Old technology
Inadequate network as per economy’s requirement
Financial crunch
Suffer heavy losses because of social responsibilities
Over crowding
Low safety measures-
Steps taken for improvement:
Better resource management Rational price policy
Increased wagon load
Faster turnaround time
Public-Private Partnerships
Double line freight corridor
Roads
- Second largest network in the world
- 4.2 million km of total road length out of which almost 50% is surfaced
- National highways encompass a road length of 66,800 kms and carry more than 40% of traffic
- Rural areas have 65 per cent all weather roads.
- Roads, in India, carry nearly 60% of freight and 87% of passenger traffic.
- Problems:
Inadequate road length compared to the country size
Some areas not yet linked with roads
Large percentage of rural roads are mud roads
Poorly maintained urban roads
Most of the State Road Transport Corporations are running on heavy losses
- Steps taken:
National Highways Development Project (NHDP) has been taken up
Public Private Partnership (PPP) in roads developments
Taxes have been rationalised Water Transport
- Water transport: Inland water transport & Shipping - Shipping: Coastal shipping and overseas shipping - 14500 km of navigable waterways
- 50 million tonnes of cargo is being annually moved by inland water transport - 5 waterways have been declared as National Waterways (NWs).
- Eleventh plan aims: making existing waterways fully operational & adding 3 more NWs
- India has a long coastline of 7,517 kms - India has 12 major ports and 200 minor ports
- The Gross Tonnage (GT) increased from 0.31 million in 1961 to 1.02 million in 2011
- Reasons for poor growth of coastal shipping:
high transportation costs
port delays
over-aged vessels
lack of mechanical handling facilities
imbalance in coastal traffic movement
slow handling of the cargo
- Sea route carries 95% of India’s global merchandise trade - Shipping tonnage: 10.4 million in 2011
- Problems faced by Indian ports:
Low productivity
Poor competitiveness
Operational constraints
Inadequate port facilities
Inefficient deployment of port equipment
Improper coordination
Indian containers are costlier than other ports Air Transport
- 10 scheduled passenger operators
- Public sector passenger operators: NACIL, Air India Charters Ltd. and Alliance Air
- There are 7 passenger operators in private sector - India has two cargo operators
- Total fleet size: 397 aircrafts
- Airline’s share in domestic traffic during 2010 reached 82%
- Airport Authority of India manages 126 airports, including 16 international airports and 26 civil enclaves
- Domestic passenger traffic: 108 million during January – November 2011 - International passenger traffic: 33.5 million during January – November 2011 COMMUNICATION
Postal Services
- Largest postal network in the world - India has 1.55 lakh post offices
- One post office serves 7814 persons and 21.23 sq. km area - Weaknesses:
Inadequate number of post offices
Use of outdated techniques
Delays in reaching of posted material - Steps taken:
Introduction of speed post, express parcel post, media post etc.
Introduction of e-enabled services
Mechanization and computerization of postal operations
Automatic mail processing centers (AMPC) have been set up
E-post services have been started
Introduction of financial products by post offices
Introduction of “Project Arrow” with the aim of providing fast and reliable postal services
Telecommunications
- India had more than 943 million connections (Feb 2011)
- India’s telephone network is the second largest in the world (after China) - Tele density: (Nov, 2010)
Total- 76.86%
Rural- 37.5%
Urban- 167.4%
- Increase in internet connections from 0.01million in 1995 to around 21 million in 2011
- Telecom Regulatory Authority of India (TRAI) is the regulatory authority - National Internet Exchange of India (NIXI) is set up to handle internet traffic - FDI ceiling has been raised to 74% from 49%
- National Telecom Policy (NTP) was announced in 2012 to attract additional investment
HEALTH
- Good health comes from (1) balanced and nutritional diet and (2) medical care
- Low health standard in India because 37% of population lives below poverty line
- Various health development programmes have been integrated with family welfare and nutritional programmes
- Focus is now on providing better health and medical care services to the poor people
- Efforts to provide hygienic conditions
- There is a fall in the incidence of certain diseases like T.B, leprosy and polio - There is a rise in the incidence of certain diseases like AIDS, blindness, cancer
etc.
EDUCATION
- India has the one of the largest education systems in the world
- The National Policy on Education (NPE) was introduced in 1986 & modified in 1992 which emphasized on: universal access and enrolment; universal retention of children up to 14 years of age and a substantial improvement in the quality of education.
- Target expenditure on NPE: 6% of GDP
- Actual expenditure on NPE: 3.13% of GDP (2009-10)
- Right of Children to Free and Compulsory Education Act (RTE Act) 2009 gave children between age 6 to 14years a right to free education
- Gross enrolment ration for age group 6 – 14 years increased to 96.7 in 2011 - Sarva Shiksha Abhiyan (SSA) launched in 2001-02.
- National Programme for Education of Girls at Elementary Level (NPEGEL) &
Education Guarantee Scheme and Alternative and Innovative Education (EGS + AIE) are important parts of SSA
- The number of secondary and higher education school has increased from 7416 in 1950-51 to about 1,72,000 in 2007-08
- Rashtriya Madhyamik Shiksha Abhiyan was launched in 2009 to enhance the access to secondary education
- Technical education has improved significantly
- National Literacy Mission (NLM) was launched in 1998 to impart functional literacy to non-literates
- Problems:
Deterioration of academic standards
Inadequate number of institutions
Large number of unemployed educated people
Large-scale migration of educated people
Lack of infrastructure
Neglect of primary education
Regional disparities
Large number of dropouts - Steps to be taken:
Restrictions should be imposed on higher education
Education should be made job-oriented
Expansion should be properly planned
There should be emphasis on rural areas
Brain drain should be stopped
The standard of education should be raised
Drop out ratio should be controlled
INFLATION
Persistent upward movement in the general price level which results in fall in purchasing power
Demand-pull inflation – Occurs when the aggregate demand in the economy is more than the aggregate supply. This pushes up the overall price level.
Cost Push inflation - Caused by substantial increases in the cost of important goods or services where no suitable alternative is available. As the cost of production increases, the market prices of goods and services are increased.
Stagflation - Situation where an inflation rate is high, the economic growth rate slows down, and unemployment remains steadily high.
Deflation – Prices falls & purchasing power increases PRICE TRENDS IN INDIA
Wholesale Price Index - Price of a representative basket of wholesale goods which comprises 676 items which carry different weights.
Consumer Price Index – It measures changes in the price level of consumer goods and services purchased by households
- Inflation was highest in 1966-76 i.e. 14%
- Inflation was lowest in 1950s
- Current rate of inflation is 9% (2011-12) - Food inflation is almost 9%
CAUSES FOR INFLATION IN INDIA
- Public expenditure has risen from 18.6% of GDP (1961) to around 27% (2011-12)
- Deficit financing
- Erratic agricultural growth
- Price support to the agriculturists
- Inadequate rise in industrial production - Upward revision of administered prices
- Failure of the government to properly tax the income - Large scale tax evasion
- Black marketing
- Underutilization of industrial capacity - High capital-output ratio
- Raw material shortage MEASURES TO CHECK INFLATION
Monetary measures-
- Increase repo rate
- Sell government securities in open market - Increase Cash Reserve Ratio (CRR)
Fiscal measures-
- Increase tax rates
- Introduce new types of taxes
- Improve profits of public sector units - Control over public expenditure Control over investment-
- Resources should be employed in a way that it does not increase inflation Other measures-
- Short term measures: Distribution of commodities through fair price shops, control over movement of commodities
- Long term measures: Accelerating economic growth, restriction on present consumption