also use of know-your-customer processes for the buyers.

Although the working group stated that gold loan NBFCs are serving social causes, but it suggested that there was no case for granting these NBFCs a status at par with banks, these entities need to be monitored cautiously and their overdependence on banks for funds should be reduced. The RBI group also recommended that India’s idle gold reserves, which is about 20,000 tonnes at present, should be use to set up a gold bank and this reserve could be put into productive use through exchange-traded funds (ETFs).

On the issue of setting up the gold bank, RBI suggested that it may be given “powers to import, export, trade, lend and borrow gold and deal in gold derivatives.” The panel also suggested new ways to channelize investors’ savings into financial assets backed by gold, rather than they directly buying the metal in physical form.

Amendments to Regional Rural Banks (RRBs) Act, 1976

The Union Cabinet today gave its approval to the proposed amendments in the Regional Rural Banks (RRBs) Act, 1976 to enhance authorized and issued capital to strengthen their capital base. The term of the non official directors appointed by the Central Government is proposed to be fixed not exceeding two years. 

The proposed amendments will ensure financial stability of RRBs which will enable them to play a greater role in financial inclusion and meet the credit requirements of rural areas and the Boards of RRBs will be strengthened. 

Background 

Regional Rural Banks (RRBs) were established under Regional Rural Banks Act, 1976 (the RRB Act) to create an alternative channel to the `cooperative credit structure and to ensure sufficient institutional credit for the rural and agriculture sector. RRBs are jointly owned by the Government of India, the concerned State government and sponsor banks, with the issued capital shared in the proportion of 50 percent, 15 percent and 35 percent, respectively. As per provisions of the Regional Rural Banks Act, 1976 the authorized capital of each RRB is Rs. 5 crore and the issued capital is a maximum Rs. 1 crore. 

First Revised Estimates of National Income, Consumption Expenditure, Saving and Capital Formation, 2011-12

The Central Statistics Office (CSO), Ministry of Statistics and Programme Implementation has released the First Revised estimates of National Income, Consumption Expenditure, Saving and Capital Formation for the financial year 2011-12 along with the Second Revised Estimates for the year 2010-11 and Third Revised Estimates for the year 2009-10. As per the revision policy^#1, the First Revised Estimates for the year 2011-12 (earlier called Quick Estimates) have been compiled using industry-wise/institution-wise detailed information instead of the benchmark indicator method.

The estimates of Gross Domestic Product and other aggregates for the years 2009-10 and 2010-11 have been revised on account of use of latest available data on agricultural production, industrial production especially Annual Survey of Industries 2010-11 in lieu of the Index of Industrial Production, government expenditure (replacing Revised Estimates with Actuals for the year 2010-11) and also detailed and more comprehensive data available from various source agencies like Reserve Bank of India and State Directorate of Economics and Statistics.

The salient features of the estimates at aggregate level, which are based on latest available information, are indicated below:

GROSS DOMESTIC PRODUCT AND GROSS NATIONAL INCOME

Gross Domestic Product (GDP) at factor cost at constant (2004-05) prices in 2011-12 is estimated at ` 52,43,582 crore as against ` 49,37,006 crore in 2010-11 registering a growth of 6.2 per cent during the year as against a growth of 9.3 per cent in the year 2010-11. At current prices, GDP in 2011-12 is estimated at ` 83,53,495 crore as against ` 72,66,967 crore in 2010-11, showing an increase of 15.0 per cent during the year, as against an increase of 19.0 per cent in the previous year.

At constant (2004-05) prices, the Gross National Income at factor cost in 2011-12 is estimated at ` 51,96,848 crore as against` 48,82,249 crore in 2010-11 showing a rise of 6.4 per cent during the year, as against an increase of 8.8 per cent in the previous year. At current prices, the Gross National Income in 2011-12 is estimated at ` 82,76,665 crore as compared to `71,85,160 crore in 2010-11, showing a rise of 15.2 per cent during the year, as against an increase of 18.4 per cent in the previous year.

The growth rate of 6.2 per cent in the GDP during 2011-12 has been achieved due to growth in financing, insurance, real estate & business services (11.7%), transport, storage and communication (8.4%), electricity, gas & water supply (6.5%) and trade, hotels & restaurants (6.2%). At constant prices, the primary sector, i.e. agriculture, forestry & fishing has shown a growth of 3.6 per cent during 2011-12 as against 7.9 per cent during the year 2010-11. The growth of secondary sector is 3.5 per cent and that of service sector is 8.2 per cent during 2011-12, as against a growth of 9.2 per cent and 9.8 per cent, respectively, in the previous year.

Gross Domestic Product (GDP) at market prices at constant (2004-05) prices in 2011-12 is estimated at ` 56,31,379 crore as against ` 52,96,108 crore in 2010-11 registering a growth of 6.3 per cent during the year as against a growth of 10.5 per cent in the year 2010-11. At current prices, GDP at market prices in 2011-12 is estimated at ` 89,74,947 crore as against ` 77,95,314 crore in 2010-11, showing an increase of 15.1 per cent during the year, as against an increase of 20.3 per cent in the previous year.

CONSUMPTION EXPENDITURE, SAVING AND CAPITAL FORMATION

As various components of expenditure on Gross Domestic Product, namely, Consumption Expenditure and Capital Formation, are normally measured at market prices, the discussion in the following paragraphs is in terms of market prices.

PRIVATE FINAL CONSUMPTION EXPENDITURE

Private Final Consumption Expenditure (PFCE) at current prices is estimated at ` 50,56,219 crore in 2011-12 as against `43,49,889 crore in 2010-11. At constant (2004-05) prices, the PFCE is estimated at ` 33,34,900 crore in 2011-12 as against `30,88,880 crore in 2010-11. In

terms of GDP at market prices, the rates of PFCE at current and constant (2004-05) prices during 2011-12 are estimated at 56.3 per cent and 59.2 per cent, respectively, as against the corresponding rates of 55.8 per cent and 58.3 per cent, respectively in 2010-11.

DOMESTIC SAVING

Gross Domestic Saving (GDS) at current prices in 2011-12 is estimated at ` 27,65,291 crore as against ` 26,51,934 crore in 2010-11, constituting 30.8% of GDP at market prices as against 34.0% in the previous year. The decrease in the rate of GDS has mainly been due to the decrease in the rates of financial savings of household sector from 10.4% to 8.0%, private

corporate sector from 7.9% to 7.2% and that of public sector from 2.6% to 1.3% in 2011-12 as compared to 2010-11. In absolute terms, the saving of the household sector has increased from ` 18,32,901 crore in 2010-11 to ` 20,03,720 crore in 2011-12, increasing by 9.3% during the year. The saving of private corporate sector has gone up by 4.1% from ` 6,19,370 crore in 2010-11 to ` 6,44,473 crore in 2011-12 . However the saving of public sector has gone down by 41.4% from ` 1,99,662 crore in 2010-11 to ` 1,17,097 crore in 2011-12.

CAPITAL FORMATION

Gross Domestic Capital Formation has increased from ` 28,71,649 crore in 2010-11 to ` 31,41,465 crore in 2011-12 at current prices and it increased from ` 21,20,377 crore in 2010-11 to ` 21,31,839 crore in 2011-12 at constant (2004-05) prices. The rate of Gross Capital Formation at current prices is 35.0 per cent in 2011-12 as against 36.8 per cent in 2010-11. The rate of Gross Capital Formation at constant (2004-05) prices is 37.9 per cent in 2011-12 as against 40.0 per cent in 2010-11.

Within the Gross Capital Formation at current prices, the Gross Fixed Capital Formation amounted to ` 27,49,072 crore in 2011-12 as against ` 24,74,464 crore in 2010-11, increasing by 11.1% during the year. At current prices, the Gross Fixed Capital Formation of the public sector has increased by 9.3% from ` 6,06,245 crore in 2010-11 to ` 6,62,698 crore in 2011-12, that of private corporate sector by 1.0% from ` 8,58,558 crore in 2010-11 to ` 8,67,020 crore in 2011-12, and the household sector by 20.7% from ` 10,09,662 crore in 2010-11 to ` 12,19,354 crore in 2011-12.

The change in stocks of inventories, measured as additions to stocks decreased by 22.7% at current prices, from ` 2,45,113crore in 2010-11 to ` 1,89,384 crore in 2011-12. The decrease is observed due to decrease in change in stocks of public and private corporate sector.

ESTIMATES AT PER CAPITA LEVEL

The per capita income (per capita Net National Income at factor cost) in real terms, i.e. at 2004-05 prices, is estimated at `38,037 for 2011-12 as against ` 36,342 in 2010-11, registering an increase of 4.7 per cent during the year, as against an increase of 7.2% during the previous year.

The per capita income at current prices is estimated at ` 61,564 in 2011-12 as against ` 54,151 for the previous year depicting a growth of 13.7 per cent, as against an increase of 17.1% during the previous year.

The per capita PFCE at current prices in 2011-12 is estimated to be ` 42,065 as against ` 36,677 in the year 2010-11, showing an increase of 14.7% as against an increase of 15.7% in the previous year. The corresponding estimates at constant (2004-05) prices are ` 27,745 and ` 26,045, registering an increase of 6.5% in 2011-12, as against an increase of 7.1% in the previous year.

The estimates of National Product, Consumption Expenditure, Saving and Capital Formation at aggregate and per capita levels for the years 2004-05 to 2011-12 are presented in Statement 1 and the detailed estimates at industry/item level in Statements 2 to 8. The statements on Income & Outlay Account and Capital Finance Account of the Administrative Departments, as also the Price and Quantum Indices are available on the website of the Ministry, www.mospi.gov.in.

# As available on www.mospi.gov.in

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