Sunday, January 30, 2011

DAVOS - Leaders call for global trade deal this year as Red Alert for Aboriginal Indigenous Humanscape! India will double its investments in infrastructure to $1 trillion during the 11th Five Year Plan that begins 2012, with half of that expected fro

DAVOS - Leaders call for global trade deal this year as Red Alert for Aboriginal Indigenous Humanscape! India will double its investments in infrastructure to $1 trillion during the 11th Five Year Plan that begins 2012, with half of that expected from the private sector, Planning Commission Deputy Chairman Montek Singh Ahluwalia has said.It means, Complete Ethnic Cleansing to push Economic Reforms to Sustain MANUSMRITI LPG MAFIA Rule! Infrstructure and Development on whose cost, just trace the history of Destruction for the Excluded Communities since Power transferred to Brahamin Bania Corpoarte Raj!Amenesty for Tax Evaders has been JUSTIFIED with Excellent Cover Up as  FinMin sets up panel on ''voluntary compliance'' for BLACK Money!

Parliamentary Soap Opera continues with new Flavour as  BJP senior leader Arun Jaitley said that obstruction of parliament is not undemocratic. While addressing a party meeting in Ranchi on Saturday, he also said that he hopes the central government would stick to its word and discuss all issues including corruption in the upcoming Budget session of Parliament scheduled to begin from February 21. Jaitley also claimed that the Congress led United Progressive Alliance is no more a strong alliance capable to rule the country.CPI-M General Secretary Prakash Karat today said Left parties will not stall parliamentary proceedings in the coming budget session but there will be no compromise on the demand for a JPC probe into the 2G spectrum scam.

Sibal says to make 2G mobile spectrum price market-linked. Indian students treated as Cattle with radio colour. Who allowed foreign Universities to make Knowledge Economy in India? Friends, critique of US Human Rights would not repair the situation deterioting day by day as the Government of India Incs has allowed FOREIGNERS in Indian Market to loot Ntaural as well as Human Resources. OIL is Decontrolled. Education is Knowledge Economy. Infrstructure and realty Boom! Disinvestment and UID.It is a COMPLETE Package of Mass Destruction. Not only the Students stranded in USA, but we, the majority Enslaved People in India, do wear the Electronic Gadget violating CIVIC as well as Human rights.

Amenesty for Tax Evaders has been JUSTIFIED with Excellent Cover Up as  FinMin sets up panel on ''voluntary compliance'' for BLACK Money!Amid the growing clamour to crack down on generation of black money, the Finance Ministry has instituted a study group to improve "voluntary compliance" by suggesting appropriate measures to motivate tax evaders to disclose their unaccounted funds.

Indian Holocaust My Father`s Life and Time -FIVE HUNDRED  SEVENTY SEVEN

Palash Biswas

Red Alert for Aboriginal Indigenous Humanscape! India will double its investments in infrastructure to $1 trillion during the 11th Five Year Plan that begins 2012, with half of that expected from the private sector, Planning Commission Deputy Chairman Montek Singh Ahluwalia has said.It means, Complete Ethnic Cleansing to push Economic Reforms to Sustain MANUSMRITI LPG MAFIA Rule! Infrstructure and Development on whose cost, just trace the history of Destruction for the Excluded Communities since Power transferred to Brahamin Bania Corpoarte Raj!World leaders appealed on Friday for all nations to make concessions and reach a deal on long-running trade talks by the end of this year or risk losing the opportunity for years.

Sibal says to make 2G mobile spectrum price market-linked. Indian students treated as Cattle with radio colour. Who allowed foreign Universities to make Knowledge Economy in India? Friends, critique of US Human Rights would not repair the situation deterioting day by day as the Government of India Incs has allowed FOREIGNERS in Indian Market to loot Ntaural as well as Human Resources. OIL is Decontrolled. Education is Knowledge Economy. Infrstructure and realty Boom! Disinvestment and UID.It is a COMPLETE Package of Mass Destruction. Not only the Students stranded in USA, but we, the majority Enslaved People in India, do wear the Electronic Gadget violating CIVIC as well as Human rights.

Parliamentary Soap Opera continues with new Flavour as  BJP senior leader Arun Jaitley said that obstruction of parliament is not undemocratic. While addressing a party meeting in Ranchi on Saturday, he also said that he hopes the central government would stick to its word and discuss all issues including corruption in the upcoming Budget session of Parliament scheduled to begin from February 21. Jaitley also claimed that the Congress led United Progressive Alliance is no more a strong alliance capable to rule the country.CPI-M General Secretary Prakash Karat today said Left parties will not stall parliamentary proceedings in the coming budget session but there will be no compromise on the demand for a JPC probe into the 2G spectrum scam.

"We do not want to stall parliamentary proceedings but there can be no compromise on the demand for the JPC probe. If the UPA government does not allow a probe, people''s suspicion on the government''s involvement in the scam will go up," he told a rally organised here to protest against communalism and price rise.

"Since Independence this (2G spectrum allocation) is the biggest scam in the country and the Parliament has every right to inquire into it," he said.

Terming Congress as the "master of corruption", Karat said that during the prime ministership of Rajiv Gandhi the Bofors scam amounting to Rs 64 crore came to light and the cases on it are still on even after about two decades.

"The Manmohan Singh government has brought in the looting raj in the country and during its tenure the Rs 1,76,000 crore telecom scam has taken place," he said.

Meanwhile, Amenesty for Tax Evaders has been JUSTIFIED with Excellent Cover Up as  FinMin sets up panel on ''voluntary compliance'' for BLACK Money!Amid the growing clamour to crack down on generation of black money, the Finance Ministry has instituted a study group to improve "voluntary compliance" by suggesting appropriate measures to motivate tax evaders to disclose their unaccounted funds.The study, which will be conducted by economic and tax experts, is also aimed at stopping "commoditisation of tax avoidance schemes".

President Pratibha Patil and Prime Minister Manmohan Singh today led the nation in paying homage to Father of the Nation Mahatma Gandhi on his 63rd death anniversary.

Patil, Vice President Hamid Ansari, Singh, UPA Chairperson Sonia Gandhi and Leader of Opposition in Lok Sabha Sushma Swaraj paid floral tributes at Gandhi''s memorial in Rajghat.

Defence Minister A K Antony, former Deputy Prime Minister L K Advani, Urban Development Minister Kamal Nath, Delhi Chief Minister Sheila Dikshit, chiefs of three services, central ministers, leaders of various political parties and people from different walks of life also paid tribute to the apostle of peace at his memorial.

A multi-faith prayer service was also organised with religious leaders of Hinduism, Islam, Buddhism, Bahai, Christianity, Jainism, Jewish, Parsi and Sikhism participating in the programme.
Devotional songs were also sung.

Martand Pandit reacts rightly:

Can you trust Mr. Pranab Mukherjee, the finance minister, who inserted a clause in financial bill to benefit Reliance Group. Can you trust the income tax people who keep on hounding honest tax payers and are chased away by people like Hasan Ali Khan. When a common man books a flat, he is served notice and when Rahul Gandhi buys it in bulk with Emmar MGF, the files seized during raid at Emmar MGF are destroyed to close the case. In this pathetic situation, the practice of forming study group on black money is nothing but pouring acid in the eyes of common man.

The latest study comes in the backdrop of Finance Minister Pranab Mukherjee''s statement that two groups have been constituted to look into different aspects of black money, including a proposed amnesty scheme to unearth unaccounted wealth.

As per the statement of the proposal put forward by the Income Tax Department, "Complexity and innovation in business structures, new financial products, a large number of taxpayers, growth in international trade supported by rapid expansion of e-commerce, commoditisation of tax avoidance schemes are some of the factors leading to increased compliance risk for the tax administration."
It may not be possible for the Income Tax Department to address these risk factors through the traditional tools based on verification and enforcement action alone, the proposal added.

"Tax compliance costs impose a burden on the taxpayers. If the amount is a big percentage of the tax payable, it deters small and medium taxpayers from being a part of the tax system," it said.
As such, "The challenge before the I-T Department is to ascertain the extent of compliance cost for different categories of taxpayers and develop focused programmes to reduce the compliance costs for improving voluntary compliance," the statement said.

"The study group will strategise to increase direct tax collections and suggest measures to curb tax evasion effectively in the changing business scenario, which includes curbing generation of black money," a senior Finance Ministry official said.

The study group, according to the official draft of the Finance Ministry, will undertake a four-pronged approach to "better understand compliance issues from the perspective of taxpayers".

The group will then make recommendations with respect to the operational decision-making process on the basis of views expressed by affected parties, as well as facilitate participation in the tax system by all segments of taxable citizens. In addition, it will study the barriers to compliance as an ongoing programme and the compliance cost with respect to different categories of taxpayers on a periodic basis. .

Speaking at the annual meeting of the World Economic Forum at this Swiss ski resort, the key policy maker,Ahluwalia said the private sector investment so envisaged includes capital inflow from overseas.

'We didn't invent the term 'inclusive growth' to mean 'inclusive of the private sector and inclusive of foreign investment' -- but that's clearly the nature of the policy,' Ahluwalia said at a session on inclusive growth.

'In India, it is clear: It's private sector-led growth in which the government plays a very important role in providing the infrastructure that will make this growth possible, and it's the social policy that will make growth inclusive.'

Jamshyd N. Godrej, chairman and managing director of Godrej and Boyce Manufacturing Co, said that inclusive growth was transforming India. He pointed to 'Bihar, a state that had been the poster boy of no development, is now in the vanguard of growth'.

Agreeing with Godrej, Janmejaya K. Sinha, chair for Asia-Pacific region with The Boston Consulting Group, said the obligation of financial institutions and banks to serve the underprivileged people had thrown open immense opportunities.

'In India, some 55 percent of people are excluded from financial services, and most of these are below 30. So, there's an opportunity of having 400 million customers for 45 years,' Sinha said.

The meeting was attended, among others, by business leaders, investors and academics including Prof Joseph Stiglitz of Columbia University in New York and a winner of the Nobel Prize for Economics.

British Prime Minister David Cameron told the Davos World Economic Forum it was "frankly ridiculous" that the Doha round of world trade talks had so far limped on for a decade.

"We simply cannot spend another 10 years going round in circles," he said. "...I call on every world leader to join me. We've got one last chance to get this right -- 2011 is the make or break year."

Cameron spoke alongside German Chancellor Angela Merkel, Indonesian President Susilo Bambang Yudhoyono and World Trade Organisation (WTO) chief Pascal Lamy.

"The right answers in this crisis must also to reduce barriers", Merkel said. "...the cheapest way to boost our competitiveness and to give a boost to our economic development is free trade".

Yudhoyono said that "fair, free and open trade is more important than aid" for developing nations.

The European Union, the world's biggest exporter, hosted a dinner on Friday for trade ministers from the other key players -- Australia, Brazil, China, India, Japan and the United States -- in Davos.

The seven will take stock of the Doha round. Members of the World Trade Organization have agreed to intensify the pace of negotiations, already in their 10th year, after the G20 urged them to use 2011 as a window of opportunity to reach a deal.

But a warning from the trade ministers of Brazil, India, China and South Africa ahead of the dinner underlined just how difficult compromise could be.

The four ministers said concessions already made by their emerging economies were not being matched by rich countries, who were now demanding more, and that such demands jeopardised efforts to conclude the Doha round.

Friday's dinner will be followed by a broader meeting of about 25 trade ministers on Saturday.

A report by trade experts presented at Friday's panel discussion recommended heads of government get personally involved in reaching a Doha trade deal and set themselves an end-year deadline to achieve it.

"What is already on offer is a package that would provide a global economic stimulus of hundreds of billions of dollars in new trade annually," the report's preface said.

"Everyone would gain".

The Doha round was launched in late 2001 to boost the world economy and help poor countries prosper through trade.


The wide-ranging and complex talks have missed repeated deadlines and some negotiators say 2011 will go the same way, perhaps dooming the negotiations altogether.

U.S. President Barack Obama showed little interest in a WTO deal in his first two years in office, mindful of his supporters in organised labour and their Democratic allies in Congress.

But in recent months the talks in Geneva have moved up a gear and some believe the necessary trade-offs are now possible.

"There seems to be a general acceptance that what is needed to bring Doha to a successful conclusion is for the major countries to bring a little bit more to the table," Australian Trade Minister Craig Emerson told Reuters.

Emerson said Australia, one of the keenest proponents of a deal, does not believe that it is the one blocking agreement, but would consider further concessions as part of a final push.

"If it's a matter of the demonstration of good faith and everyone bringing more to the table then Australia would be a willing participant in that," Emerson said.

In the end the deal will require bilateral agreement between the United States and China, the world's two biggest economies.

But it is much more complicated than that, with competitive exporters among the emerging economies wanting to boost South-South trade by opening markets as well.

There is no sign so far of progress narrowing gaps on proposals allowing developing countries to limit imports of food, which contributed to the collapse of a meeting of ministers to push for a deal in 2008, said Gonzalez, who was a top WTO agriculture official during that meeting.

"That continues to be a very contentious issue," she said.

The changing nature of world trade may also make it easier to open markets by cutting import duties, as global supply chains mean tariffs amount to a tax on your own business. "If you protect imports you will damage your exports," World Trade Organization Director-General Pascal Lamy told reporters.

''Time ripe for implementing working group recommendations''

Srinagar, Jan 30 (PTI) Ruling National Conference in Jammu and Kashmir today advocated early implementation of recommendations of working groups set up by Prime Minister Manmohan Singh and improvement of ties between India and Pakistan for establishing peace in the state.

"The time is ripe for implementation of recommendations of the working groups on Kashmir especially the Justice Sagir (committee) report," General Secretary of the National Conference Sheikh Nazir Ahmad said in a statement here.

He said Justice Sagir''s report on autonomy to the state is appropriate and timely. "Delaying the recommendations of the working groups is harmful," he said.

Appealing to India and Pakistan to resume the composite dialogue for resolution of all outstanding issues including Kashmir, he said, "The friendly relation between New Delhi and Islamabad is imperative for everlasting peace in the region and also holds the key to resolving Kashmir issue."

"We appeal to the leadership of India and Pakistan to improve their relations by fruitful dialogue for peace in the sub-continent... bitter ties between the two countries has a direct impact on the people of Kashmir," he said.

Criticising the policy of right-wing parties, Ahmad said, "BJP and its like-minded parties should be aware that the state was not merged with India.

"As per the document of accession executed by Maharajah Hari Singh, the state acceded to the dominion of India on condition and as a consequence of this conditional accession, Article 370 of the constitution was incorporated to grant special autonomous status to Jammu and Kashmir," he said.
He said the state has its own flag and constitution and does not believe in the politics of hatred.
"The state is playing its role with sincerity for maintaining integrity of the country and ensure its development."

Lauding Omar Abdullah-led coaltion government in the state, Ahmad said the government has taken the state to new heights of development.

Karmapa asked 50 questions, denies allegations

Tibetan religious leader, the Karmapa, was asked a set of 50 questions by police Sunday about nearly Rs.70 million worth of unaccounted foreign and Indian currency being found in his monastery. Denying all allegations, he said the money was given by devotees all over the world.

A police team, led by Una'a Additional Superintendent of Police K.G. Kapoor, reached the monastery near here to question the 17th Karmapa, Ogyen Trinley Dorje, who was quizzed Friday as well.

'Fifty questions were asked to the Karmapa and he denied all allegations. He said the money recovered was money given by devotees,' Kapoor said. 'But we are not happy with his replies and he is likely to be questioned again,' he added.

Also in connection with the controversy, Dharamsala businessman and hotelier K.P. Bhardwaj and D.K. Dhar, manager of the Corporation Bank in Ambala in Haryana, were Sunday brought for interrogation to Una, 100 km from the Karmapa's monastery, police said.

Inspector General of Police P.L. Thakur had earlier said that through their questions, they would try to ascertain the sources of the money, why such a huge amount was kept at the monastery and whether it was meant for some kind of land deal.

Another police official said the state government had got the green signal from the Union home ministry to pose questions to the Karmapa.

A string of central government agencies got into the picture Saturday to get to the bottom of the recovery of unaccounted currency. The most baffling part of the total seizure from the monastery was the 1.1 million (Rs.7 million) in Chinese currency and over 600,000 US dollars.

The presence of Chinese Yuan brought controversy about the Karmapa's alleged links to China to the fore again. He had arrived mysteriously from his monastery near Lhasa in Tibet region in January 2000.

However, the Karmapa late Saturday clarified there was no China link to his activities and the foreign currency seized was from disciples from all over the world.

The Karmapa's office, in a statement, said: 'The cash in question, under current investigation by police is offerings received for charitable purposes from local and international disciples from many different countries wishing to support His Holiness Karmapa's various charitable activities.'

Dharamsala businessman Bhardwaj, who is believed to have struck a land deal with the Karmapa's trust, and a bank manager from Haryana were arrested and are being questioned.

'Bhardwaj was arrested last (Saturday) evening as an unaccounted Rs.1 crore was seized from two of his men on Jan 25 at Mehatpur in Una district,' Thakur said.

Bhardwaj had claimed that the Rs.1 crore recovered from the men was a payment made by the Karmapa's trust to buy land near here.

It was after the seizure of this Rs.1 crore that the Gyuto Tantric University and Monastery, where the Karmapa has been residing for the last few years with his followers, was raided and huge amounts of foreign and Indian currency recovered.

Dhar, the Corporation Bank manager, was also arrested Saturday night for allegedly facilitating a transaction of Rs.1 crore to Bhardwaj. The two were Sunday brought to the police station in Una, some 100 km from the monastery, for questioning.

'Both Bhardwaj and Dhar have been brought to Una for interrogation,' said Superintendent of Police Santosh Patiyal.

Terrorism, piracy top agenda of British navy chief's visit

Security and terrorism in south Asia and piracy in the Indian Ocean are likely to dominate discussions between India's security brass and Britain's navy chief Admiral Sir Mark Stanhope during his five-day visit beginning Sunday.

Admiral Stanhope, Britain's First Sea Lord, will meet Defence Minister A.K. Antony and the three services chiefs and discuss aspects of India-Britain defence relations and Britain's security policy, including maritime cooperation.

He will also deliver a lecture on 'Indian Ocean and Maritime Security' at the National Maritime Foundation, a think-tank under the auspices of the Indian Navy.

The Royal Navy chief's visit is the first top-level defence visit from Britain this year.

It comes six months after British Prime Minister David Cameron's visit in July last year when the two sides expressed their desire to expand the defence and security relationship.

Royal Air Force chief Sir Stephen Dalton visited India in November last year.

After his stay in the capital, Admiral Stanhope will travel to Mumbai, where he will visit defence shipyard, Mazagon Docks, and hold discussions with the Western Naval Commander Vice Admiral Sanjeev Bhasin.

The Indian Navy is part of a multi-national anti-piracy effort in Gulf of Aden off Somalia since October 2008 in which the Royal Navy too is a partner.

The two navies also hold a series of maritime exercises called Konkan, which began in 2004. The 2010 edition of Konkan was held in July off Mumbai coast when Indian and British submarines carried out underwater warfare manoeuvres.

Sibal says to make 2G mobile spectrum price market-linked
On Saturday 29 January 2011, 5:05 PM
By Devidutta Tripathy

NEW DELHI (Reuters) - India will de-link second-generation radio (2G) spectrum that now comes free with telecoms licences and ask companies to pay for spectrum based on a market-driven mechanism, the telecoms minister said, unveiling the broad contours of a new telecoms policy.

Kapil Sibal also told reporters bigger telecoms carriers such as Bharti Airtel and Vodafone's India unit will be asked to pay market-linked prices for 2G radio-spectrum beyond 6.2 mega hertz. Such a pricing mechanism is yet to be finalised.

The government's move is seen as a bid to make the world's second-largest and fastest-growing market for mobile phone services more transparent.

The sector was hit by controversy over the awarding of licences and spectrum in 2007-08, sparking a political row in Asia's third-largest economy, with the opposition attacking the government for failing to fight graft.

A state auditor's report that India lost $39 billion in revenue due to irregularities in the grant of licences led to the resignation of then Telecoms Minister Andimuthu Raja.

Sibal, who took over in November after his predecessor quit, has said the government will announce a new telecoms policy this year, overhauling decade-old telecoms rules.

Under the present rules, mobile operators pay a total 16.58 billion rupees ($362 million) for licences in all of India's 22 zones and get 4.4 mega hertz of initial spectrum bundled with the licences without having to pay any additional price for it.

"We think there needs to be a directional shift away from the old policy... We are going to delink the licence from the spectrum in the new dispensation," Sibal told reporters on Saturday.

"Henceforth, spectrum will be awarded, apart from delinking, on a market-based pricing mechanism," he said, adding the price of spectrum would be determined either by auction or through some other process depending on the regulator's proposals.

India last year sold third-generation (3G) mobile radio spectrum to firms in an auction that saw companies paying nearly $15 billion to the government, and the state auditor has criticised the government for awarding 2G spectrum for free.

Companies that were given telecoms licences and 2G spectrum in 2008 in turn sold stakes in the ventures to international telecoms firms including Telenor and Etisalat at several times the price they paid for acquiring licences.

The government has asked five companies -- including the Indian ventures of Telenor and Etisalat -- to defend 85 licences granted in 2008 after the state auditor said the firms were not eligible for the licences they were given.

The companies are expected to reply to the government notices by mid-February after which the telecoms ministry will decide whether to cancel the licences.


Sibal said that if the licences are held to be valid, the companies will have to pay for any additional spectrum beyond the 4.4 mega hertz spectrum already given to them.

Older operators such as Bharti and Vodafone Essar, who have been in the market for a long time and have received additional 2G radio spectrum as their subscriber base increased, will also be asked pay for spectrum beyond 6.2 mega hertz, the upper limit in their licence agreements.

"Anybody who has beyond 6.2, will have to pay market price, even existing licence holders," Sibal said.

The state auditor had named eight companies including Bharti, Vodafone Essar, Idea Cellular that were given spectrum beyond 6.2 mega hertz without having to pay for it.

Separately, the sector regulator Telecom Regulatory Authority of India last year recommended that firms pay a one-time fee for 2G spectrum beyond 6.2 mega hertz based on 3G prices, a proposal that drew protests from the older operators.

The regulator has said it will give fresh proposals on pricing of 2G mobile spectrum.

Sibal also said companies' annual revenue-sharing with the government will be uniform under the new policy.

Fifteen mobile carriers in India serve more than 730 million customers and added users at a monthly average of more than 18 million in 2010.

(Editing by Krittivas Mukherjee and Catherine Evans)

Inflation dulls India star, unnerves foreign investors

On Saturday 29 January 2011, 6:07 PM
By Sujata Rao and Ami Shah

LONDON/MUMBAI (Reuters) - Soaring inflation and rate rises are starting to hit corporate margins in India, tempting more foreign fund managers to slash holdings in favour of markets that can better capitalise on the global economic recovery.

With oil and food prices not seen easing in the near future, money managers reckon the exodus has some more months to run.

This January alone, foreign funds have pulled $900 million from Indian equities, Thomson Reuters data shows. This contrasts with the record $29.3 billion they pumped in last year.

So a market that last year returned over 20 percent in dollar terms is down 8 percent this year -- the worst performer of the four BRICs -- Brazil, Russia , India and China - and one of the biggest emerging markets losers so far in 2011.

"The view is India faces a difficult year," says Michael Penn, chief global equity strategist at BoA/ML. "It is the only underweight of the BRICs ... and the size of that underweight is increasing, showing people are becoming more pessimistic."

Underweight positions on Indian stocks have reached 35 percent on a net basis, the most since last April, BoA/Merrill Lynch's investor survey showed in January. Compare that to November when 8 percent of foreigners were overweight India.

There are several reasons why the bulls are forsaking India.

The big one is inflation, with food price rises well in the double digits and a real risk this will spill into the economy. To counter this the Reserve Bank (RBI) raised interest rates this week, for the seventh time since March, to 6.5 percent.

The inflation is rooted in supply-side factors such as bad weather damaging crops and global prices that cannot be fixed by interest rates. But another 75-100 bps of tightening is expected with implications for consumer spending and corporate margins.

"As rates rise, margin pressures start to increase...we are starting to see earnings downgrades come through," Penn said.

While most fourth quarter corporate results have beaten forecasts, seven of ten sectors have suffered margin contraction, a Morgan Stanley survey found this week.

The market is also pricy, trading 20 times 2011 earnings versus 12 times for emerging markets. With gains of 110 percent between end-2008 and 2010, it looked ripe for a reversal.

Michael Konstantinov, who runs $3 billion in BRIC stocks at Allianz RCM, recently pared India holdings in favour of Russia .

"You have the valuations argument, pressure from inflation, and on the monetary side there's rising oil prices. So there are plenty of reasons to reduce your position," Konstantinov said.


If there are push factors from India, there are the pull factors of other emerging -- and even developed -- markets.

Few doubt the long-term potential of India, an economy that is growing at close to 10 percent a year. Plans for $1.5 billion in infrastructure spending and fast-rising middle class incomes underpin the longer-term potential for the market.

But in the short-term, much of Mumbai's current weakness is linked to a turn in the world economic cycle.

With the U.S. recovery finally looking more sustainable, investors are rebalancing portfolios by rotating more cash into Western markets, or to commodity-heavy markets like Russia or South Africa which gain as oil and metals prices rise.

And India is not the only victim. Indonesia, the other big Asian domestic consumption play, did well last year but so far in 2011 is faring even worse than India.

"When markets were worried about world economic growth (investors) were willing to pay a premium for a strongly growing economy but now...they are reluctant to continue that trade," said Arvid Bohm, equities strategist at SEB in Stockholm.

"The question investors are facing is where do you remove cash from?" You remove it from a market where valuations are pricy. Even if earnings are great, that's already in the price."


All this is bad news for India which is increasingly relying on these short-term portfolio flows to plug a current account gap of around 3.5 percent of GDP and likely to widen more under the impact of $100 a barrel oil prices.

But financing the deficit is not expected to be a problem -- the big fear is for growth.

"The fear is the RBI is very hawkish. It could derail the pace of economic growth. So when economic growth is your USP (unique selling proposition) and that comes off, how does one sell?" said Rakesh Rawal head of private wealth management at Mumbai brokerage Anand Rathi.

But bulls are still out there, and any sign that food price pressures are subsiding, should bring them back in, especially as valuations ease. India is also ahead of most markets in the rate rise cycle. Some like Indonesia are yet to start on that path.

"Structurally India is such as exciting story that any correction will see people come back and buy," said David Cornell, fund manager at India Investment Group in Mumbai.

"But what the market wants to see is evidence that inflation is coming back down into the RBI's target range.. we have a little way to go yet."

The RBI'S perceived comfort zone for inflation is 5-6 percent in the short term and 3-4 percent in the medium term.

(Editing by Ron Askew)
Sibal says to make 2G mobile spectrum price market-linked

On Saturday 29 January 2011, 5:05 PM
By Devidutta Tripathy

NEW DELHI (Reuters) - India will de-link second-generation radio (2G) spectrum that now comes free with telecoms licences and ask companies to pay for spectrum based on a market-driven mechanism, the telecoms minister said, unveiling the broad contours of a new telecoms policy.

Kapil Sibal also told reporters bigger telecoms carriers such as Bharti Airtel and Vodafone's India unit will be asked to pay market-linked prices for 2G radio-spectrum beyond 6.2 mega hertz. Such a pricing mechanism is yet to be finalised.

The government's move is seen as a bid to make the world's second-largest and fastest-growing market for mobile phone services more transparent.

The sector was hit by controversy over the awarding of licences and spectrum in 2007-08, sparking a political row in Asia's third-largest economy, with the opposition attacking the government for failing to fight graft.

A state auditor's report that India lost $39 billion in revenue due to irregularities in the grant of licences led to the resignation of then Telecoms Minister Andimuthu Raja.

Sibal, who took over in November after his predecessor quit, has said the government will announce a new telecoms policy this year, overhauling decade-old telecoms rules.

Under the present rules, mobile operators pay a total 16.58 billion rupees ($362 million) for licences in all of India's 22 zones and get 4.4 mega hertz of initial spectrum bundled with the licences without having to pay any additional price for it.

"We think there needs to be a directional shift away from the old policy... We are going to delink the licence from the spectrum in the new dispensation," Sibal told reporters on Saturday.

"Henceforth, spectrum will be awarded, apart from delinking, on a market-based pricing mechanism," he said, adding the price of spectrum would be determined either by auction or through some other process depending on the regulator's proposals.

India last year sold third-generation (3G) mobile radio spectrum to firms in an auction that saw companies paying nearly $15 billion to the government, and the state auditor has criticised the government for awarding 2G spectrum for free.

Companies that were given telecoms licences and 2G spectrum in 2008 in turn sold stakes in the ventures to international telecoms firms including Telenor and Etisalat at several times the price they paid for acquiring licences.

The government has asked five companies -- including the Indian ventures of Telenor and Etisalat -- to defend 85 licences granted in 2008 after the state auditor said the firms were not eligible for the licences they were given.

The companies are expected to reply to the government notices by mid-February after which the telecoms ministry will decide whether to cancel the licences.


Sibal said that if the licences are held to be valid, the companies will have to pay for any additional spectrum beyond the 4.4 mega hertz spectrum already given to them.

Older operators such as Bharti and Vodafone Essar, who have been in the market for a long time and have received additional 2G radio spectrum as their subscriber base increased, will also be asked pay for spectrum beyond 6.2 mega hertz, the upper limit in their licence agreements.

"Anybody who has beyond 6.2, will have to pay market price, even existing licence holders," Sibal said.

The state auditor had named eight companies including Bharti, Vodafone Essar, Idea Cellular that were given spectrum beyond 6.2 mega hertz without having to pay for it.

Separately, the sector regulator Telecom Regulatory Authority of India last year recommended that firms pay a one-time fee for 2G spectrum beyond 6.2 mega hertz based on 3G prices, a proposal that drew protests from the older operators.

The regulator has said it will give fresh proposals on pricing of 2G mobile spectrum.

Sibal also said companies' annual revenue-sharing with the government will be uniform under the new policy.

Fifteen mobile carriers in India serve more than 730 million customers and added users at a monthly average of more than 18 million in 2010.

(Editing by Krittivas Mukherjee and Catherine Evans)

ANALYSIS - Investors face rising risks however Egypt plays out

On Saturday 29 January 2011, 11:22 PM
By Peter Apps, Political Risk Correspondent

LONDON (Reuters) - If President Hosni Mubarak clings to power, investors will reprice Egyptian and regional assets to brace for weeks, months or possibly years of heightened political risk.

If he goes, global markets could still react with alarm, fearing a rising tide of unrest across the Middle East and possibly other authoritarian economies that could threaten energy supplies and potentially global economic recovery.

Mubarak sacked his government after four days of street protest, but made it clear he had no intention of giving in to demands from the street that he stand down. Tanks and troops deployed on the streets face rising numbers of demonstrators.

Egypt is entering uncharted waters, analysts say, and is far from clear how much force soldiers and officers will be willing to use.

Whatever happens, events in Egypt -- coming close on the heels of the overthrow of Tunisia's government by protests that escalated to regime change in less than a month -- have dented previous assumptions of stability.

"Either way, Egyptian risk will be priced up on Monday," said one investment strategist on condition of anonymity." The question now is whether we hit bottom quickly or slowly."

Egypt 's stock market lost 16 percent in two days last week. Along with Egypt 's banks, it should have reopened on Sunday but officials said both would remain closed. The Egyptian pound has fallen to six-year lows.

But the investment ripples looked to be going well beyond the Middle East. Wall Street's S&P 500 index recorded its worst one-day fall in six months on Friday on the unrest.

Egypt has long been seen as a key U.S. ally in the region, and sits astride the Suez Canal through which much of Europe's crude oil and imported goods pass.


Particularly if Mubarak does ultimately go, investors will also be querying the survivability of other regional governments including potentially Saudi Arabia .

The world's biggest oil producer also has an ageing head of state and social divisions, but it also has a colossal wealth from its oil revenue that gives its ruling elite much more flexibility when it comes to effectively buying public support.

"This might affect perceptions of Saudi risk," said John Drake, senior risk consultant at London consultancy AKE.

"Everyone has always said that Saudi will face a crisis eventually -- most likely when they run out of oil, which will not be for a long time. But I'd be much more worried about countries with a bigger wealth gap -- Algeria, possibly Bahrain, Lebanon ."

Yemen -- another key US ally -- has also seen rising protests. Certainly, markets would react badly if it appeared other Middle Eastern countries were also being pushed to the brink of revolution.

So far, while Egypt 's Suez town has seen some of the worst violence so far, there is no reported impact on shipping. Most of the international shipping passing through the canal has already run the gauntlet of Somali pirates further south in the Gulf of Aden and Indian Ocean, so onshore violence in Egypt may have little effect on already sky-high insurance premiums.


Nevertheless, any disruption would send markets reeling. Fuel and food prices are already edging higher, the latter boosted in part by other governments increasing food purchases in the hope of staving off further unrest.

That could boost inflation around the world. Even in Europe heightened cost of living is seen further stoking what are seen as rising protests against austerity and spending cuts.

The broader impact on the Egyptian economy is almost impossible to predict, but will depend on how long unrest lasts. Tourism is almost certain to take a major hit, with February generally seen as one of the most crucial months for the industry.

If Mubarak is successful in what could turn into a brutal crackdown, foreign firms and investors could still be deterred. Aged 82, Mubarak has always avoided naming a successor and another political crisis might be seen all but inevitable.

As Thailand has shown several times in the recent years, concerns over succession -- in the Thai case over the aged king -- coupled with political and social divisions can prove a potent recipe for unrest.

There could also be reputational risks from being seen as too close to Mubarak's government. White House press secretary Robert Gibbs was asked pointedly whether the United States might put pressure on British mobile phone operator Vodafone after it acquiesced to Cairo's demands to shut down services.

All that means that in the short term, investors, firms and others will be focused firmly on what happens on Cairo streets.

HIGHLIGHTS - RBI intends to keep cash in deficit

MUMBAI (Reuters) - The Reserve Bank of India has no current plans to take new steps to ease cash conditions further and it expects an unwinding of the factors contributing to the shortfall in the months ahead, its chief said on Thursday.

The Reserve Bank India (RBI) on Tuesday raised its repo rate , at which it lends to banks, to 6.5 percent from 6.25 percent. It also lifted the reverse repo rate , at which it borrows from banks, to 5.5 percent from 5.25 percent.

The RBI also raised its inflation forecast for the current fiscal year to end-March to 7 percent from 5.5 percent and warned of persistently higher food prices unless steps are taken to boost supplies.

Following are comments by central bank officials at a analyst conference call following the monetary policy review on Tuesday:


"We have maintained in the November policy that we expect to see LAF (liquidity adjustment facility) window in the deficit mode for some more months to come, so that is consistent with our anti-inflationary stance. So, I do not see the possibility of it (LAF) getting into a surplus.

"But, we certainly want it to be in a less deficit than it is now because deficit right now is around 2 percent of net demand and time liabilities and we think that the more appropriate level would be 1 percent and that is where we would like it to be."

"Whether we should do further OMO (open market operation) or any other measure to ease liquidity, we have said that we are not contemplating any of those measures now...

"The reason why we are not doing that is because we have done all that the RBI could reasonably do to ease the liquidity situation and that the frictional and the structural components of the liquidity situation must unwind in the months ahead.

"I think the frictional components (could unwind) through government spending or adjusting its cash balances by taking it forward into the budget and the structural component by banks bringing their credit growth in line with their deposit growth.

"Yes, demand-side pressures are abating because of our monetary policy tightening and perhaps they would have been stronger in the absence of our policy."


"Treasury bill issuances of the government are primarily based on the intra-year mismatches in receipts and payments... these instruments provide investment opportunities for those who have short-term funds and generally the government has not really had any problems raising any funds by way of tbills.

"(From) The FII (foreign institutional investor) investments or exposure to fixed-income instruments what we find is they are mostly short term, their exposures are mostly in less than two-year instruments.

"Since we have a cap on the amount that they can invest, we find that it does not reach this particular ceiling that we have. The very reason that we have a cap, we don't see too much vulnerability coming from that end."

(Compiled by Mumbai Treasury Team; editing by Malini Menon)

Egypt turmoil rattles Middle East stock markets
DUBAI: Investors nervous about instability gripping Egypt drove Middle Eastern stocks down sharply Sunday as markets reopened following a weekend of violent protests. 

The losses, led by a drop of more than 4 percent in the regional business hub Dubai, reflect concerns the unrest that has roiled the Arab world's most populous country and nearby Tunisia could spread, jeopardizing an economic recovery across the region. 

``There's this contagion effect, where investors are thinking: 'Well, is this going to spread out across the Arab world?''' said Haissam Arabi, chief executive of Gulfmena Alternative Investments, a fund management firm in Dubai. 

Egypt's market remained closed because of the protests, leaving investors to pull money off the table elsewhere. 

The benchmark index for the Dubai Financial Market tumbled 4.3 percent to close at 1,543.02. 

Among the biggest losers in Dubai were real estate developer Emaar Properties, the builder of the world's tallest tower, which sank 8.3 percent to 3.11 dirhams (85 cents). Shares of discount carrier Air Arabia, which is growing its operations in Egypt, dropped 6.1 percent to 0.79 dirhams (22 cents). 

DP World, the global port operator, tumbled 6.2 percent to close at 62 cents on the Nasdaq Dubai exchange. The Dubai World subsidiary is heavily dependent on shipping in the Middle East and Africa, including at the Egyptian Red Sea port of Sokhna, which it manages near the southern entrance to the Suez Canal. 

Ann Wyman, head of emerging market research at Nomura in London, said protests in the city of Suez at the mouth of the strategic waterway _ a key chokepoint for cargo ships and oil tankers _ are making investors nervous. 

``You can imagine that it is a top priority in Egypt to keep the canal open, safe and well-protected,'' Wyman said. ``Disruption in the flow of oil is one thing that people worry about.'' 

Other Mideast markets also suffered losses. Abu Dhabi's main index sank 3.7 percent to close at 2,561.06. Shares of the exchange's biggest loser, Emirati natural gas producer Dana Gas, plunged 9.9 percent to finish at 0.64 dirhams (17 cents) despite assurances that its Egyptian operations haven't stopped amid the protests.
Wall Street: Egypt riots spark biggest drop in nearly 6 months
NEW YORK: Stocks suffered their biggest one-day loss in nearly six months on Friday as anti-government rioting in Egypt prompted investors to flee to less risky assets to ride out the turmoil. 

Increased instability in the Middle East drove up the CBOE Volatility Index, the stock market's fear gauge, as investors scrambled for protective positions. 

"The market hates uncertainties, especially geopolitical ones, and based on how that shapes up throughout the weekend (in Egypt), next week's trading will be impacted," said Thomas Nyheim, portfolio manager for Christiana Bank & Trust Co in Greenville, Delaware. 

Trading volume was the highest of the year at 9.97 billion shares on the New York Stock Exchange, the American Stock Exchange and Nasdaq, compared to last year's estimated daily average of 8.47 billion shares. 

The market drop ended the Dow's eight-week winning streak and pushed the S&P 500 below its 14-day moving average for the first time in two months. Disappointing results from and Ford further added to the gloom. 

Developments in the Middle East could be a trigger for investors to sell at a time when many expected a correction after a market rally of about 18 percent since September. 

"I think the next two to three weeks, the crisis in Egypt and potentially across the Middle East, might be an excuse for a big selloff of 5 to 10 percent," said Keith Wirtz, president and chief investment officer at Fifth Third Asset Management in Cincinnati, Ohio. 

Nasdaq quotations for its main stock indexes suffered an outage of nearly one hour at the open, causing confusion among traders. Nasdaq OMX Group blamed a glitch with its global index data service. 

The Dow Jones industrial average ended down 166.13 points, or 1.39 percent, at 11,823.70. The Standard & Poor's 500 Index was down 23.20 points, or 1.79 percent, at 1,276.34. The Nasdaq Composite Index fell 68.39 points, or 2.48 percent, at 2,686.89. 

For the week, the Dow fell 0.4 percent, the S&P lost 0.5 percent and the Nasdaq dipped 0.1 percent. shares slipped 7.2 percent to $171.14, a day after the online retailer recorded revenue below the consensus view. 

Ford Motor Co slumped 13.4 percent to $16.27 after a steep drop in quarterly profit. Rival automaker General Motors Co also lost 5.4 percent to $36.60. 

Dow component Microsoft Corp also fell 3.9 percent to $27.75 a day after its profit dipped. 

In Egypt, President Hosni Mubarak sent troops and armored cars into cities in an attempt to quell street fighting and mass protests, and medical sources said at least five protesters had been killed and 870 wounded.

The VIX settled up 24.1 percent at 20.04. The percentage gain was the largest since May 20. U.S. Treasuries prices and the dollar -- assets considered safe compared to stocks -- rallied. 

U.S. crude futures rose 4.4 percent to $89.43 a barrel as the protests in Egypt threatened Middle East stability. Oil companies with operations in the region were hit, including Apache Corp and Occidental Petroleum Corp. 

Apache shares were down 1.3 percent at $144.84 and Occidental Petroleum fell 3.3 percent to $93.81. 

Equities garnered support from data showing the U.S. economy grew at a 3.2 percent rate in the fourth quarter as consumer spending accelerated. 

Declining stocks outnumbered advancing ones on the NYSE by 2,533 to 484. On the Nasdaq, decliners beat advancers by 2,221 to 413.
Egypt unrest rattles world's markets; Wall St falls from 29-mth highs
NEW YORK: Crude oil prices surged, world stocks fell and the dollar gained on Friday as images of street battles in Egypt riveted investors and raised concerns the protests will intensify and spread across the Middle East. 

President Hosni Mubarak imposed curfews across Egypt. Investors, who had been accelerating moves into riskier assets, sold stocks heavily as they reacted to coverage of street battles between protesters and Egyptian security forces. 

"The crisis in Egypt as well as the significance of a government shutting down the Internet for the entire country is causing major nervousness in market participants that have been long equities in front of the weekend," said Linda Raschke, a partner with Chicago based brokerage firm FuturePath Trading. 

"There is a flight to dollars as well as a flight out of equities. The major benefiting market to the upside is crude oil, capitalizing on the implications for regional instability," she added. 

U.S. crude futures surged more than 4 percent. Traditional safe-haven investments U.S. Treasury debt, gold and Swiss francs benefited from the sudden shift in market sentiment. Gold prices jumped 2 percent. 

"Gold is benefiting more than bonds at this particular point," said Frank McGhee, head precious metals trader of Integrated Brokerage Services in Chicago. "People are looking at gold as a safe haven in times like this, and it's certainly showing it." 

On Wall Street , shares fell from 29-month highs and the CBOE Volatility Index, or VIX, a broad measure of market anxiety, soared more than 19 percent. 

Disappointing results by high-profile companies, including and Ford Motor Co , added to the negative sentiment caused by the turmoil in Egypt. 

Energy stocks declined despite the surge in oil prices as uncertainty over the weekend developments in Egypt and anemic growth in Chevron's oil reserves kept investors jittery. 

The Dow Jones industrial average dropped 157.73 points, or 1.32 percent, to 11,832.10. The Standard & Poor's 500 Index slid 20.56 points, or 1.58 percent, to 1,278.98 and the Nasdaq Composite Index slumped 65.61 points, or 2.38 percent, to 2,689.67. 

"The market response to earnings in Microsoft, Amazon and Ford is disappointing," said Peter Boockvar, equity strategist at Miller Tabak & Co in New York. "Then you throw in Egyptian riots possibly spreading ... we're going into a weekend where anything is possible in Egypt," he said. 

U.S. crude for March delivery ended up $3.70, or 4.32 percent, to $89.34 per barrel on the New York Mercantile Exchange. Spot gold prices rose $25.19 to $1,336.30 an ounce. 

Benchmark 10-year Treasury note yields dropped 0.06 percentage point to 3.33 percent. 

The political unrest overshadowed economic data in the United States that showed a recovery was on track. 

U.S. gross domestic product data for the final quarter of 2010 showed the biggest gain in consumer spending in more than four years, and with strong exports, offered the clearest signals yet that a sustainable recovery is under way. 

Ford tumbled more than 12 percent after reporting a steep drop in its quarterly profit after a charge for debt payments. "Ford results were pretty ugly," said James Dailey, portfolio manager of TEAM Asset Strategy Fund in Harrisburg, Pennsylvania. 

India mulls import duty cuts to curb inflation

DAVOS, Switzerland: India is concerned about high global commodity and oil prices and will consider cutting import duties on more food products to curb inflation gripping Asia's third-largest economy, its trade minister said. 

India is already allowing duty-free imports of crude vegetable oils and is likely to continue to do so as food price rises remain in the double digits, a worry that has prompted foreign fund managers to pull out of the country's equities. 

Asked if India would consider cutting more import duties, Indian Trade Minister Anand Sharma told Reuters late on Saturday at the World Economic Forum in Davos, Switzerland: "Yes, when there is a shortage and the inflation is high." 

"Like where there is a shortage and we don't produce enough, it is but natural (to cut import duties). Why should we import at such higher prices and then subsidize it for the public distribution system?" 

Food inflation in India inched up in mid-January to hit 15.57 percent due to unseasonal rains hitting output of vegetables, such as onions, potatoes and tomatoes -- key ingredients in Indian cooking. 

Analysts are forecasting more interest rate rises by the Reserve Bank of India, which on Tuesday raised policy rates for the seventh time since last March. 

Global crude prices soaring toward $100 a barrel are also another concern, Sharma said, due to worries that India's nagging trade deficit could widen further. 

"Well, everybody would be (worried), especially those dependent on imports," Sharma said. "It has been a matter of concern because in any case, we have a trade deficit." 

India's goods trade deficit has been wide as it needs to import large quantities of iron and steel, chemicals and machinery to fuel a rebound in industrial growth. 

The trade deficit can exacerbate India's current account deficit and adds to the need for India to attract fund inflows to finance the gap. 

Policymakers have said the deficits were a concern but manageable. However, some have said the shortfalls make it easier for India to absorb a surge in inflows of capital -- the product of super-loose monetary policy in advanced economies.

FII stocks, bond investments at Rs 79,000 cr in 2011 so far

MUMBAI: Foreign investors have purchased stocks and bonds worth over Rs 79,000 crore from the Indian capital market in January, 2011, so far, as per data from market regulator Sebi. 

Foreign institutional investors (FIIs), whose investments are often called 'hot money' because they can be pulled out at anytime, have purchased stocks and debt securities worth Rs 79,420 crore during the course of the 19 trading sessions conducted in 2011 so far, according to the latest Sebi data. 

At the same time, FIIs sold shares and bonds worth Rs 72,910 crore, translating into a net investment of Rs 6,509.60 crore. In dollar terms, FIIs have invested USD 1.44 billion on the purchase of Indian stocks and bonds in January, 2011, so far. 

Overseas investors have been gross sellers of equities worth Rs 4,220.80 crore so far in 2011, but were bullish about the debt market, making a net investment of Rs 10,730.40 crore. 

"This year, FIIs have started with a billion dollar mark, inflow has been reduced. They are definitely profit-booking because of factors like high food inflation, rate hike and the negative political scenario in the country," SMC Capitals Strategist and Head of Research Jagannadham Thunuguntla said. 

Echoing a similar view, Geojit BNP Paribas Research Head Alex Mathew said, "Short-term investors are exiting India as they turn negative on macroeconomic conditions, while long-term investors are also cautious over the country. Another reason is that European countries are showing some sign of recovery." 

In 2010, foreign investors bought stocks and bonds valued at nearly Rs 10 lakh crore, a record for a single year. At the same time, FIIs sold shares and bonds worth Rs 7,80,000 crore during the year -- which implied a record net investment of over Rs 1.75 lakh crore for the year. 

In dollar terms, net FII inflows stood at about USD 39 billion in 2010. In 2009, they had infused Rs 83,423 crore in the stock market. 

Significantly, the secondary market barometer, the Bombay Stock Exchange Sensex, has fallen by 2,113.12 points, or 10.3 per cent, in January so far and currently lies below the psychological 19,000 points level.

Investors lose Rs 11 trillion in stock market since Diwali

MUMBAI: Investors have lost a whopping amount of nearly Rs 11,00,000 crore in the stock market in less than three months since Diwali last year, with over Rs 3 lakh crore being wiped out in the past three days alone. 

The stock market today plunged to its lowest level in nearly five months after three consecutive days of fall -- a period during which the benchmark Sensex plummetted by about 755 points, including a 288-point dip witnessed today. 

Total investor wealth, measured in terms of cumulative market value of all listed stocks, today itself fell by over Rs 1,32,000 crore -- taking the loss for past three days to over Rs 3,00,000 crore amid macro-economic concerns emanating from inflationary and governance deficit related factors. 

Experts said that downward pressures in the market extended well beyond the past three days and heavy selling pressure has continued for over two months now, primarily due to heavy outflows by overseas and domestic investors keeping away in the absence of any positive triggers. 

In the process, the total investor wealth has fallen to near Rs 66,00,900 crore -- a huge dip of close to Rs 11,00,000 crore since last Diwali on November 5, 2010, the day when the Sensex scaled its record closing level of 21,004.96 points. 

The Sensex has now fallen to 18,395.97 points -- marking a plunge of over 2,600 points since Diwali. 

So far in 2011, the investor wealth has fallen by nearly Rs 9,00,000 crore, while nearly Rs 2,00,000 crore was lost during the last two months of 2010. 

Experts said that a huge dip in investor confidence is also corroborated by a considerable plunge in the trading turnover at the bourses. 

The average daily cash market turnover at the bourses have fallen to nearly Rs 15,000 crore, marking a decline of over one-third from approximately Rs 23,000 crore in October-November 2010. 

The current level of turnover is not even one-third of the record level of business volume witnessed in mid-2009, when the daily average turnover was close to Rs 50,000 crore. 

The intensity of current downward rally on the bourses can be gauged from the fact that only four stocks out of the 50 top blue-chips that make the Nifty index have given a positive return in the past one month. Even the gains of these four stocks -- namely HCL Tech, TCS, Sesa Goa and PowerGrid -- are only nominal between 0.6-7.3 per cent.

Warren Buffett, Bill Gates to visit India this year

 Two of the world's richest people Warren Buffett and software czar Bill Gates will visit India this year to seek support of wealthy Indians for philanthropic activities. 

Legendary investor Buffett along with Bill Gates and his wife Melinda Gates are leading the 'Giving Pledge' campaign, that urges rich people to pledge at least half of their wealth to charity. 

"In the months ahead, they (Buffett, Bill and Melinda Gates) will visit India and possibly other countries to have similar conversations (on the campaign)," a spokesperson for 'Giving Pledge' initiative told media. 

Details about the proposed visit were not available. According to the spokesperson, Buffett and the Gates, Bill and Melinda, have started conversations with billionaires from other countries to learn about their philanthropy efforts as well as discuss what has worked in those countries. As part of 'Giving Pledge' initiative, the billionaire friends had visited China in September 2010. 

Gates and Buffett had met many "wealthiest business and philanthropy leaders, exchanged ideas and best practices about how to make the greatest impact with philanthropy," during their China trip, the spokesperson said. 

The two billionaires also came across some successful examples of Chinese philanthropy during that trip. Last year, Gates and Buffett were ranked as the world's second and third richest people, respectively, by the Forbes magazine. Gates' wealth was estimated to be worth USD 53 billion and Buffett's was pegged at USD 47 billion.

'Giving Pledge' makes efforts to invite richest individuals and families in the US to commit to giving the majority of their wealth for philanthropic causes, either during their lifetime or after their death. "The Pledge is a moral commitment to give, not a legal contract. It does not involve pooling money or supporting a particular set of causes or organisations," according to its website. 

The initiative has already seen over 50 billionaires, including New York mayor Michael Bloomberg, Oracle CEO Larry Ellison , investor Carl Icahn and media mogul Ted Turner .

BrahMos cruise missile for IAF to be ready by next year

CHENNAI: BrahMos, the supersonic cruise missile for the Indian Air Force, would be ready by next year, a top official said today. 

"BrahMos will be ready for the IAF by next year and the supersonic missile is nine times faster than other missiles in the world", BrahMos Aerospace Chief Executive and Managing Director A Sivathanu Pillai told reporters here. 

On the development of the hypersonic missile that would travel seven times more than the sound, he said the basic technology was being developed. "It will take at least six years", he said. 

The BrahMos Aerospace would also manufacture cryogenic engine for Indian Space Research Organisation (ISRO). "Once the technology gets ready (by ISRO), we will begin doing the engines for them,", Pillai said. 

The ISRO was in the process of developing cryogenic engine to power its Geosynchronous Satellite Launch Vehicles, he said. 

ISRO's Kerala unit was already in the process of making liquid fuels that would power engines, he said. 

BrahMos Aerospace is the brain child of former President A P J Abdul Kalam . It is the joint venture company between India's Defence Research and Development Organisation (DRDO) and Russia's NPO Mashinostroyenia. The aim of the partnership is to design, develop, manufacture and market supersonic cruise missile system.

Karmapa's cash links should be fully probed: Dalai Lama

BANGALORE: The investigations into the source of unaccounted currency seized from the monastery of the Karmapa, Ugyen Trinley Dorje , at Dharmasala in Himachal Pradesh should be thorough, Tibetan spiritual leader Dalai Lama said Sunday. 

"There should be a thorough investigation into the cash dealings of the Karmapa. As he is an important Lama, he has a large number of disciples, including many from China," the 14th Dalai Lama told reporters here on the margins of a public meeting. 

Noting that the 17th Karmapa was an important Lama with a huge following, the 76-year-old Nobel Peace Prize winner admitted that there was some negligence on part of Dorjee in handling the money, which he receives from his followers the world over. 

"The Karmapa also needs money, which he gets from disciples and others. As there has been some negligence in handling it (money), the case has to be investigated," the Dalai Lama said after delivering a discourse on "Finding Happiness in Troubled Times" at the National College grounds here. 

The eminent Buddhist monk, originally known as Tenzin Gyatso, however, declined to comment on the seizure of unaccounted foreign and Indian currency to the tune of Rs.7 crore (Rs.70 million) Jan 27 and the subsequent raids by the police. 

"Police and the authorities concerned are looking into the case. I don't have details as I am here (in Karnataka) since Saturday," the spiritual and temporal head of the Tibetan community said. 

Earlier, denying any link between China and the Karmapa's activities in India, the exiled leader agreed that the cash recovered from the monastery, including foreign and Indian currency, should have been deposited in banks and accounted for. 

Possession of so much foreign currency could put the Karmapa, who is a refugee in India, and his aides in trouble under the Foreign Exchange Maintenance Act (FEMA). 

The Karmapa is the spiritual head of the Karma Kagyu School, one of the four sects of Buddhism. He is considered the third most important Tibetan religious head after the Dalai Lama and the Panchen Lama. 

The Karmapa fled Tibet and sought refuge in India in January 2000. Ever since, he has mostly lived in the Gyuto Tantric monastery in Sidhbari near Dharamsala - the seat of the Tibetan government-in-exile.

Karmapa's replies unsatisfactory, to be questioned again: Police

DHARAMSALA: The state police team which interrogated the 17th Karmapa, Ogyene Trinley Dorjee again at Gyuto monastery ( Siddhbari ) 8 kilomteres from on Sunday afternoon said that it was not satisfied with the replies given by Karmapa to the queries asked by them (police). 

A police team, led by Una's ASP K G Kapoor, arrived at the Gyuto Tantric University and Monastery to question the Karmapa about the hue haul of foreign and Indian currency recovered from his premises during the raids. 

"Fifty questions were asked to the Karmapa and he denied all allegations. He said the money recovered was money given by devotees," Kapoor said. But we are not happy with his replies and he is likely to be questioned again," he added. 

A team of Research and Analysis Wing (RAW) and Intelligence Bureau (IB) from New Delhi also reportedly here to carry out questioning of the Karmapa for his alleged Chinese links. 

Karmapa is under scanner for his possible plan to purchase land and construct a monastery to set-up institutions of Chinese leaning in the region. The IB team is also understood to have seized certain important documents and papers from the monastery. 

Dharamslaa northern range IG, PL thakur said that further questioning of Karmapa could be held as investigations progressing further. He also clarified that there was no restriction on the movement of Karmapa. 

Sources said that Karmapa who was being helped by interpreter on being asked about the sources of money remained tight-lipped and feigned ignorance saying that it was the money of the devotees including currency recovered from the monastery. The interrogation of Karmapa was mainly focused on the source of money and possible Chinese link with the monastery's financial dealings. 

The Karmapa trust has also not reportedly filed any tax returns since 2009 as per the preliminary investigations. 

Meanwhile, the state police also arrested Dharamsala businessman and hotelier K P Bhardwaj and D K Dhar, manager of the Corporation Bank in Ambala in Haryana, were Sunday brought for interrogation to Una, 100 km from the Karmapa's monastery. 

"Bhardwaj was arrested last (Saturday) evening as an unaccounted Rs 1 crore was seized from two of his men on Jan 25 at Mehatpur in Una district," police said. 

DK Dhar, manager of the Corporation Bank in Ambala in Haryana, was also arrested late on Saturday evening for issuing a cash remittance slip of Rs 1 crore to Bhardwaj. 

With the arrest of Bharadwaj (hotelier) and Dhar (banker), five persons had been arrested so far in foreign currency recovery case pertaining to Karmapa monastery. 

The Karmapa is the spiritual head of the Karma Kagyu school, one of the four sects of Buddhism. He is considered the third most important Tibetan religious head after the Dalai Lama and the Panchen Lama. The Karmapa fled Tibet and sought refuge in India in January 2000. 

Indian students in US radio-tagged; angry govt says remove it

WASHINGTON: More than a dozen Indian students from among hundreds who have been scammed by a dodgy university in California have been radio tagged with tracking devices in an action New Delhi described as "unwarranted," and asked to be removed even as angry community activists said it is a violation of their rights and dignity. 

Authorities from the Immigration and Customs Enforcement (ICE) who interrogated scores of Indian students who were evidently conned by the sham Tri-Valley University in Pleasanton, California, left radio tracking devices on the ankles of several victims. The students said officials told them the devices, fitted with GPS technology , were meant to keep track of their movements while the administration examined their cases. 

Scores of Indian students, mostly from Andhra Pradesh, are caught up in a scam in which the dubious university allegedly helped foreign nationals illegally acquire immigration status. Investigations by U.S authorities found that while students were admitted to residential and on-line courses of the university and on paper lived in California, in reality they worked illegally in various parts of the country as far as Maryland, Virginia, Pennsylvania, and Texas. 

The students say they were unaware of the dodgy nature of the university and they were conned. In a petition to the Secretary of Homeland Security and the Director of ICE, the affected students said they registered in the university believing it is a "bonafide and legitimate university that had been registered with the Student and Exchange Visitor Information System (SEVIS) database." 

SEVIS is a web-based technology maintained by the U.S to track and monitor schools and programs, students, exchange visitors and their dependents, while they are legally enrolled in the US education system. Indeed, Tri-Valley University is among the SEVIS Approved Schools listed on the US ICE website. Authorities have since shut down the university. 

But US officials say some of the students obtained their visa fraudulently and others are in violation of their visa and immigration status. Such students have been have been placed under ISAP (Intense Supervision and Appearance Program) by ICE and put in removal proceedings, necessitating radio tagging. Not all students have been tagged. 

Foreign students typically come to U.S under the F-1 visa and are generally not permitted to work except for 20 hours a week or less of on-campus employment. 

"US Immigration and Customs Enforcement (ICE) is responsible for enforcing the nation's immigration and customs laws. If ICE encounters individuals during the course of an investigation who are found to be in violation of their immigration status, the agency will take follow-up action consistent with the agency's enforcement priorities," ICE spokesperson Lari Haley said. "Those priorities include persons who've overstayed or violated the terms of their visas, and those who have exploited the nation's legal immigration system by gaining their status through fraud." 

But New Delhi is not happy with students being treated like criminals. Expressing "serious concern," a government spokesman said India has conveyed to the US authorities that the students, "most of who are victims themselves, must be treated fairly and reasonably, and that the use of monitors on a group of students, who were detained and later released with monitors in accordance with US laws, is unwarranted and should be removed." 

The spokesman said students should be given ample opportunity to clarify their position and present their case; those who wish to return to India should be allowed to do so voluntarily; those students who have not violated any visa or immigration laws should be given opportunity to adjust their status; and, those who are eligible to seek transfer to other universities should be given adequate opportunity and time to do so. 

The spokesman said India had also asked the US Government to "provide us full information on the affected students and keep us informed as the investigation unfolds, as well as, on the action being taken against the promoters of the university and others involved in perpetrating the fraud." 

On Friday, ICE announced that it had set up an email address and voicemail that Tri-Valley students can use to contact ICE Homeland Security Investigations directly with their questions. Affected students can call the US number 415-844-5320 and leave a voice message and an ICE representative will return the call. Students can also write to SFRHSIFraud@dhs.Gov seeking help. 

Incidentally, several members of the Union Council of Ministers, including external affairs minister SM Krishna, studied in the US.
Indian students of 'sham' US varsity launch petition campaign
WASHINGTON: Facing the prospect of deportation following the closure of a "sham" university in California, hundreds of its Indian students have launched a campaign to seek help from the US authorities. 

Indians, mostly from Andhra Pradesh, make up about 95 percent of students of Tri-Valley University in the Silicon Valley, which was shut down after US authorities charged it with selling student visas to anyone willing to pay. 

"We respectfully plead with you not to penalise us or our families and bring shame to our entire family and the village/towns we come from, by deporting (removing) us from the US," the students said in the petition to the Department of Homeland Security. 

This would also cause them "loss of name, reputation, money, resulting in devastation to us and our families and crashing all of our dreams," says the petition, a copy of which has been posted on the website of the Telugu Association of North America (TANA). 

TANA president Jayaram Komati said he has been talking to and has also met local Congress representatives from California and urged them to help ensure that the affected students are given a chance to enrol in other institutes of higher learning within the US. 

The organisation has also asked a law firm to approach Student and Exchange Visitor Information System (SEVIS) to help save the affected students from potential deportation and/or detention and argue that they were victims and that they be given the opportunity to enrol elsewhere. 

Meanwhile, a group of 35 students from Tri-Valley University (TVU), claiming they have not violated any law, met Indian Consul General Sushmita Gongulee Thomas in San Francisco Thursday and the government help to complete their studies. 

Thomas said she had sought factual position from the US government on the status of these students and how these students can be helped in transfer to other colleges so that they can complete their studies. 

According to a federal complaint filed in a California court last week, the sham university " admitted students to various residential and on-line courses. 

On paper the students lived in California, but in reality they "illegally" worked in various parts of the country as far as Maryland, Virginia, Pennsylvania, and Texas.

Immigration fraud: Indian consulate comes to rescue duped students in US

NEW DELHI: The Indian consulate in San Francisco has come to the rescue of hundreds of Indian students who are facing deportation from the US after the university they were enrolled with was shut down on charges of illegal immigration. 

The students, mostly from Andhra Pradesh, landed in trouble over their visa status after the US custom enforcement department raided and shut down Tri-Valley University in Pleasanton, Silicon Valley . The university, which faces charges of massive immigration fraud , had around 1,500 students on its rolls, 95% of whom were Indians. 

"We have been individually checking documents of the students, many of whom have approved F1 student visas," said Anu Peshawaria, Silicon Valley-based immigration attorney and legal advisor to the Indian consulate in San Francisco. "In such cases, they are not party to the immigration scam and might be granted a 30-day grace period to change to other colleges or other visa categories." 

But staying on in US may not be easy for those students who started working there despite being on F1 visas. "Students who went to the US on F1 student visas should not be working there under any circumstances," said Mumbai-based immigration lawyer Poorvi Chothani. 

"Now that the Tri-Valley University has been shut on charges of fraud, all its students will lose their visa status. But for those who are illegally working, things are far more serious. They will face deportation and criminal proceedings and could even be barred from receiving US visas for life." 

Chothani is of the view that there are agents based in Andhra Pradesh, who may have been in collusion with the Tri-Valley University. 

"Such agents will now come under scrutiny of the US embassy in India. It is shocking that such a massive fraud was being carried out despite strict audits by the US authorities. In future, student visa applicants from India, particularly from the consulates of Hyderabad and Chennai, are likely to face greater scrutiny," she added. 

In a recent interview with ET, James W Herman, minister, counsellor for consular affairs at the US embassy in Delhi, had expressed concern over a large number of fraudulent visa applications under various categories from Andhra Pradesh, Gujarat and Punjab. 

"The US is a big draw for people from these states and submission of fraudulent documents for visas is very common," Herman said. "We deploy more resources in our consular posts, such as Chennai and Hyderabad, to scrutinise various documents including student I-20 forms very carefully." 

Meanwhile, Murthy Law Firm, which has offices in Maryland, Chennai and Hyderabad, has been receiving phone calls and enquiries from many students of Tri-Valley University. 

"We have received verification that some of these students have been detained and placed under removal proceedings. In this situation, they need to immediately obtain qualified legal representation," a representative of the firm said. The firm is advising students to look into the option of enrolling with other colleges, if they wanted to remain in the US. 

Immigration fraud: Hundreds of Indian students may be deported from US

WASHINGTON: Hundreds of Indian students , mostly from Andhra Pradesh , face the prospect of deportation from the US after authorities raided and shut down a university in the Silicon Valley on charges of a massive immigration fraud . 

The Tri-Valley University in Pleasanton, a major suburb in San Francisco Bay Area, has been charged by federal investigating authorities with being part of an effort to defraud, misuse visa permits and indulge in money laundering and other crimes. 

According to a federal complaint filed in a California court, the University, which was raided and shut down last week, helped foreign nationals illegally acquire immigration status. 

The university is said to have 1,555 students. As many as 95 per cent of these students are Indian nationals, the complaint said. 

Investigations by Immigration and Custom Enforcement (ICE) found that while students were admitted to various residential and online courses of the university and on paper lived in California, in reality they "illegally" worked in various parts of the country as far as Maryland, Virginia, Pennsylvania, and Texas. 

ICE has called it as a "sham university." The ICE investigations found that more than half of these students were reported to be residing in a single apartment located in Sunnyvale California. 

During the course of the investigation ICE found that the university gave the residential address of its students in order to conceal that they did not live in California, said the court papers. 

For a student to maintain an active immigration status, they must show proof that they are making reasonable process towards completing coursework and physically attend classes. 

Federal investigating authorities are now sweeping out on each of those students, who paid lakhs for obtaining students visa and also students work permit. 

Several of them have been interrogated, creating a panic reaction among the Indian student community. 

Many of the students from Andhra Pradesh, who were planning to join the university for the new semester, have cancelled their US travel plans. 

Classes were scheduled to start on January 10 after the winter break. 

It is understood that many of these students are planning to leave the country as soon as possible as they are being interrogated. 

There are unconfirmed reports of some of the students being detained and deportation process has been started against them. 

Once the university has been shut down, the students who come on F-1 visa, lose their status within a stipulated time. These students have been making desperate calls to Indian- American immigration attorneys. 

"We have received verification that ICE has detained some of the students and placed them in removal proceedings," Murthy Law Firm, a popular immigration attorney firm among Indian-Americans, said in a posting on its website. 

On January 20, 2011 the Murthy Law Firm received numerous phone calls from students registered at Tri-Valley University in Pleasanton, California, it said in its posting. 

'Indian franchise sector needs regulation'

NEW DELHI: The estimated Rs 75,000 crore Indian franchise sector is hampered by lack of legislations, which creates hurdles for FDI in the sector and the government should take steps to redeem this in the upcoming general Budget, consultancy Franchise India said today. 

Franchise India, one of the pioneers of the sector in the country, added that a set of laws will also make the sector more transparent and help business to grow by 50 per cent annually from the current 30 per cent. 

"Presently, franchising has no regulator in India and is not governed by any legislation, unlike other developed countries which not only have legislation but also a code... India is losing huge amount of FDI in absence of legislation for the franchising industry," Franchise India President Gaurav Marya said. 

He said the franchise sector is growing annually at around 30 per cent. 

"With proper rules in place, we could see growth going up to 50 per cent," Marya said. 

The Indian franchising sector is the second largest in the world and retail and education are its main components. 

There are over 1.5 lakh registered franchisees in the country. 

India, among some other countries, have certain rules which make entry of foreign players difficult in the retail and education markets. 

The government allows only up to 51 per cent FDI in single-brand retail, while foreign investment is prohibited in multi-brand retail segment. 

Many global players, therefore, opt for the franchise route under which the franchisee owns the business whilst the franchisor takes a share of the profits. 

Franchise India has asked the government to make special provisions for franchise financing as a separate category, on lines with regulations for financing of SMEs by banks. 

"In the absence of regulation, the confidence of franchising investors in low. Legislation will make franchising transparent," Marya said, adding that in the absence of proper legislation the sector faces lack of standardisation in its operations. 

In countries like the USA, franchise agreements involves a draft that is duly filled and scrutinised by the government and both parties -- the franchisee and the franchisor -- are liable to operate within a certain set of laws. 

"This sort of structure and a well covered procedure is lacking in India and that makes the foreign players vulnerable," senior partner as law firm Anand & Anand said. 

In India, major brands like Jockey and Dominos already operate franchise operations, while global players like coffee chain Starbucks and footwear brand Footlocker are presumed to be exploring the option to enter the market here.

Orissa asks Rs 2085 crore in the coming railway budget

BHUBANESWAR: Claiming to be a victim of negligence in Railway budgets, Orissa government has demanded an allocation of at least Rs 2085 crore for the state in the current financial year for various railway projects against the demand for Rs 1805 crore in the last fiscal. The projects include new rail links, extension of existing rail links, improvement in passenger amenities, introduction of new trains and increase in frequency of trains. 

Last year the Naveen Patnaik government cried foul play from the railways' raw deal when the state got only about Rs 836.64 crore including Rs 430 crore for completion of the ongoing new lines and Rs 421.73 crore for doubling of the tracks. Mr Patnaik has been seeking a special railway package for the state in view of the fast pace of industrialization. 

This time, the state government has sought Rs 250 crore for the 82 km long Paradeep-Haridaspur rail link, Rs 350 crore for the 289 km Khurda Road-Bolangir rail link, Rs 150 crore each for the 90 km Angul-Duburi-Sukinda Road rail line and 154 km Talcher-Bimalagarh (rail line and Rs 60 crore for the 56 km Lanjigarh Road-Junagarh rail link. Similarly, the state has sought Rs 20 crore for the gauge conversion of 89-km Rupsa-Bangriposi and Rs 30 crore for the 90-km Nuapada-Gunupur. 

As presently some 20 doubling projects are under execution in order to further augment line capacity the state government has requested the Ministry of Railways to allot Rs 760 crore. It called for allocation of funds for the second bridge on Kathajori and Kauakhai and Haridaspur-Jakhapura (third line). 

The state has sought Rs 100 crore for electrification works besides requesting the ministry to sanction funds for the development of multi modal logistics parks and container freight stations at Kalinga Nagar, Angul, Jharsuguda, Rourkela and Choudwar. 

The state has sought some new rail links in 2011-12 to further intensify industrialization process. These include Rupsa-Burhamura-Chakulia (35 km), Nuapada-Gunupur-Theruvali (79 km), Banspani-Barbil (15 km), Bhadrachalam Raod-Malkangiri-Jeypore-Junagarh-Lanjigarh Road-Talcher-Bimlagarh, Bargarh-Nuapada via Padampur (120 km), Talcher-Gopalpur (245 km), Puri-Konark (35 km), Rupsa-Bangriposi-Gorumahisani (35 km), Badampahar-Keonjhar (70 km), Berhampur-Phulbani (169.8 km) and Khurda Road-Rajathgarh (59 km). 

This apart, it has mooted a proposal to set up a dedicated industrial corridor to be co-habited by multiple users in the Meramandali-Angul-Talcher-Chhendipada belt linking the coal mines, power generating units and steel plants at estimated to cost Rs 2192 crore. The state government has requested the Railways ministry to finalize the policy to construct such dedicated rail corridors in coal and mineral bearing areas. 

The state has also given proposal for introduction of 16 new trains besides seeking Rs 25 crore for five new coaching terminals and Rs 50 crore for seven 'Adarsh' stations (model stations) and two multi-functional complexes.

Chandigarh: City for 500,000 now has 800,000 vehicles

CHANDIGARH: When French architect Le Corbusier designed the modern city of Chandigarh in the 1950s, it was supposed to cater to a maximum population of 500,000 residents. Six decades on, this twin capital is still the 'City Beautiful', but houses almost 1.2 million people with 800,000 registered vehicles and an estimated 100,000 driving through every day. 

In the 2001 Census, the population stood at 900,914. 

With urban planning for Chandigarh not keeping pace with the growth of vehicles in the 114 square km city, a union territory which is also the joint capital of Punjab and Haryana states, congestion, chaos and accidents have become the order of the day. 

Officials at the Registering and Licensing Authority (RLA) say that over 125 vehicles are added to the city's roads every day. And up to 40 percent of them are cars and other four-wheelers. 

"Our workload has increased many times in recent years. Despite more windows for registration of vehicles, the rush is never-ending," an RLA official told IANS. 

In 2010, 45,481 vehicles were registered in the city, the highest number registered in a single year. The figure was much less in previous years, 37,967 (2009), 33,577 (2008), 33,256 (2007), 33,777 (2006) and 29,697 (2005). 

"Normally one registration series (9,999 numbers) gets over in three-four months. However, the CH-01-AE series got over in just one month in December," the RLA official said. 

Besides the over 786,000 vehicles registered in Chandigarh so far, traffic officials of the Chandigarh police say that the city gets a floating population of nearly 100,000 vehicles from adjoining suburbs of Panchkula (Haryana) and Mohali (Punjab). In addition, scores of vehicles come from adjoining states of Punjab, Haryana and Himachal Pradesh. 

"The ever-increasing number of cars and other vehicles is leading to a lot of chaos on the roads, parking lots and even in residential areas. It seems that the city's planners are just sleeping. No one is bothered about managing things now. Everything will just explode one day," Sanjiv Tewari, a retired senior officer of Panjab University , told IANS. 

In a majority of the city's parking lots, including the paid parking zones, finding space to park a car leaves one harassed. Getting in and out of parking areas is an obstacle too with haphazardly parked vehicles. 

"People many times park their vehicles wrongly. This leads to chaos and even fights. If we tell them to park properly, they argue with us and don't listen," said Swaran Singh , who mans a parking lot in Sector 35. 

Chandigarh residents don't have a craze for cars and other vehicles alone. They are equally crazy about car registration numbers. VIP registration numbers in Chandigarh go for hefty prices. 

In recent years, the number '0001' in different registration series has been auctioned at prices ranging from Rs.3 lakh to Rs.10 lakh. 

"People here buy VIP numbers like 0001 and others at prices at which you can buy a small or even a mid-segment and a luxury car. This is crazy," said entrepreneur Harman Singh .

CEOs see infra woes in India threat to growth: PwC

DAVOS: As India tries to embark on a double-digit growth path, many CEOs feel that inadequate basic infrastructure could hamper country's economic expansion programme, says a global survey of consultancy firm PwC. 

"... 88 per cent of CEOs (in India) told us the inadequacy of basic infrastructure was a threat to growth," said the PwC report, which was released at the World Economic Forum (WEF) here. 

The findings are part of the survey which is based on responses from 1,201 chief executives from 69 countries. A majority of those surveyed opined that government leadership in building infrastructure is critical for ensuring competitiveness of countries. 

India, one of the fastest growing economies, plans to invest as much as USD 1 trillion in infrastructure in the five-year period from 2012 to 2017. Nearly half of the investment is expected to come from the private sector.

A recent WEF report said that annually USD 3 trillion needs to be spent on infrastructure development worldwide. 

India is likely to achieve about 9 per cent growth rate during 2010-11 and is aiming to breach the double-digit barrier in the coming years. 

Meanwhile, about 70 per cent Indian CEOs, who participated in the survey, believed that their company's total tax contribution would rise since their government is exploring ways to bring down fiscal deficit. 

The report noted that "70 per cent and 63 per cent of CEOs in India and Brazil,respectively," felt that their tax contribution would rise. 

Going by the survey, about 15 per cent CEOs opined that they would source their supplies from India, considering the country's cost competitiveness. 

On the other hand, as many as 84 per cent of respondents said they have changed their company's strategy in the past two years, primarily due to divergence in the global economy. 

When it comes to growth, 92 per cent of Western European CEOs expect growth in their Asian operations, while only 48 per cent expect growth in their Europe operations. 

"... CEOs from Asia-Pacific and Latin America were more likely to expect growth in their own regions than elsewhere," the report noted. 

As per the survey, two-thirds of CEOs believed they are facing a limited supply of skilled candidates, especially as they establish a long-term presence in key emerging markets. 

"CEOs are changing their people strategies to improve employee engagement and retention. Most CEOs (65 per cent) say they plan to use more non-financial rewards," the report said.

Kamal Nath to focus on housing, transport

The new minister of urban development , Kamal Nath, says he views urbanization of India as a big challenge. Nath, who has been moved out of the ministry of road transport and highways in Wednesday's reshuffle, said he did succeed in building a momentum in India's road construction. In an exclusive interview on his first day, Nath spoke to Deepshikha Sikarwar about his plans and priorities. Excerpts: 

From commerce & industry to roads, and now urban development . Do you see a pattern in this movement? 

Road development was seen as a big challenge when I took over that ministry. I have left more than 20,000 km of work in progress. We achieved 12 km a day of road construction . Therefore, momentum has been created there. 

Challenges of urbanization are unprecedented in India. The challenges are evident if you look at the sheer numbers. There are more than 500 million people living in cities. Economic contribution of urban centres to the national GDP (gross domestic product) is 60%. This is expected to go up to 75% of GDP in the next decade. So, the link between economic performance and urbanization is only getting stronger. It is a challenging task to look at urbanization in India. 

How do you plan to decongest cities? 

This is just my first day. I will have a plan in some time. Definitely, a new outlook and a new vision is needed to tackle challenges related to urbanisation . All our cities are exceeding their carrying capacity. Parking, water, sewerage systems have become a challenge in view of the fast progress made by the country. All these issues need to be addressed effectively . I would involve all sections - the civil society, NGOs and resident welfare associations -- to find ways to improve urban infrastructure. 

Housing is a big issue in cities. How would you address it? 

There is a huge gap in demand and supply in housing. The land prices are going up in cities. Land supply has to increase. I will look at all the issues concerning supply. There is a need for the expansion of NCR zone, expansion of cities with all facilities so that people feel proud of their cities . There is already a proposal for a regulator for the real estate sector. I plan to give it a huge push. I will also take steps to see how private sector could be involved in building affordable houses for the poor. 

Public transport system in most cities is abysmal. How do you propose to go forward? 

Urban transport is a big challenge today . It deserves priority. Underground and other transport facilities have to expand rapidly in all urban centres. Public transport facilities have to grow in tandem with the country's growth. I would ensure that Delhi Metro's network goes up to 415 km by 2017 and it becomes bigger than London metro.

Govt hopeful of Rs 1,000 cr investment in NE by pvt sector

NEW DELHI: The Government today said it is hopeful of over Rs 1,000 crore investment proposals for the northeastern region with the private sector willing to invest in areas like infrastructure and hospitality. 

"After the sixth summit on investment in the northeastern region, we are hopeful of investment proposals to the tune of Rs 1,060 is a good beginning," Minister of Development of Northeast Region ( DONER )) B K Handique told reporters here. 

He said private investors have shown interest in areas like infrastructure, hospitality, education and agro-based industries at recently held trade summit in Mumbai. 

Referring to the security concerns expressed by investors, Handique said government has assured them of full security. 

"There is a concern at the back of their mind on the political situation in the region. Acquiring land is also an area of concern. But it is not a big issue," he said. 

He said there are plans to hold a border trade summit in Shillong between Meghalaya, Tripura and Bangladesh.

There have been proposals for joint ventures from the Bangladeshi side and transit rights but the government is yet to take a view. 

He also said Bhutan's national carrier Druk Air is planning a flight between Paro and Guwahati and wants inclusion of Arunachal Pradesh in the flight route to attract tourists for the proposed Buddhist circuit in the region. 

The minister said there were also plans to include mineral-based industries and mining as permanent chapters in the investment summit in the future. 

There is a proposal from the private sector on setting up of a five-star hotel in Guwahati, he said. 

Handique said the Nagaland government has also offered land in Dimapur for industrial projects

Government to court private and foreign investors to help build cities

NEW DELHI: India will reach out to private and foreign investors to help build its rapidly expanding cities through public-private parternships (PPPs), the newly appointed minister for urban development said on Thursday. 

The move forms part of the government's aggressive push to sell its infrastructure story as an enormous opportunity for the private sector to help overhaul India's crumbling infrastructure, with a planned spend of $1.5 trillion over a decade to 2017. 

India's cities are already among the most populous in the world and expanding at blistering rates. But under-investment and lack of planning have resulted in a legacy of clogged roads, power shortages and irregular water supply that may threaten the growth momentum of Asia's third-largest economy , analysts say. 

The urban development ministry is not seen as a high-profile one, but it may change under minister Kamal Nath, a ruling party heavyweight credited with injecting momentum and much private sector interest in his old job in charge of road building. 

"We need to introduce PPP model in urban infrastructure also and create a partnership of people in private finance," Nath told Reuters. 

"With 8-9 percent growth which we have in the country, we have to facilitate the creation of economically vibrant, inclusive, efficient and sustainable urban habitats." 


Nath said India may sell a stake in state-owned National Buildings Construction Corp (NBCC), the country's largest state-run construction company. 

NBCC, which had an annual turnover of about Rs 3000 crore ($660 million) in 2009/10, is among those companies in which the government proposes to sell stake in the next financial year. 

Separately, Nath told reporters earlier on Thursday that he might introduce an independent regulator for the real estate sector. 

India needs to spend $1.2 trillion by 2030 to meet the projected demand of its cities, a McKinsey Global Institute Report showed last year. There will be 590 million Indians living in cities by then, nearly twice the current population of the United States. 

Kamal Nath was shifted from the Road Transport ministry as part of Prime Minister Manmohan Singh's low-key cabinet reshuffle on Wednesday. 

Seen as a dynamic minister who went to great lengths to attract private money for road contracts, he also sparked some criticism by failing to build 20 kilometres of roads a day, a target he announced with much bluster at the start of his tenure. 

Companies such as Indian conglomerate GMR Infrastructure , which builds and manages airports, roads and power plants in India, could see enormous benefits if Nath starts a more aggressive push towards private-sector involvement. 
India considering infrastructure debt fund options: Fin min
NEW DELHI: India is considering various options to create infrastructure debt funds, a statement issued by the finance ministry said on Wednesday. 

India plans to spend $1.5 trillion over 10 years to revamp its creaky infrastructure, which is seen as a brake on its economic growth. 

India's Planning Commmission has proposed setting up an $11 billion infrastructure fund and there may be a separate fund also for power generation.
Govt gives extra time to 20 SEZ developers to execute projects
NEW DELHI: The government has given more time to 20 SEZ developers, including Tata Consultancy Servicesand Mahindra World City, to execute their projects. 

At a meeting on January 14, the Board of Approval (BoA) headed by Commerce Secretary Rahul Khullar also allowed four SEZ developers to surrender their projects. The BoA is a 19-member inter-ministerial body that deals with Special Economic Zones (SEZs) and related issues.

However, the developers surrendering their projects have to obtain a certificate from the respective Development Commissioners that "they have refunded all the tax/duty benefits availed under SEZ Act/Rules," a senior Commerce Ministry official said. 

SEZ developers, including Medicaps IT Park Pvt Ltd and State Industrial Development Corporation of Uttarakhand, had approached the BoA to surrender their projects. They have cited global economic uncertainty as the reason for quitting their export-focused projects. 

"It will not be financially feasible to develop the SEZ due to ongoing uncertainties in the global economy," one developer that had requested the withdrawal of approval for its IT/ITeS SEZ in Maharashtra said in its application. 

"... Due to the present market scenario, it does not seem possible to implement the project," Medicaps IT Park Pvt Ltd said in its request. 

According to an industry expert, uncertainty over whether new SEZs will be eligible for tax exemptions, which are proposed to be confined to existing units in the latest draft of the Direct Taxes Code Bill, has dampened interest in the enclaves. 

The developers that got more time to implement their projects include Genpact Infrastructure (Jaipur) and Tata Consultancy Services Ltd for their IT/ITeS zone in Rajasthan and Andhra Pradesh, respectively. Parsvnath SEZ Ltd also got one more year to develop its biotechnology SEZ for in Andhra Pradesh. With this, over 200 SEZ developers have got additional time to implement their projects. 

The BoA also approved three new proposals, including one from Mahindra World City (Jaipur) Ltd, to set up SEZs. So far, 580 SEZs have been formally approved by the BoA, of which 114 are in operation. SEZs have emerged as major sources of attracting investment and increasing exports. 

SEZs contributed 35 per cent to the country's exports revenue in 2009-10. Exports from these zones stood at Rs 1,39,841 crore in April-September, 2010-11, as against Rs 89,750 crore in the same period last fiscal. Shipments from SEZs increased from Rs 22,840 crore in 2005-06 to Rs 2,20,711 crore in 2009-10.


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India's green obsession makes Rajan see red
Shyamal Majumdar / Davos January 28, 2011, 14:32 IST

Raghuram Rajan, honorary economic advisor to the Prime Minister, today said India should not follow the US "blindly" on environment.

"Environment protection is important, but the question is whether you can stretch it beyond a point. At this stage of its development, India needs factories as well," he said at a session on 'How will India grow faster than China?"

The comments of the Eric J Gleacher Distinguished Service Professor of Finance at the University of Chicago's Booth School of Business are important in the context of the controversy surrounding the environment ministry's rigid stand on giving clearance to many industrial projects.

Referring to Rajan's concerns on pushing the environment agenda too far, Planning Commission Deputy Chairman Montek Singh Ahluwalia said opinions like these are welcome as India is seeing the early stages of debate on sustainability issues. On one side are non-government organisations (NGOs) who think environment protection is a costless exercise, and on the other is the opinion whether India is being over-protective and pushing the environment agenda too far. "You can expect transparent policies after deliberations," he said.

In this context, Ahluwalia talked about the use of technology and innovation which can go a long way in environment protection. Giving the example of Chotukool, a nano refrigerator developed by Godrej & Boyce for the rural markets, Ahluwalia said such frugal engineering is the way to go. Chotukool is compact, cheap and it does not use electric power. Responding to the constraints of reliable power in India's villages, Godrej created an easy-to-use, energy-efficient, battery-operated refrigerator.

Essar Group Chief Executive Prashant Ruia did not refer to the environment ministry's stand, but said while he sees a long runway for India's manufacturing sector, India Inc's accessibility to natural resources is a big concern. "You need domestic sources of raw material ad hence access to the country's natural resources is a necessity," Ruia said.

The discussions were moderated by Martin Wolf, chief economics commentator,Financial Times.

Responding to questions on the other key challenges that the Indian economy faces, Rajan said the fiscal deficit, mounting debt, quality of spending, archaic laws and inflation threatening to touch double digits were the danger signals. "We must take corrective action to ensure that the economic growth rate doesn't slip back to the Hindu rate," Rajan said at a session on "How will India grow faster than China?"

He agreed with Ahluwalia's view that some corrective actions are required to avoid a situation where Brazil found itself in. "History is replete with examples of economies hitting a brick wall after sustained stupendous performance. Brazil's economic growth, for example, touched 2 per cent after sustained double digit rates," Ahluwalia had said.

Rajan said talent shortage — not necessarily at the very top — is another huge area of concern. "We're running out of electricians and plumbers because our education system is not keeping pace," he added.

On his part, Ahluwalia said these are important issues, but he was confident about India's economic growth staying on course. While admitting that India has to get its act together on infrastructure, Ahluwalia said he expects half the investments in infrastructure projects to come from pubic-private partnerships in the next five years. The share last year was just 13 per cent.

On inflation, Ahluwalia said that is the "least of his worries" as he expects inflation to come down to 7 per cent by the year-end, a sharp decline from the double-digit levels last year due to unseasonal weather.

On his part, State Bank of India Chairman O P Bhatt said a comparison between India and China is not fair as the latter started its industrialisation drive at least 15 years before India's. "China's infrastructure is already 10 times bigger than us, and yet they are talking about investing at least two times our outlay," he said.

Bhatt wondered whether India's growth rate is sustainable at a time when the rich is getting richer and the poor is getting poorer, and advocated quick action in areas such as agriculture as 40 per cent of the produce is still getting wasted.

He also talked about the need to increase the size of India's banks so that they can take part in the growth story more meaningfully. "We need to be at least five times bigger than the existing size," he said.

India - Infrastructure Introduction



India initiated an ambitious reform programme, involving a shift from a controlled to an open market economy showing signs of overheating because of basic infrastructure constraints, both physical and human. So far, the bulk of infrastructure was in the public sector. Public sector in India operating in a protected set up has been largely subsidised by the Government. Since the launching of reform, Government 

is trying to reduce its borrowing which means that further subsidization will not be possible. There is one area where there is a need for private sector and foreign investment to come in. Because of the long gestation period, and many social implications, the infrastructure sector compares unfavorably with manufacturing and many other sectors. For this, specific policies in this area are need to make infrastructure attractive. Clearly, there is a wide gap between the potential demand for infrastructure for high growth and the available supply. This is the challenge placed before the economy, i.e. before the public and private sector and foreign investors. This can also be seen as an opportunity for a widening market and enhanced production.


According to the India infrastructure Report (IIR), currently 5.5 percent of the GDP is invested in the infrastructure sector. This needs to be increased to 7 percent within the next three years and 8 per cent by 2005-06, by which time the annual level of investment in infrastructural facilities is projected to treble or rise even more, from the current level of Rs. 6000 billion (US$52 billion) by 2005-2006.

The total infrastructure investment requirements for the next five years again have been estimated in the report at about Rs. 4000-4500 billion (US$ 115-130 billion).

The task of finding such large amounts and thereafter deploying them productively calls for a close partnership between the public and private sectors, with a vital role reserved for foreign capital. To finance this large short fall, the domestic saving rate needs to be increased by a minimum of 26.7%. besides this has to be supplemented at the margin by FDI. However, this "margin is indeed very important since the role of foreign investment has to be read not only as a gap filler between saving and investment but also as a means for bringing better technology and management.

Further, for filling this gap, the ODA flow may not be very helpful in future, given the aid weariness of most developed countries. Hence, FDI may prove to be the prime substitute. But a sustained FDI inflow would call for the creation of a fair, open and rational tariff structure. Besides, the availability of critical infrastructure base is also becoming an essential precondition.  The projected net foreign investment inflow includes both foreign direct and portfolio inflows. This will entail an increase from the current US $ 4-4.5 billion to about US $ 9-10 billion by 2000-01 and US $ 15-16 billion per annum by 2005-06. IIR's expectation is that about 40 per cent of external capital inflows could flow into the infrastructure sector. This is indeed a very ambitious target. The sustained inflow of such volumes of external capital would require an open foreign investment regime. Simultaneously, attention should be paid to keeping the macro-economic fundamentals stable.


The importance of infrastructure sector also follows from the fact that foreign investors are now looking at infrastructural development as a yardstick for directing their investments. In fact infrastructural development had taken precedence over wage levels in assessing the investment potential in developing countries. In India infrastructure sector itself is becoming an attractive investment area for FDIs.

Already there is a huge demand for funds from the manufacturing sector. On top of that is the demand from the infrastructure sector. Both draw heavily from the savings of the household sector. The growth of financial savings of household sector however is not rising fast. In this context, the importance of increased obligation of domestic saving needs underscoring.


To encourage feign funds flow into the infrastructure sector, the Financing Ministry has allowed Foreign Institutional Investors (FIIs) also to invest in unlisted companies.

This was aimed at helping infrastructure companies as they would not be in a position to list their shares in the initial phase. FIIs now deploy 100 per cent of their funds in corporate debt. However, the Ministry has not dispensed with the 20 percent withholding tax on such investment as per the suggestions of the IIR report.

Speaking at the World Infrastructure Forum, John Taylor, Director, Infrastructure, Energy and Financial Sector Department, ADB, emphasised that the "counter guarantee" scheme was designed to cover specific risks including "discriminatory government action of various kinds, non-delivery of inputs or non-payment for output by State-owned entitles, availability of essential public services, changes in the agreed regulatory framework or tax regime, provision of essential complementary infrastructure, compensation or delays caused by government action or political uncertainty, transfer risks, foreign currency availability and convertibility."

In a bid to make the core sector attractive for FDI, the Cabinet Committee on Foreign Investment (CCFI) has modified the 49 percent cap on foreign equity in the infrastructure sector to render fund mobilisation easier. This major policy decision which will indirectly raise the foreign equity investment in infrastructure sector to well over 51 per cent it a domestic partner fails to meet his commitment from internal sources, including borrowing, should help the large industrial houses. The new mechanism is designed to over come the constraints for foreign equity cap in the infrastructure sector. Under the norms, companies operating in the sector can bring in equity through the mechanism of an investing company for the purpose of making investment in a licensee company n the service sector where there is a prescribed foreign equity cap.


Following were the specific proposals relating to infrastructure; 1) Telecommunications, oil exploration and industrial parks have been accorded the status of infrastructure; 2) the policy regarding oil exploration which was realised sometimes back was highlight; 3) The Finance Minister reiterated his commitment to many recommendations of the India infrastructure Report; and4) budgetary support to the National Highways Authority of India was enhanced from Rs. 2bn. to Rs.5bn. The Finance Minister opened up the health insurance sector to Indian private firms. Although, a small niche area, this is a significant move as it indicates the likely future deregulation of the sector.

The Central Plan outlay for 1996-97 including mainly on infrastructure has not shown any improvement, Inspite of a near crisis situation in infrastructure. This may be result of hypothesis made by the Government all along; i.e. private sector will take over whenever Government vacates, thus solving the problem. The feasibility and pragmatism of this hypothesis remain to be watched.

Compared to the allocation on Central Plan outlay and their growth in 1995-96, the performance in 1996-97 was not significant. The growth rate in the energy sector which declined both in real and nominal terms in 1996-97. The 1997-98 budget support for this sector has virtually been negated by the impact of inflation when the real increase has become negative. The same scenario emerges in the budgetary support to communication in 1997-98 with respect to science, technology and environment, although the growth is definitely better than what was provided in the last five years, it still remains very low.

Besides, even if allocation in the sector is raised with a greater inflow of FDI and a large participation of private sector, the immediate problem will still remain, since, infrastructure is prone to long gestation. Consequently, the inadequacy of infrastructure will continue for quite some time, unless technology upgradation can be done in the infrastructure production, including construction activities, for reducing the gestation lags and simultaneously improving the quality of products. With this infrastructure constraint any indiscriminate growth may lead the economy to a situation of over-heating and a further rise in inflation.

This poses challenges before the sector in several areas :

i) Capital accounts convertibility could also lead to large funds kept by Indians abroad flowing into India. The various estimates have put the NRI funds abroad at & 150-200 billion

ii) India is not alone in seeking foreign funds in the core sector. China requires US $ 5000 billion in the next two decades. So does Korea. India has to complete with them.

iii) One of the key problems in the commercialization of infrastructure is allocation or risks. The successful design of a project involves correct demarcation and allocation or risks. So far, projects were opened upto the private sector without adequate feasibility studies. The result projects once considered viable turn unviable when the bidders find their costs shooting up. This needs correction.

iv) The other problem is that infrastructure demand for funds is mostly long term and can come from the insurance and pension funds. But, these two areas have not been opened up. Here early action is needs.

v) Official and private perceptions over the viability of a project vary often widely. Differences have to be narrowed.

vi) In an infrastructure constrained economy with a high interest rate any large programme of investment may add to inflationary potential unless gestation lags in the projects are reduce. Here comes the choice of an appropriate technology to reduce investment lags which in infrastructure projects in India are very high compared to that in many successful reforming countries.

vii) The report (IIR) says that on the basis of existing tariff levels, it will be possible for port authorities to service debt obligations and pay a reasonable return on equity. But there is a need to delegate adequate power to port trust to facilitate speedy creation and operation of assets.

viii) The Ports will have to upgrade the facilities to international levels. In the modernised ports, cargo would be mechanically handled; there would be special facilities for handling container and bulk cargo and computer-based cargo clearance including customs clearance.  

ix) Similarly, the future of road development lies in finding out innovative ways of leveraging funds from the market to augment budgetary resources as also in adopting modern equipment-based technology leading to expeditious, construction of the much wanted roads.


Growth rate of six-core infrastructure industries picked up by 5.2% in November 20003 pushing up the overall growth rate in April-November 2003-2004 to 4.2%.  the segments that did well in November 2003 included petroleum refinery (20%) and coal (6%) sectors.  Power generation also picked up by 4.3% during the latest month.  Manufacturing sector did even better with growth rates surging to 8.1% in November 2003, the highest recorded over the past 45 months.

Similarly, there was some improvement in growth rates in mining and electricity segments.  But the trends have been fluctuating in the recent period in both these sectors. Growth of industry and the manufacturing sector in April-November 2003-04 is the highest recorded over the past six years and it almost rivals the peak levels of growth achieved in the mid nineties.

Economy and Infrastructure of India

Economy and Infrastructure of IndiaIndia is the seventh largest and second most populous country in the world. A new spirit of economic freedom is now stirring in the country, bringing sweeping changes in its wake. A series of ambitious economic reforms aimed at deregulating the country and stimulating foreign investment has moved India firmly into the front ranks of the rapidly growing Asia Pacific region and unleashed the latent strengths of a complex and rapidly changing nation. India's process of economic reform is firmly rooted in a political consensus that spans her diverse political parties. India's democracy is a known and stable factor, which has taken deep roots over nearly half a century. Importantly, India has no fundamental conflict between its political and economic systems. Its political institutions have fostered an open society with strong collective and individual rights and an environment supportive of free economic enterprise. 

India's time tested institutions offer foreign investors a transparent environment that guarantees the security of their long-term investments. These include a free and vibrant press, a judiciary that can and does overrule the government, a sophisticated legal and accounting system and a user-friendly intellectual infrastructure. India's dynamic and highly competitive private sector has long been the backbone of its economic activity. It accounts for over 75% of its Gross Domestic Product and offers considerable scope for joint ventures and collaborations.

Today, India is one of the most exciting emerging markets in the world. Skilled managerial and technical manpower that match the best available in the world and a middle class whose size exceeds the population of the USA or the European Union, provide India with a distinct cutting edge in global competition.

The road transport sector has been declared a priority and will have access to loans at favorable conditions. The Monopoly and Restrictive Trade Practices Act (MRTP Act) was passed in order to encourage large industry to enter the road sector.

The National Highways Act has been modified to help the reduction of tolls on national motorways, bridges and tunnels. Calcutta's Howrah Bridge is the world's busiest with a daily flow of 57,000 vehicles and innumerable pedestrians. Private participation in the energy sector has been encouraged with the reduction of import duties, a five-year tax exemption for new energy projects and a 16% return on equity. 

The government is also following a new telecommunications policy that aims for the improvement of quality to a worldwide standard and, as a result, India could emerge as a major producer and exporter of telecommunication systems. Advantageous policies in this sector are encouraging private and foreign participation. Given below is a profile of the present Indian Union Infrastructure:

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    Development-induced displacement

    From Wikipedia, the free encyclopedia

    Development-induced displacement is the forcing of communities and individuals out of their homes, often also their homelands, for the purposes of economic development. It is a subset of forced migration. It has been historically associated with the construction of dams forhydroelectric power and irrigation purposes but also appears due to many other activities, such as mining and the creation of military installations, airports, industrial plants, weapon testing grounds, railways, road developments, urbanization, conservation projects, forestry, etc. Development-induced displacement is a social problem affecting multiple levels of human organization, from tribal and village communities to well-developed urban areas.

    Development-induced displacement or the forced migration in the name of development is affecting more and more people as countries move from developing to developed nations. The people that face such migration are often helpless, suppressed by the power and laws of nations.

    The lack of rehabilitation policies for migrants means that they are often compensated only monetarily - without proper mechanisms for addressing their grievances or political support to improve their livelihoods.

    Displaced people often internalize a sense of helplessness and powerlessness because of their encounter with the powerful external world, although there are also several examples of active resistance movements against development-induced displacement. In every category, particularly among marginalized groups, women are the worst hit and pay the highest price of development. A study carried out by thenational commission for women in India (NCW) on the impact of displacement on women reveals that violence against women is increased. An increase in alcoholism due to displacement has led to a marked rise in domestic violence in India.In the Lincoln Park Community of Chicago,Illinois,where Jose(Cha-Cha)Jimenez founded the human rights Latino organization:Young Lords,Mayor Richard J. Daley displaced tens of thousands Puerto Ricans and the poor.This displacement helped to proliferate growing street gangs.Today these gangs enterprises with murder for hire,arson for profit and drug sales as its prime motivation.Displacement has made men feel helpless or insecure and turned women and children into scapegoats. Displacement also leads to deterioration in health and high mortality rates as services in those selected areas are the first to be cut.The nutrition and health of women, which is worse than that of men even under normal circumstances, is bound to go down in the event of an overall worsening in health caused by displacement.

    Humanitarian aid agencies and government programs should target their efforts when intervening to assist victims of forced economic displacement,to ensure their work does not run counter to processes aimed at addressing the fundamental roots of the conflict. The Overseas Development Institute advocates the search for durable solutions to the recovery of displaced persons which go beyond short-term return, relocation and local integration processes.[1]

    [edit]Modern examples

    [edit]See also

    • Economic migrants (not to be confused with "development-induced displacement", as the cause of their migration is not necessarily "development", but is to the contrary likely caused by the absence of development)



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    Voluntary Action and Alternative Development in Tribal Areas


    After attaining independence most Third World countries embarked on the path of modernisation to catch up with Western countries in the shortest possible time. The national elites in these countries bent their energy to accomplish this task. The experience gained during the first two development decades amply showed that the two concepts of modernisation and development were most inadequate to solve the problems facing the people in these countries. Although some economic growth was registered, the process brought in its train greater dependence on Western countries and widened the gulf between rich and poor in different countries. At some places this led to the emergence of powerful social movements. This invited a backlash from vested interests tending to promote parochial and obscurantist values which militated against the goals of modernity.

    The development experience among the tribal communities is not very different from that of general society in India. In certain cases, tribals have been hurt rather than helped on account of the development effort. In most cases it resulted in development for the few and destitution for many. The experience of the pains of development is very poignant. Some of these are quite visible while others can be discovered after a deep probe into the social fabric.

    In India the bulk of the tribal community is spread over middle India from Gujarat to West Bengal and in the north-east. The tribals in the north-eastern states form a majority there. The tribals in middle India live interspersed with the dominant population. It is there that their deprivation and exploitation are the worst. Tribal policies in India suffer from a hangover of the colonial past. The British system of administration tended to impair their social solidarity and weakened the authority of their social heads and pancayats. Until recently, when rules against alienation of ancestral land were promulgated by the government, the ancient tribal customs against such alienation were disregarded. After Independence efforts were made to integrate the tribals into the mainstream of the Indian polity through elimination of exploitation and positive measures for raising their levels of living. But even forty years after Independence they are being deprived of command over the resources which they enjoyed in their respective areas. The opening up of inaccessible tribal areas has aided this process. The tribal people along the arteries of communication are being squeezed out of their land. The new enclaves of affluence in tribal areas have no place for tribals. They are losers on all counts and are victims of a system in which those responsible for policy-making suffer no embarrassment and qualms of conscience.

    The problems of tribals coming under the sway of large industrial, mining and irrigation projects are most acute. It is a pity that the difficulties of the tribals were not perceived earlier. The issues are not just alternative use of resources or cost-benefit analysis of projects. They are deeper and involve human rights, civilisation's values and national obligations. The tribal people are faced with rapid change, which tends to create a crisis in their life. Displacement spells disorganisation and destitution. They lack skills for an alternative way of life. It is at this stage that the concept of sustainable development or alternative development has to be thought of. Unfortunately not much thinking in this regard has come from the government. It is on account of this that the role of voluntary agencies in this field becomes important.


    The experiment in alternative development which is the theme of this paper has been carried out in the Santhal Parganas by the Badlao Foundation during the past ten years. The Santhal Parganas is the north-eastern extension of the Deccan plateau. The region is bounded on the west and south by a number of districts of Bihar and to the east by some districts of West Bengal. Ethnologically, it is the abode of two important tribes, the Santal and the Paharia. The activities of the Badlao Foundation are spread mainly among these tribes in the districts of Deoghar, Godda and Dumka.

    The Santal are the largest tribe of eastern India. In Bihar alone they number more than two millions. The traditions of the Santal represent them as a group wandering from one land to another until they found their present home in Chhota Nagpur and the adjacent districts. On the basis of their traditions, several theories have been put forward to account for their origin. About the middle of the 18th century Chhota Nagpur was the chief habitat of the Santal. At the end of the century, as the jungles were being cleared and the pressure of population was keenly felt, they moved up towards the virgin forests in and around the Rajmahal hills. The Permanent Settlement of 1793 forced the landlords to pay more attention to land improvement and reclamation, for which the Santal were increasingly used. In 1832 the government set apart a large area in the Santhal Parganas for the settlement of the Santal. This region was known as Damin-i-Koh. The population in this tract increased from 3,000 in 1838 to 82,795 in 1851. Thus from the middle of the last century Damin-i-Koh became the main concentration of the Santal.

    In reclaiming land and clearing jungle the Santal have few equals in India. They live in villages consisting of a long street with a single row of dwellings on either side. Santal houses are built of mud but roofed with country-made tiles. The houses are kept very neat and clean and the outside walls are painted with exquisite designs. The Santal are settled agriculturalists and use simple agricultural implements. However, they derive a part of their sustenance from the forest, since their agricultural field are monocropped. The Santal produce rice, maize, millets, beans, and vegetables. About 82 varieties of wild plants, 70 varieties of fruits, 7 varieties of resins, 31 varieties of mushrooms and several varieties of jungle millets are gathered at one time or other. Wild foods are collected by women who work together in groups. Santal men go on hunting expeditions.

    The Santal live in nuclear families and are patrilineal in descent. Several kinds of marriage are prevalent, but the most prestigious one is that in which bride-price has been paid. A daughter does not have a share in her father's property but she can hold moveable property like money, goods and cattle. Women's status in society is high and in most cases they run the households. However, they do not have political or religious rights. They are not members of the village pancayat, although Santal society is highly democratic. Women work with men in fields, farms and forests. They go to the market and strike bargains for the surplus produce of the family. Santal society is marked by a spirit of cooperation and it is manifested not only on the occasion of festivals but also in all kinds of social and economic activities. Friends share wedding expenses with each other, help each other in cultivation, lend each other plough cattle and rally to each other's help at birth, sickness, or death and assist each other with loans that are free of interest. Santal religion is a potent force in strengthening the social solidarity of the people. The Santal concept of righteousness is bound up with its social or tribal consciousness. They have an excellent and well-ordered village organisation with a hierarchy of village officers and courts for dispensing their unwritten law. The unique form of punishment called bitlaha is used to bring to book persons guilty of transgressing the social code regarding sexual relations inside the clan and outside the tribe.

    The Sauria Paharia, the largest Paharia group, accounted for 65,000 persons in 1988. The Sauria Paharia are basically shifting cultivators and live on mountain spurs in very small villages. They have a feeling of animosity toward the Santal who live largely on the plateau and use more sophisticated tools for agriculture. They speak a language which belongs to the intermediate Dravidian group so widely different from the Austric speech of the Santal.

    Sauria Paharia settlements comprise ten to fifty houses. The houses are very small and rickety compared to Santal houses. Their main occupation is slash-and-burn cultivation, known locally as kurwa. They move from field to field after a few years. They use only the digging stick for putting in the seeds. They grow maize, millets, beans and pulses. Some of these tribesmen have picked up settled cultivation if they have some plain land. The Paharia as compared to Santal are more dependent on the forest. Earlier they used to make some money by cultivating sabai grass. But now they do not do so in a big way as its market has shrunk. The cutting down of forests and the restrictions placed on their exploitation led to a reduction of their resource base. Although the Sauria Paharia have cherished a healthy relationship between nature, man and the spirits for a long time, they are extremely frustrated as their gods have failed to protect them from the ravages of time. Abject poverty and disease have made them panic. The steps taken by government for their welfare have largely bypassed them, and they remain one of the most backward tribal groups in the state.


    It is in this background that the Badlao Foundation is concentrating its effort. In recent years, voluntary initiatives have raised debates on new issues and concerns which have emerged from our development programme over the past four decades. The issues of deforestation, air and water pollution, ecology, rights of women and rural labour, rights of construction workers, occupational health and safety, land degradation and alienation, housing rights, right to information and work, adult literacy and education of women, etc., have been articulated by individuals and organisations involved in voluntary action. Although even earlier the role of voluntary agencies in bringing about development was recognised, it was only in the Seventh Plan document that the role of voluntary organisations was clearly set out. Voluntary agencies were not only to supplement government efforts but also to offer the rural poor choices and alternatives. Thus the voluntary agencies could experiment and innovate new schemes and programmes to bring development to the rural poor. Since they had close links with the grassroots, they were expected to elicit people's participation in a much larger measure than otherwise. The development package could differ from area to area and even from village to village. The voluntary agencies were not expected to supplant government efforts and replace dependence on the government by dependence on themselves, but in helping people help themselves. People have to be made aware of their own problems. They have to work out the priorities themselves in view of the limitation of resources.

    The Badlao Foundation was established by certain activists who were inspired by the J.P. movement which took place in the mid-1970s. In the early 1980s there was no voluntary organisation in the pockets in which work was started. The area chosen was about eight kilometres from Mihijam on the Bihar-Bengal border. Long economic deprivation and the excesses perpetrated on them by the moneylenders had put the tribal population in a state of despondency. In such a situation an all-round effort had to be made to generate income for them through fresh schemes, i.e. sericulture, livestock, milch cattle, cottage industry, small trades, social forestry, spinning, weaving, etc. In addition to this, there was urgent need for educational and health programmes for the people. The Foundation set before itself the following tasks:

    1. To develop skills and self-reliance in social, economic, cultural and political fields through raising social consciousness and sense of civic responsibility among the tribal and poor population for bringing about their socio-economic transformation

    2. To initiate small economic programmes for women through the creation of Mahila Sabhas

    3. To mobilise different segments of the society, particularly the youth

    4. To organise discussions, meetings, environmental festivals, exhibitions, cultural programmes, and to conduct tours for tribal people to acquaint them with successful development efforts

    5. To conduct training in ecology and environment

    The fast depletion of forest cover in the region affected the life of tribals very adversely. They depended for their livelihood, in large measure, on the forest. They took advantage of various kinds of timber and non-timber produce. In the lean months of the year, they could subsist on products like mahua and jackfruit. The cutting of forests was accelerated by the local contractors in collusion with the lower functionaries of the Forest Department. They cut more forest than they were permitted to. The Forest Department held that the illegal cutting was the work of tribals, and a large number of Santal and Paharia were sent to jail on this ground. The depletion of forest resources led to the disappearance of a large number of medicinal plants which were used for curing human and animal diseases. It also led to the disappearance of a large number of animal species. Valuable pasture land was also lost and it has become a problem for the grazing of domestic animals. In some areas where certain communities were dependent on pastoral activities, their source of income disappeared. The cottage industries in the village, which provided sustenance for certain communities, decayed in course of time due to lack of availability of raw materials which were derived from the forest. Prominent among them was the production of cotton, taser silk, the lac industry and the growing of sabai grass, which was used for the production of paper.

    To add to this environmental degradation, the proliferation of stone quarries and stone crushers brought untold misery to the people. After the quarries were exhausted the entire landscape was marked by pits and nothing could be produced there. On account of strong winds stone dust coming from the stone crushing machines spread along the nearby fields and reduced their fertility. Not only this, the health of the people working in the quarries and living in nearby areas was also affected. They began to suffer from lung diseases such as silicosis and asthma. They also complained about skin diseases and deafness. Protests made by local people against the opening of stone crushers went unheeded on account of the influence of capitalist interests.

    Another impact of the depletion of forests was the drying up of rivers and other sources of water. Many rivers which were earlier perennial changed their character and water was available in them only in the rainy season. The amount of precipitation was also reduced, resulting in scarcity of water. As a result, people have to drink stale and contaminated water. This has led to the appearance of many diseases.

    The landscape changed a great deal on account of large-scale soil erosion. In many areas land was rendered uncultivable due to sand and the formation of gullies. All this led to reduction in the cultivable area. The process of desertification has set in and more and more land is turning barren.

    Faced with this ecological problem the Badlao Foundation took steps to restore the ecological balance by arresting further degradation and conserving and regeneration of the existing natural resources. The steps taken were threefold: adoption of sericulture as a supplement to agriculture in a big way, ecological cultivation and afforestation. All this needed building of awareness about environmental degradation among the people by pointing out how it was affecting their life adversely and how it was going to affect future generations. Since the women suffered most on account of environmental degradation by way of loss of food resources, employment opportunities, and migration of the menfolk in search of employment away from home, an effort was made to carry on the awareness programmes most vigorously among them through village Mahila Sabhas.

    It was seen that the area was ideally suited for the plantation of arjunasan and mulberry trees on which silkworms could be reared. The Foundation started a training programme to impart knowledge to a group of women about the complete process of sericulture, from silkworm rearing to silk production. The men were left undisturbed to carry on their own activities. The training was divided into phases. Once the training in worm rearing was completed, the women were trained in reeling and spinning. Later on they were also trained in weaving on looms. Nowhere in these parts do we find women engaged in weaving, but here women have eagerly taken up this activity. Engagement in such activity gives them supplementary income. This was augmented by other income generation schemes like goat rearing, raising of fruit and vegetable seedlings, horticulture, etc. A number of case studies of women showed that family income went up with these activities. The example set by some of the beneficiaries were ample demonstration to their neighbours to follow suit.

    The second activity of the Foundation to restore the ecological balance was ecological cultivation. On account of the decline in the productivity of land, government effort was directed towards the use of more and more chemical fertilisers. However, it was found that the excessive use of chemical fertilisers was extremely harmful to the land in the long run. It has been observed that a balanced integration between plants, animals and insects is essential for sustainable development. The tribals had a strong tradition of using green manure for better produce. The Paharia engaged in shifting cultivation, which was an appropriate technology designed to regenerate forest and restore soil fertility. The burning of the undergrowth provided ample fertiliser for the shifting cultivation plot. After a few years, the plot was left fallow, the forest regenerated and thus the shifting cultivation cycle was maintained. In the shifting cultivation field there has been a tradition of mixed cropping. If one crop fails, the other crop helps the people to tide over the crisis and there is never a total famine in such areas. However, with the conversion of many of these plots into settled cultivation fields, the regeneration process has stopped. Studies made by scientists have made it clear that this pattern of ecological degradation is marked in this area after it changed from a collectional economy to settled agriculture. Almost all the farmers of the region are small and marginal farmers with uneconomic holdings. They are now looking for opportunities other than agriculture to make a living. Large numbers of them have become daily wage earners and migrate to neighbouring areas in search of seasonal employment. The Badlao Foundation targeted this group for experimenting in ecological cultivation.

    To start with, the Foundation introduced ecological cultivation in ten villages of Madhupur Block of Deoghar district in 1989 with the following objectives:

    1. To raise awareness and knowledge about ecological cultivation among individuals and peasant groups

    2. To train and mobilise peasants in the operational area for reducing the use of chemical fertilisers in order to retain and enhance the productive capacity of the land

    3. To train the farmers about the need to preserve and increase environmental capital for future generations

    4. To discuss with the beneficiaries some of the aspects of the traditional cultivation system in relation to ecological constraints

    5. To increase among beneficiaries knowledge of the environment

    6. To safeguard the environment for the present and achieve full harmony with nature.

    Thus the spectrum of ecological cultivation has four components: (a) awareness, (b) analysis of the situation, (c) conservation and (d) sustainable development. Awareness includes making individual farmers conscious of the physical, social and economic aspects of the environment.

    The experiment in ecological cultivation started with four farmers, two using the present system and two the innovative method. Before launching the programme, comprehensive soil testing and crop-wise doses of green manuring required in the fields were done by the Foundation. When the final accounting was done, it was evident that ecological cultivation is a viable proposition. In the present system 35 per cent of the operational cost is incurred on chemical fertilisers and pesticides. In the experimental area green manuring and compost accounted for only 23.5 per cent of the cost. In addition to economy, ecological cultivation ensured the retention of soil fertility over a longer period of time. Later on the area of ecological cultivation was extended. Training was provided for this purpose to farmers in a number of villages. The popularity of green manure has gradually increased. Many farmers are now retaining dhaicha seed for use year after year. The main reason for the adoption of ecological cultivation is reduction in the cost of inputs. This is accompanied by water harvesting, which has reduced the cost of irrigation.

    The environmental programme of the Foundation was also devoted to the regeneration of forests. In some areas where large chunks of land were available, the Foundation began afforestation work by planting trees yielding fruit, fodder and fuel. In some villages in the Jarmundi Block such plantations was done over 177 acres. Both grafted and local trees of different species were planted. Mango, guava, lemon, amla and coconut trees were most popular. The plantations were done in four villages. A total of 3,900 fruit trees wee planted, fodder and fuel species numbering more than 16,000. Irrigation was provided for the new plants. Grafts, seedlings, manure and agricultural implements were given to the farmers in these villages. In about three years the barren fields have turned green. Some of the quick-growing fuel and fodder trees are being used by the village people. The fruit trees will begin to give yields in a couple of years. The village people have realised the importance of these plantations. They take care of the plants and protect them from being destroyed by animals. They also look after the nurseries with loving care.

    In all its activities the Foundation has involved the beneficiaries in the different programmes so that they do not regard the innovations as impositions from above. Participation of the people is coming in large measure because the Foundation is interested in their integrated or total development. The educational and health programmes have endeared this voluntary organisation to the people. Increasing awareness has made them conscious of their own ability to contribute to their well-being. They now take full advantage of governmental schemes and the credit facilities being extended by banks. Their concern for conservation of the environment is evident in their efforts to minimise the felling of existing forests and saving them from the depredations of unscrupulous elements. The apathy to their environment and development is no more evident in the operational area of the Foundation. With alternative avenues of income from agriculture, sericulture and other activities, both men and women are keen to improve their quality of life. Their aspirations have gone up. Thus the Badlao Foundation has shown ways in which the tribals in the area and other people can help themselves. It has also set an example for other voluntary organisations to work for sustainable development in tribal areas.

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    Bhure Lal*

        The Scheduled Tribes (STs) according to the 1991 Census account for 67.76 millions representing 8.08 per cent of the country's population. They are spread across the country mainly in the forest and hilly regions. More than 70 per cent of the ST population is concentrated in Madhya Pradesh, Maharashtra, Orissa, Bihar, Andhra Pradesh, West Bengal and Gujarat. The essential characteristics of these communities are primitive traits, geographical isolation, distinctive culture, shyness of contact with communiies at large and backwardness.

        The founding fathers of the Indian constitution were aware of their problems. Therefore, they made special provisions for their protection and development. The main safeguards include promotion of educational and economic interests and their protection from social injustices and all forms of exploitation. The constitution protects the general rights of all Indian citizens to move freely, settle anywhere and acquire property. It also permits the States to make reservation in public services in case of inadequate representation and requiring them to consider their claims in appointments to public services. The constitution provides special representation for the STs in the Lok Sabha and State legislative assemblies till 25th January, 2010 (Arts, 330, 332 and 334) and enjoins the setting up of separate departments in the States and National Commission at the Centre to promote their welfare and safeguard their interests (Arts 164 and 338). Special provision for administration and control of Schedule Areas and Tribal Areas (Art. 224, Fifth and Sixth Schedules) and grant -in-aid to the States to meet the cost of such schemes of development as may be undertaken by them for promoting the welfare of the Schedule Tribes or raising the level of Schedule Areas (Art. 275 (1) are also guaranteed. Later on with a view to effectively deal with the crimes against the Scheduled Tribes two special laws, viz., Protection of Civil Rights Act, 1955 and the Scheduled Castes, Scheduled Tribes (Prevention of Atrocities) Act 1989 were enacted.

        Special economic development of the Scheduled Tribes and protection against their exploitation has been an important agenda of the Government. To ensure that the constitutional mandates listed above and translated into various policies and programmes and put into effective action, high priority for the welfare and development of Scheduled Tribes right from the beginning of the First Five Year Plan (1952-57 is being accorded. Recognising their special problems the principles of Panchsheel have been adopted in the welfare and development of these communities so as to ensure an understanding of their culture and traditions and an appreciation of the social, psychological and economic problems with which they are faced. An important landmark was opening of 43 Special Multi-purpose Tribal Blocks (SMPTBs) during the Second Five Year Plan, later called Tribal Development Blocks (TDBs), each having about 25000 people as against 65000 in a normal block. An amount of Rs.15.0 lakh per SMPTB was contributed by the Central Government. Further, an important step in this direction was taken during the Fourth Five Year Plan when six pilot projects in Andhra Pradesh, Bihar, Madhya Pradesh and Orissa were set up in the Central sector. A separate Tribal Development Agency was established for each project and an amount of Rs.2.0 crore was allotted to these agencies. Commissions and Committees appointed by the Government to review the tribal situation brought to its notice that the percolation theory had not helped the tribals in getting their due share and the backward classes sector had substituted general sectors instead of supplementing them and viewed that much more was still needed to be done to bring up the STs on par with the general population of the country.

    Tribal Sub-Plan

        The Fifth Five Year Plan marked a shift in the approach when the Tribal Sub Plan (TSP) for direct benefit of the STs was launched. The Tribal Sub-Plan for the Scheduled Tribes was designed to channelise the flow of outlays and benefits from the general sectors in the plans of the States and Union Territories (UTs) and Central Ministries in proportion to their population both in physical and financial terms. It is an umbrella under which all schemes implemented by the States and Central Governments are dovetailed for addressing different needs of the Scheduled Tribes.

        It is basically an area development programme with focus on tribals under which infrastructural development and family-oriented programmes are undertaken. The strategy has been successful in garnering larger flow of funds for the development of Scheduled Tribes from Rs. 759 crore during the Fifth Five Year Plan to about Rs. 16902.66 crore by the end of the Eighth Five Year Plan (1992-97).

        The Ministry of Tribal Affairs, besides providing Special Central Assistance, which is an additive to the Tribal Sub Plan of the States and UTs and grants under Article 275 (1) of the Constitution for raising the level of infrastructure in the Scheduled Areas and economic development of the Scheduled Tribes to the level of general population, is also implementing various Centrally-sponsored and Central sector schemes under which financial assistance ranging from 50 per cent to 100 per cent is given to the States and UTs for construction of hostels and coaching of ST students for competitive examinations, upgradation of their merit, research and training, setting up of ashram schools, vocational training centres, village grain banks, educational complexes for ST girls in low literacy pockets and development of primitive tribal groups. Besides, non-governmental organisations (NGOs) have also been involved in the development of STs. Their developmental and financial needs are being taken care of over and above the credit available through priority sector lending of banks and other institutions by the NSFDC.

        With the prime objective of providing marketing assistance and remunerative prices to tribals for their minor forest produce (MFP) and surplus agricultural produce (SAP) and to wean them away from exploitative private traders and middlemen, the Tribal Cooperative Marketing Development Federation (TRIFED) was set up by the Government in the year 1987. The TRIFED has ensured remunerative prices for the MFP to tribals.

        While these achievements are a matter of some satisfaction as various development plans, policies and programmes have brought forth a perceptible improvement in the socio-economic status of the Scheduled Tribes a lot more needs to be done with concerted focus on the issues crucial to improve their status on par with the rest of the population. These are: prevention of land alienation from tribal to no-tribal, review of National Forest Policy and Forest (Conservation) Act 1980, taking into consideration symbiotic relationship the tribals are having with forest, provision of clean drinking water and medical facilities, effective rehabilitatiion of the tribals displaced on account of setting up of development projects and legal measures to crub the activities of money lenders and traders by effective implementation of laws and regulations. Women play a significant role in tribal society: their empowerment with upgradation of their skills is one of the issues to be addressed urgently. To look into these issues and further focus attention on the development of tribals the Government has set up separate Ministry under the charge of a Cabinet Minister. The Government is working hard towards a new social order based on social equality and social harmony.

    *Secretary, Ministry of Tribal Affairs

     Centre for East-West Cultural and Economic Studies, Bond University (Australia), Research Paper No. 11, February 2005, Copyright © Nilakantha Panigrahi 2004-2005 `





    by Nilakantha Panigrahi *



    Eco-tourism both at conceptual and empirical levels is significant in a number of respects. Traditionally it encapsulates scientific, aesthetic, and philosophical approaches which reflect the structure and function of the society. Over the decades numerous changes have been observed both in the content and context of eco-tourism. With globalisation the processes of these changes not only widened and multiplied, but also gained in importance. The present research paper in observing the treasure of tourism of the Orissa region in eastern India, emphasises the potential of eco-tourism in the scheduled areas which are largely dominated by the tribal communities. It argues - and concludes by way of recommendations - that if eco-tourism is properly developed it can not only attract tourists from far and near, but can also generate more revenue for the inhabitants of the region and for the state.

    Key words: Eco-Tourism, Tribal Communities, Ethno-Cultural groups, Scheduled Areas, Tribal Museum.

    *Dr Nilakantha Panigrahi is from the Faculty in Anthropology, NKC Center for Development Studies (ICSSR supported Center), Bhubaneswar, Orissa, India, Email: and



    India is one of the few countries of the world endowed with an array of tourism resources - from bio-cultural diversity to a wealth of histories and antiquities. These should have accelerated the growth of tourism in India at four times the world average (WTO 1994). In reality, smaller countries like Malaysia, Indonesia, Hong Kong, the Maldives and Bhutan have proved more adept at promoting their national tourism as a successful industry (Singh1996). Tourism is one of the largest sources of foreign exchange in countries such as Costa Rica, Belize and Guatemala (Yadav 2002). In the Indian context, decades of dangerous development policies have threatened the integrity of the ecosystem - so much so that today, politicians, scientists, activists and local communities are struggling to balance the need for economic growth with the preservation of natural resources. The whole coastal region on the western and eastern seaboards of India, starting from Central Goa, Kovalam, Puri, to Mahabalipurum remains unattractive. The ancient cities, which once glorified the rajas and maharajas and also signify to this day religious sanctity, are no longer the magnets they once were.


    The paper is divided into five parts. First, the concept of eco-tourism is explained and the major focus of the government is reviewed. Second, it briefly describes the treasure of tourism and the tourist potential in the State of Orissa. Third, it highlights the socio-cultural profile of the tribal communities in general and Primitive Tribal Communities in particular living therein, and the potential for tourism expansion from within the State. Fourth, the paper from empirical sources explains the potential for ethnic tourism, both from within and outside India. Finally, through the evidence, it analyses the potentialities and prospects of ethnic tourism in Orissa. For preparation of this paper data has been collected from secondary sources of Government and non-Government records and reports. The experiences documented by the author as a social anthropologist have helped to identify the rich potentialities of eco-tourism, particularly in tribal regions of the State. In order to establish the importance of eco-tourism the study has adopted an ethnographic approach that reflects the socio-cultural importance of tribal communities and their region.


    I: The Concept of Eco-Tourism

    The concept of eco-tourism has been defined differently by the various national and international agencies. Conceptually, eco-tourism encapsulates a type of

    "tourism that involves travelling to relatively undisturbed or uncontaminated natural areas with the specific objective of studying, admiring and enjoying the scenery, wild plants and animals, as well as the existing cultural aspects (both past and present), found in those areas. Ecological tourism implies a scientific, aesthetic philosophical approach, although the ecological tourists are not required to be a professional scientist, artist or philosopher. The main point is that the person who practices eco-tourism has the opportunity of emmersing him or herself in nature in a way most people can not enjoy in their routine . . ." (Ziffer 1989, Boo 1990, Lindberg 1991, and WTO/UNEP 1992).

    Other scholars have also used the term 'nature tourism' (Ceballos-Lascurain 1987) which is not necessarily ecologically sound; while Cohen (1984) raised the issue of neglect of development in and around protected areas. The definition of eco-tourism has changed considerably from a descriptive concept in which there is no difference between nature-tourism and eco-tourism to today's usage: that is, the 'desired state' of development in reaching a balance between 'nature conservation', 'sustainable socio-economic development', and 'nature tourism' (Boo 1992b; Ziffer1989). Most have emphasised the management of tourism and conservation of nature so as to maintain a balance between tourism and ecology on the one hand, and the requirements of local communities in terms of generating employment, enhancing their earning skill, and improving the status of women.

    The UN International Year of Eco-Tourism during 2002 reviewed eco-tourism experiences worldwide, highlighting three significant aspects: 1) nature, 2) tourism, and 3) local communities. Most of the studies relating to tourism emphasise the economic dimensions at international and national levels (Gray 1970; EIU 1973; Thuens 1976; Mathieson and Wall 1982), while very few have investigated local levels (Henderson 1975; Vaughan 1977; Singh 1981; Dube 1985; Chopra 1991; Srivastava 1992 and Singh 1992; further elaborated below). Likewise, there have been proposals to link cultural and eco-tourism into a more sustainable perspective which is able ' to acknowledge the natural environment, built environment, icons, and attractions of destinations as part of the cultural package' (Greathouse Amador 1997).

    Ceballos-Lascurain (1996:46-48) estimated the potential number of eco-tourists globally at between 157 to 236 million, capable of generating expenditures of up to US$1.2 trillion, while Honey (1999:9) calculated it at US$30 billion per year. In view of these estimations, it is understandable that the United Nations should have declared 2002 as the International Year of Eco-Tourism. Eco-tourism and eco-tourists are clearly significant to the tourism economy and the environment. In contrast to conventional tourists (Gossling 1999:309; Koch 1997:218) eco-tourists stays in facilities that are likely to be owned and managed by local people rather than multinational corporations, and often eat local food and consume local services (West and Carrier, 2004, 483-498). Honey (2003) thus defines eco-tourism as aimed to protect and benefit conservation; benefit, respect and help empower local communities; and educate as well as entertain tourists.

    Different studies have highlighted various aspects of eco-tourism. Some have focused on the industry aspects, such as the nature and quality of provision and environmental attraction that eco-tourists expect (e.g. Khan 2003, Rudd Tupper 2002), while few have studied the relationship between eco-tourism and the local people's conventional livelihoods and forms of social organisations (e.g. Akram, Lant, and Burnett 1996; Belsky 1999; Medina 2003) and others have analysed the motivation of the eco-tourists (e.g. Duffy 2002; Munt 1994). Only over the last decade have serious efforts been made to establish strategies that link eco-tourism and cultural tourism into sustainable 'pro-poor' tourism approaches (Poyya 2003).

    A review of the Indian case reveals that tourism has helped in maximising economic benefits rather than ensuring social benefits. Eco-tourism as a concept centres on the nature of the tourism and with regard to local communities, emphasises conservation, sustainability and biological diversities. In the Indian context all the Five Year Plans have built up infrastructure, including tourist circuits and centres, diversified tourism from the traditional sight-seeing tour, to non-traditional areas such as trekking, winter sports, beach resorts; restored and balanced development of national heritage of cultural, historical and tourist importance.

    International tourism in India increased during the decade of 1981 to 1990 and generated foreign exchange and employment (both direct and indirect) (Mary and Chung, 1996). However, the assassination of Prime Minister Indira Gandhi (1984), the crash of Airbus (1990), the assassination of Prime Minister Rajiv Gandhi (1991), the brutal killing of Graham Stains and his two children (1999), caste conflicts, the occurrence of Kargil war with Pakistan (1999), reoccurrence of terrorism, communal riots, etc. have affected the growth of tourism in India. However this is offset by networks of 572 nature-endowed areas, 89 national parks, and 483 wildlife sanctuaries and 3,606 protected monuments under the Ancient Monuments and Archaeological Sites and Remains regulations that mobilise tourists from within and outside of the nation. 


    II: Rediscovering the Tourism of Orissa

    The State of Orissa is situated on the eastern coast of India, on the Bay of Bengal. It is endowed with natural attractions such as beaches, lakes, and forests teeming wildlife, as well as a rich cultural heritage inclusive of monuments, ethno-handicrafts from the various ethnic groups, colourful fairs and festivals, music and ethnic dances.


    Tourism has been recognized as an industry in Orissa and sizeable revenue is earned for the State from domestic as well as foreign tourists. The Government during the Third Five-Year Plan (1961-1966) first mooted the idea of tourism, which was revamped during the Fifth Five-Year Plan (1974-1979). The creation of a State Department of Tourism dates back to 1973, though modifications have been made from time to time as regards functions of the Department. The Department of Tourism and Culture has been functioning in its present status since 1995. The Orissa Tourism Development Corporation was created in March 1979 and it was incorporated under the Companies Act in September 1979 (Government of Orissa, 2002).

    Traditionally known as the land of Lord Jagannath, Orissa is attractive to tourists of various interests. The innumerable temples of Orissa scattered throughout the length and breadth of the State, ranging from the miniature on the Mahendragiri to the gigantic Jagannath, Lingaraj and Sun Temple of the Golden Triangle, appeal to both pilgrims and cultural tourists. The capital city of Bhubaneswar at one time is said to have had as many as 7000 temples; scores of them stand to this day. Here one can find a chronological development of temple architecture over centuries beginning with the Bharateswar, Lakshmaneswar, and Shatrughneswar group of temples to the great Lingaraj. There are 79 heritage sites in Orissa protected by Archaeological Survey of India. Bhubaneswar alone accounts for 22 out of these heritage sites. But in most of these places such sites have been encroached upon by a range of human activities.


    Konark , one of the many fine temples in Orissa

    (Photo copyright R. James Ferguson 2002)

    Similarly, in the Western parts of Orissa, Sambalpur and Sonepur can be regarded as 'mini' temple towns. They have developed a separate style of temple architecture, which flourished during the Chouhan rule in Western Orissa. A special mention in this connection can be made of the leaning temple of Bimaleswar at Huma, 30 kilometres from Sambalpur on the bank of the river Mahanadi. Out of four distinguished Yogini shrines of India, Orissa has the distinction of having two. One of them is at Hirapur near Bhubaneswar and the other at Ranipur Jharial in the district of Bolangir. At Ranipur and Jharial the temple stands in close proximity of numerous Saiva shrines and a Vaishnaba shrine. This speaks of the cultural synthesis that emerged in this region (Government of Orissa, 2002).

    The brick temple of Ranipur, Jharial and the Pataleswar brick temple of Buddhikomna are among the finest of the very few brick temples of India. The rock-cut caves of Khandagiri and Udayagiri help to explain the hitherto obscure history of Orissa. The double storied Ranigumpha in Udayagiri reflects the socio-economic and political life of that period. The Kalinga war famed Dhauligiri contains the rock edicts of Emperor Ashok. Another rock edict of the same emperor is found at Jaugada in the district of Ganjam. Dhauligiri can be of more interest for Buddhist tourists with the peace pagoda constructed on the top of the hill in the early 1970s. Another treasure house for the Buddhists is the Ratnagiri-Lalitgiri-Udayagiri complex where once stood the famous Pushpagiri Buddha Vihar. The recent discovery of the mortal relics of Buddha at Lalitgiri, and new excavations at the nearby Langudigiri with their significant finds, have enhanced the importance of the region. However, the construction of Government offices at Udaygiri within 100 meters of the prohibited zone draws attention to the encroachment of heritage sites even by the State (Government of Orissa, 2002).

    The Chinese traveller Hieun Tsang described the Nrusimhanath Plateau in the district of Bargarh as Po-lo-mo-lo-ki-li, which may be the Parimalagiri Buddha Vihar. Excavations in a place called Kuruma near Konark have also brought to light the remains of a Buddha Vihar. The pictographic sites of Vikram-khol in Sambalpur district, Yogi Math and Gudahandi in Kalahandi district provide considerable opportunity for study of the prehistoric age, as evidenced by repeated visits from a number of historians and archeologists.

    Places of natural beauty are in abundance in Western Orissa, particularly the streams and forests at Harisankar in Bolangir and Nrusinghanath in Balangir. The deity of Nrusinghanath sitting in the shape of a half-human and half-lion form tearing Hiranyakasipu against the backdrop of a stream is a scene to witness. Kalahandi district is endowed with the wealth of forests (in which roams a rare species of black tiger), a natural waterfall at Rabandar, and a host of temples situated at the hilltops of Bhawanipatna. These are places of touristic importance. Other attractions include as the Patala Ganga spot at Nawapara district, Ushakothi, Hirakud and Badrama in Sambalpur district, the Khandadhar waterfall in Sundargarh district, as well as the Mahanadi and the Tel river in Suvarnapur district.

    There are more than 20 sanctuaries in the State. The lush green forests of Ushakothi and Similipal filled with the chirping of birds and a rich wild life are ideal for the development of eco-tourism in Orissa. Moreover, the biosphere reserve of Nandankanan, the natural Chandka forests, the Nandankanan Zoological Park are located only 20 kilometres from the capital city of Bhubaneswar. However, with the devastation caused by the cyclone of 1999, these places need revival from the commercial point of view (Panigrahi, 2002).

    Wildlife lovers have long known of the lion safari and white tiger safari of Bhubaneswar, the majestic Mahanadi gorge at Tikarapara, with the added attraction of the Crocodile Sanctuary, and the migration of millions of Olive Ridley turtles to Gahirmatha twice a year to lay eggs. Orissa also has the bird paradise of Chilika Lake, which is the largest brackish water lake in Asia. Precipitous waterfalls at a number of places - including Bagra, Duduma, Harishankar, Nrusimhanath, Pradhanpat, Khandadhar, Berehipani, and Joranda - are ideal for summer tourism. Also for summer, are the beaches of Orissa stretching over 400 kilometres from Chandaneswar to Gopalpur. They are still undeveloped and rated among the best in the world. By comparison, winter tourism may focus on the hot sulphur springs at Atri, Taptapani, Deulajhari and Tarabalo. The winter tableau may also be experienced in places resembling the Himalayan valley - that is, Daringibadi in Phulbani district and the Sunabeda plateau in Koraput district.

    The traditional fairs and festivals of Orissa, observed with colourful ceremony, include Rathayatra at Puri, Dhanu Yatra at Bargarh, Sitalsasthi at Sambalpur, Nila Parva at Chandaneswar, and the Chhou dance at Baripada. The State is also rich in folk dances, including Odissi, Gotipua Nacha, Palla, and Danda Nacha. Tribal folk dances such as 'dhemsa' and 'chau', plus other different forms, enrich the folk dance repertoire of the State. In addition to these traditional dances, special dance and cultural programs like the Konark Festival (at Konark), the Adivasi Festival at Bhubaneswar, and the beach festival at Puri, are also organised every year. The Zilla Mahostavas organised every year in different districts and the district level cultural festivals (such as Parav in Koraput and Malyabanta in Malkangiri) also attract tourists locally and from further afield. Souvenirs of cultural interest are made by the tie and dye textiles of Western Orissa, popularly known as sambalpuri textiles, the appliqué works of Pipili, the horn and soap stone works of Puri, the patta paintings of Raghurajpur and the silver filigree of Cuttack.

    At the commencement of the Sixth Five-Year Plan (1980-1985) sustained efforts were made to improve the infrastructure for the promotion of tourism in the State. The hotel industry increased the number of rooms available as well as their price range. In 1980 there were only 188 hotels in Orissa with a total of 3,202 rooms; in 1999 (during the Ninth Five-Year Plan, 1997-2002) the figures rose to 733 hotels accounting for 14,939 rooms. The tourism industry benefits from an international airport at Bhubaneswar, with direct or convenient air links with Delhi, Bombay, Calcutta, Madras, Hyderabad, and other cities, plus fast train services to tourist destinations of the State (Government of Orissa, 2002). This has helped increase both domestic and foreign tourism into the State (see Table 1) and associated spending while in Orissa (see Table 2) (Government of Orissa, 2002). The employment opportunities in this sector have also increased. Tourism in the State generated a rise in employment from 26,695 persons in the year 1996-97, to 46,103 persons in the year 2000-2001 (Government of Orissa, 2002). This clearly indicates the employment potential of the tourism sector.



    III: Ethno-Cultural Resources of the Tribal Communities in Orissa

    Orissa has a large tribal population: out of India's 427 Scheduled Tribes, Orissa accounts for 62 tribal communities who constitute 27.08 percent of State's population (2001). The tribal communities living in the State range from small communities like Chenchu, Bonda, Juanga, Didayi, to large communities like MundaSantalas, Kondh, Oraon, Saora and Bhuyan. Almost 44.21 percent of the total land area of the State has been Constitutionally declared as a Scheduled Area, which covers most of the districts except the coastal and few in-land areas. The districts largely dominated by Scheduled Tribes are Malkangiri (58.51%), Mayurbhanja (57.87%), Nawarangpur (55.26%), Rayagada (54.99%), Sundargarh (50.74%), Koraput (50.67%), Kondhaland (50.13%), Keonjhar (44.62%), Gajapati (47.88%), and Jharsuguda (33.31%) (1991 Census of India). The tribal communities of the State can be categorised as hunter-gatherer-nomads; hunter-gatherer and shifting cultivators; simple artisans; settled agriculturists; industrial and urban unskilled and semi-skilled workers (Behura, 1990-93).

    The Scheduled Tribe communities differ in their political, economic and socio-cultural life. However, these communities have similarities as regard their dependency on nature to collect their livelihood requirements and in adherence to nature-spirit belief complexes. A few tribal communities including the Birhor, Kondh and Paudi Bhuyan are also found beyond the State boundaries and are distributed in the States of Jharkhand, Chhatishgarh, Assam and West Bengal. Many of these communities belong to the Austric sub-family of the Austro-Asiatic language family. Almost all are divided into sub-groups who reside on hill-tops and hill slopes. They tend to be patrilineal, partilocal, patriarchal and possess both nuclear and extended forms of family, patri-lineages and clans. For them, marriage by negotiation is always considered as socially approved and most prestigious. However, they also pursue other methods, such as marriage by capture, marriage by exchange and marriage by service. Since these tribal communities are conservative and tradition-bound, their social organisation and marriages are basically regulated by clans or similar organisations like Birinda (among the Saoras). Any breach of customary practices by the members results in social excommunication and imposition of fines. The secular and sacerdotal village functionaries, known differently among different communities, perform the role of village head, priest, medicine man, shaman, and look after their politico-jural and religious functions. The ethnic identities of these communities are reflected through their dress pattern, housing structure, ornaments, god, goddess and spirits of both benevolent and malevolent nature.

    Primitive Tribal Communities of Orissa

    Of the 62 Scheduled Tribes, the State has declared 11 tribal communities as Primitive Tribal Groups. These communities are: Bonda Paraja, Chuktia Bhunjia, Didayi, Dongaria Kondha, Hill Kharia (also known as Mankiridia, BirhorJuanga, Kutia Kondh, Lanjia Saora, Lodha, Paudi Bhuiyan and Saora. Each of these tribal communities is rich in social institutions, socio-cultural profile and ethnic identity, as noted below:

    BIRHOR: In Orissa, Birhors are mainly distributed in the districts of Sambalpur, Sundargarh, Balasore, Cuttack, Ganjam. The meaning of the term Birhor in their language isBir (forest) and Hor (men) - i.e. men of the forest. They are traditionally semi-nomadic hunter-gatherers and their economy is subsistence-oriented. They are divided into the nomadic Uthlas and the settled Jagi. The wandering group has a temporary habitation, known as the Kumbha, made of twigs and leaves and a cluster of Kumbhas for 10-15 households, giving rise to a temporary camp-site, known as the Tanda. The forest and the Birhor are inter-connected since time immemorial, as their basic survival is dependent upon the forest eco-system. Their social organisation popularly known as Tanda is multi-clan, and does not have any restriction for marriage within a Tanda. Each Tanda has a headman who plays simultaneously secular and sacerdotal roles. The Birhors are polytheists as they believe in and perform rituals for a number of deities and spirits, both benevolent and malevolent. They worship ancestral cults at regular intervals for their safety and social security.

    The Birhor are interchangeably known as the Mankirdia (in Sambalpur and Mayurbhanj districts), and Mankidi (in Kalahandi and Sundargarh), as they are expert monkey catchers. Because of their pre-agricultural economy and low literacy, they have been identified as one of the Primitive Tribal Groups. Since the Fifth Plan, the Union Government has been exerting itself to bring them to sedentary settlement from their nomadic/semi-nomadic habitat through planned development intervention.


    BONDO: The Bondo are only found in Orissa State. They are the speakers of the 'Kemo language which belongs to the Austro-Asiatic language family. There are three sub-groups: the Bondo highlanders, Lower Bondo and the Gadaba-Bondo group. The Bondo villages are found in hilltops and hill slopes, as well, and their economic life centres on cultivation, both shifting and settled. Their social organisation consists of such social institutions as clans, lineage groups, extended families and nuclear families. There are a number of village functionaries, both secular and sacerdotal, namely the priest, medicine man, and shaman, to look after the politico-jural and religious functions in their society. The Patkhanda Maha-pravu is their presiding deity and a number of deities and spirits are also worshipped from time to time. Although liquor is prohibited for use in various religious rituals, animal sacrifice is not tabooed.

    The Bondo observe a number of rituals and ceremonies throughout the year. They use scanty clothes and especially the womenfolk traditionally use country-made ringa ofkerang fibre. They wear a number of coloured bead necklaces hanging from the neck to the navel, and in addition there are bangles, neck and head-bands, anklets, and rings. The Bondo, both men and women, have shown increasing interest in participating in the ongoing development processes.

    CHUKTIA BHUNJIA: The Chuktia Bhunjia are members of the Bhunjia tribal groups, concentrated in the Sonabera plateau of Kalahandi (old) district, which is located at an altitude of approximately 3,000 feet above the sea level. The area is distinguished by high and undulating hill ranges, streams and dense forest. It is a sparsely populated area with small, dispersed villages and hamlets. Their erstwhile practice of shifting cultivation has affected the landscape of the region; and now the Chuktia Bhunjia earn their livelihood through the collection and sale of minor non-timber forest produce.

    The Chuktia section of the Bhunjia is more conservative, tradition-bound and inward-looking. They have a number of exogamous units or clans, which regulate their marriage. A simple/nuclear family with a monogamous form of marriage is found in their society. Their kitchen shed is considered sacred and the entry of married daughters into the kitchen is strictly forbidden. Traditionally, the socio-political system recognised the village council with elderly members as the basic unit and there existed the inter-village council at the apex. The Bhunjias worship the Sunadei as their supreme deity and the Pujari performs the priestly functions. Besides this, a large number of deities are propitiated for the tribe's well-being and prosperity, prevention and cure from diseases, and good crops. Both the region and the community attract tourists during winter.

    DIDAYI: The Didayi is an ethnic group that occupies the area of the Konda Kamberu hill ranges and the Machhkund River. Their habitat constitutes riverine plains, undulating plateau and rugged mountainous terrain. Economically, they are mostly subsistence-oriented, attuned to the environment, and they earn their livelihood through food-gathering, hunting, fishing, domestication of animals, cultivation (both settled and shifting), and wage-earning. In their politico-jural arrangements, the Naik officiates as the secular chief of the traditional village Panchayat. They believe in a large number of gods and goddesses, demi-gods and spirits and the palasi is their sacred Chief. TheDidayis are patriarchal, patrilineal and patrilocal and their social organisation comprises of clans, which are characteristically totemistic and include lineage, consisting of a number of families. Although monogamy is the rule, polygamous unions are practised, as per need and the cross-cousin marriage is a preferential form of marriage among them. Also prevalent are marriage by mutual consent and elopement (udlia), marriage by capture (cubboi), marriage by intrusion (gaisamuddi) and marriage by service (garijya). The bride price, although not uniform in all cases of marriages, is paid to the bride's parents. Divorce is socially permissible and remarriages of widow/widower, divorcee/separated are also allowed.

    DONGRIA KANDHA: The Dongria Kandha, members of the Kandha tribe of Orissa, are found in the Niyamgiri hill ranges of the Eastern Ghats and particularly in the Rayagada and Koraput districts. Dongria Kandhas speak a language, called the kuvi, which is of Dravidian linguistic ancestry. They are able horticulturists and grow jackfruit, mango, pineapple, banana, citrus fruits, ginger, and turmeric. Besides horticulture, they earn their livelihood through shifting cultivation along hill slopes, collection of materials from forests, animal husbandry and wage-earningThe Dongria Kandhas are patrilineal and patriarchal; they have nuclear families, extended families, lineage and clans. Although marriage by negotiation appears to be more prestigious, they too have other ways of acquiring marriage partners, such as the marriage by capture, exchange, or service. Their economies centre round the dongar - hill slopes of shifting cultivation and the dongar is the abode of their deities and supernatural beings. It provides them also with a metaphor for their worldview.

    The secular and sacerdotal chieftainship continues to enjoy confidence and esteem. The Bismajhi, Barika, Pujari, Disari, Bejuni, Jhateni and Gouda are the other village functionaries who play specific roles in various contexts. The theological pantheon of the Dongria Kandha has the 'Dharni penu', the earth goddess, at the apex and in addition there are a large number of village deities, ancestral cults, household deities, and spirits (both benevolent and malevolent). Deities and spirits are propitiated for their blessings, and rituals and ceremonies are observed throughout the year. Dongria Kandhas employ traditional knowledge of the causes and cure of diseases and ailments, and consult their Disari, the medicine man, at times of need.


    JUANG: The Juang are found only in Orissa State, concentrated in the districts of Keonjhar (the Thaniya section) and Dhenkanal (the Bhagudiya section). Gonasika, which is situated in Keonihar district, is the principal seat of the tribe. The Gonasika area constitutes sedentary landscape with hills, slopes, ridges, and valleys. The vegetative cover in the area ranges from barren to thin forest, within a sub-tropical monsoon climate. The Gonasika (meaning 'cow's nostril') marks the origin of the river Baitarani. TheJuang speak a language classified under the Munda, belonging to the Austric subfamily of the Austro-Asiatic language family.

    They have patrilineal and totemistic septs/clans, which have two broad divisions, namely the Kutumb/Bhai septs (non-intermarrying/consanguineous) and the Bandbu septs(intermarrying/affinal). Their secular and sacerdotal chiefs are the Pradhan and Nagam/Boita, respectively. They are polytheists and the two principal deities are the Dharam Debta/Mahapuru and the Dharti Mata/Basuki. The Rushi (benefactor) and the Rushain (benefactoress) are considered as the deified tribal heroes (Elwin 1948). There are also deities presiding over villages, hills, rivers, and forest. Ancestral cults are also in evidence. Interestingly, there is an absence of the practice of witchcraft and sorcery. They observe a number of rituals, ceremonies and festivals throughout the year. The Juang consider the neighbouring tribal group, the Bhuiyan, as their brothers.

    KHARIA: The Pahari/Hill Kharia, members of Kharia tribe, are considered the most 'backward' insofar as their economic status is concerned. The Hill Kharias are the autochthonous inhabitants of the Similipal hill ranges of Mayurbhanj district. They live in small villages consisting of roughly 20 to 30 households and their villages are found scattered on hilltops, hill slopes and foothills. The subsistence economy of the Hill Kharia centres on the collection of minor forest produce, such as resin, honey, bees' wax, lac, tusser cocoon, and hunting. The Kharia family is patrilineal, patriarchal and patrilocal and there is a preponderance of nuclear families. As with the other tribes, marriage by negotiation is preferred. Bride price is practised; and widow remarriage and divorce are socially allowed. The Hill Kharias consider the earth goddess,Thakurani, as their supreme deity. They also believe in a number of deities and spirits, propitiating them through performance of rituals. The Pradhan heads the traditional socio-political organisation; and both village-level and inter-village level councils attend to the internal and external affairs of the community.

    KUTIA KANDHA: The Kutia Kandha is a sub-section of the Kandha tribal group of Orissa and they are mainly concentrated in Belghar area of the Balliguda subdivision in Phulbani district. Their habitat is located in the north-eastern fringe of the Eastern Ghats and contains hills, rivers and streams. The area is approximately 3,000 feet above sea level. Patrilineality, patriarchy and patrilocality prevail in Kutia Kandha villages. They have nuclear and extended families, lineage, clans and clan exogamy regulates marriage. The secular functionaries are the Mutha Majhi, Pat Majhi, Bis Majhi and Chhatia; while the Jani is the sacerdotal head. The Kutia Kandhas are polytheists and believe in a large number of deities, spirits, supernatural elements, both benevolent and malevolent. They propitiate their deities and spirits through performance of rituals for their blessings. They observe various ceremonies and festivals throughout the year and perform magico-religious rituals as per the prescription of the Jani. 

    The techno-economic base of the Kutia Kandha is centred on the sylvan forest eco-system. They practise slash-and-burn cultivation, otherwise known as 'podu chas', and also grow crops in wet cultivation, horticultural plantations, animal husbandry and wage-earning for their livelihood. The Kutia Kandha women play a significant role in socio-economic, socio-religious and socio-cultural system maintenance. 

    LODHA: In Orissa, the Lodhas are concentrated in two areas, namely Morada and Suliapada in the Sadar subdivision of Mayurbhanj district. They are originally a Mundari speaking tribe. Their economy is subsistence-oriented and depends upon the collection of minor forest produce, wage-earning and agricultural labour. The Lodha social organisation is characterised by patrilineal and totemistic clans, and most of the families are nuclear. Their marriages are usually post-pubescent and monogamous, although polygynous unions are not totally ruled out. Divorce and remarriage are socially permissible. In the socio-political domain, the Mukhia/Sardar plays the role of headman and the traditional village Panchayat is called Desh. The Lodhas are polytheists. Like other tribes, they have village deities, tutelary deities, ancestral cults, benevolent and malevolent spirits, and all of them constitute the supernatural constellation. The Lodhas observe a number of rituals and festivals throughout the year to gain the favour of spirits and the blessings of deities for their overall well-being.

    PAUDI BHUYAN: The Bhuyan is one of the major tribes of Orissa. They are found in the districts of Keonjhar, Sundargarh, Mayurbhanj and Sambalpur and are chiefly concentrated in the Bhuyan pirha of Keonjhar district and Bonai subdivision of Sundargarh district. Their habitat constitutes hilly terrain and valleys.

    They practise a slash-and-burn type of cultivation (Kamani) on hill slopes, settled cultivation on wetlands and vegetable cultivation in kitchen gardens. They also collect food materials, fuel wood, honey, resin Iac, medicinal plants and herbs from the forest. Monogamy is the norm and marriage by negotiation is preferred but not always adhered to. There is the prevalence of a bride price, which is paid to the bride's father in cash and/or kind. Their family, which is the smallest social unit, is characterised by patriarchy, patrilocality and patrilineality. The tribe functions according to lineage and clans. The village head is called the Naik/Padhan, who presides over the village assembly, or Darbar; and the inter-village traditional political organisation is known as the Bar in the Sundargarh district and Pirh in the Keonjhar district. The Dharam Devta and Basukimata, who represent Sun and Earth, respectively, are at the apex of their pantheon. The Dihuri is the sacerdotal chief, who performs all rituals connected with worship of deities. When sickness arises, the tribe applies magico-religious methods through Raulia, the witch doctor, and utilises medicinal plants and herbs.


    SAORA: The Saora is one of the major tribes of Orissa and they speak a language, Sora, which can be classified under the Austro-Asiatic language family. They are found in almost all districts of the State, but are chiefly concentrated in Gajapati and Rayagada districts. The Saoras have been classified into various groups. The Lanjiya Saorasare the more 'primitive' group and the Sudha Saoras are a Hinduised acculturated group (Mohanty 1990: 249-50).

    The Saora family is patriarchal, patrilocal and patrilineal. Unlike other tribal groups, the Saora do not have a clan system. Instead, they have another institution, called theBirinda, a patrilineage that performs the functions of the clan. Moreover, the Birinda is exogamous and regulates marriage, inheritance and succession. A Saora woman'sBirinda does not change after her marriage and after the death of a woman, her Birinda members have the right to perform her death rituals.

    Although monogamy is the rule, polygynous unions are also prevalent. Besides marriage by negotiation, marriage by ceremonial capture occurs. Various life-cycle rituals are observed as per their customs and the Guar ceremony as a death ritual is significant among them. The Saoras practise shifting, terrace and settled cultivation, collect minor forest produce, pursue animal husbandry, horticulture, and wage earning. The Saoras are noted for their iconography, craftsmanship and their rich cultural heritage.


    IV: The Tribal Museum

    The Scheduled Castes and Scheduled Tribes Research and Training Institute (thus known as SC & STR & TI) is one of the State level agencies working for tribal development in the State. This Institute started as a semi-official organisation in 1952 when it was known as Tribal Research Bureau. The objective of this Bureau was to collect and process basic data on various aspects of the culture processes of scheduled groups in the State of Orissa, and render advisory services to both the Government of Orissa and the Government of India on matters of their socio-economic development.

    The concept of the 'Museum of Men' at the Institute was started in 1986 and Government of Orissa thought to take the idea further and establish a museum. Accordingly, five typical huts were made representing the Santhal, Juanga, Gadaba, Saora, and Dangaria Kondh while also displaying their artefacts. There are 2038 artefacts collected from among 21 tribal communities of Koya, Gondia, Ganda, Didayi, Kohva, Bhumija, Dangaria Kondha, Kutia Kondha, Juanga, Pauri Bhuiyan, Santhal, Oraon, Khadia-Mankiridia, Bathudi, Gond, Pahadia, Gadaba, and Bonda. The collected artefacts can be classified as hunting weapons, fishing tools, agriculture implements, household items, jewellery, textile, musical instruments, combs, dhokara, basketrygourd items, wood carving, and decorative objects. All these artefacts have been displayed on their functional basis relating to agriculture, hunting, and music. The collections on each artefact are not sufficient to show the evolutionary process/form during the display. The Institute has adopted four types of card system (index card, chemical card, documentation card, and exhibition card) to develop a documentation process of all 2038 artefacts; while the chemical conservation method is used to preserve the artefacts.

    Tribal House replications (Santhal at left and Juang above) at the Museum Of Tribal Arts and Artefacts (Orissa)

    (Photo copyrights R. James Ferguson 2002)


    An attempt was made to review the register of the visitors to the museum from the period of 1990 to 1998. During the period the museum attracted a mere 313 tourists, though we can assume that not all visitors signed the register. Of the total, 271 (86.58%) came from abroad (see Table 3), while only 36 (11.50%) came from other States of India, and the rest were from different districts of Orissa (SC and ST R and TI Museum Record, 2000). While total visitor numbers were small, the majority were foreign tourists. This indicates the as yet unrealised potential for development of ethno-tourism in Orissa, especially among foreign tourists.


    Conclusion and Recommendations

    The state of Orissa can be a successful tourist destination if the industry is encouraged. So far, tourism has been developed by the State in coastal regions and a few inland sites. The State Government has not given due and appropriate importance to develop and/or enrich tourism from an ecological and cultural point of view. For this reason, the following recommendations are made:

    • Attempts should be made to conserve the physical ecology as well as the cultural ecology of the ethnic tribal communities by empowering them through a participatory protected area management approach.
    • There should be a crackdown on illegal encroachments of the heritage sites. Permission for construction of structures within these zones should be denied.
    • The ethnic communities should be encouraged to enrich their ethnic heritage and skills so as to make their traditions more attractive rather than less in the face of change. Eco-tourism (inclusive of its ethno component) should provide an opportunity for these tribal communities to generate more income from the tourism business in a dignified manner.
    • The whole approach of cultural integrity of the tribal communities and tourism should be honoured on the basis of right perspective for the tribal communities, not merely on income generation perspective for the State. The fabric of native culture reflected through folklore, folk music, folk dance, and customs should be promoted through required value addition.
    • Studies should be conducted to establish the possible effects of eco-tourism on the tribal people and their cultural life.
    • Development of infrastructure and safety measures in the interior of the State should be of prime importance in the intervention to establish eco-tourism in the State.
    • Greater investment should be made in the promotion and preservation of monuments with cultural, historical and mythological significance.
    • Overall, the eco-tourism of the State should effectively protect indigenous people and cultures from external threats; recognise their traditional rights on land and water; recognise their rights to control and co-manage these resources; allow participation of traditional institutions in the management of natural resources; and recognise the rights of these people to determine their own development priorities.



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    Table 1: Distribution of Tourist flow to Orissa in different years


    Domestic Tourists

    Foreign Tourists


































    Source: Govt. of Orissa, Dept. of Tourism and Culture, Bhubaneswar.


    Table 2: Distribution of tourist spending in Orissa in different years (In Crore)





































    Source: Govt. of Orissa, Dept. of Tourism and Culture, Bhubaneswar.


    Table 3: Distribution of Foreign Tourists who visited Museum of Men at SC and ST R and TI at Bhubaneswar.

    Sl No

    Foreign countries

    No of Foreign Tourists

    Per cent of Foreign Tourists














    The Netherlands












































    Other countries







    Source: Govt of Orissa, SC and ST R and T I, Museum Records. 1998.


    Centre for East-West Cultural and Economic Studies,

    Bond University (Australia),

    Research Paper No. 11, February 2005,

    Copyright © Nilakantha Panigrahi 2004-2005

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    The Constitution of India (Hindi: भारतीय संविधान, see names in other Indian languages) is the supreme law of India. It lays down the framework defining fundamental political principles, establishes the structure, procedures, powers and duties, of the government and spells out the fundamental rights,directive principles and duties of citizens. It is the longest[1] written constitution of any sovereign country in the world, containing 448 articles in 22 parts, 12 schedules and 94 amendments,[2][3] for a total of 117,369 words in the English language version. Besides the English version, there is an official Hinditranslation.

    Passed by the Constituent Assembly on 26 November 1949, it came into effect on 26 January 1950.[4]The date 26 January was chosen to commemorate the declaration of independence of 1930. It declares the Union of India to be a sovereignsocialistseculardemocratic republic, assuring its citizens ofjusticeequality, and liberty and, endeavors to promote among them all, fraternity. The words "socialist", "secular", and "integrity" were added to the definition in 1976 by constitutional amendment.[5] India celebrates the adoption of the constitution on 26 January each year as Republic Day.[6] After coming into effect, the Constitution replaced the Government of India Act 1935 as the governing document of India.




    The majority of the Indian subcontinent was under British colonial rule from 1858 to 1947. This period saw the gradual rise of the Indian independence movement to gain independence from foreign rule. The movement culminated in the formation of the Dominion of India on 15 August 1947, along with the Dominion of Pakistan. The constitution of India was adopted on 26 November 1949 and came into effect on 26 January 1950, proclaiming India to be a sovereign, democratic republic. It contained the founding principles of the law of the land which would govern India after its independence from British rule. On the day the constitution came into effect, India ceased to be a dominion of the British Crown.

    [edit]Evolution of the Constitution

    [edit]Acts of British Parliament before 1935

    After the Indian Rebellion of 1857, the British Parliament took over the reign of India from the British East India Company, and British Indiacame under the direct rule of the Crown. The British Parliament passed the Government of India Act of 1858 to this effect, setting up the structure of government in India. It established in England the office of the Secretary of State for India through whom Parliament would exercise its rule, along with a Council of India to aid him. It also established the office of the Governor-General of India along with an Executive Council in India, consisting of high officials of the British Government. The Indian Councils Act of 1861 provided for a Legislative Council consisting of the members of the Executive council and non-official members. The Indian Councils Act of 1892 established provincial legislatures and increased the powers of the Legislative Council. These acts increased the representation of Indians in the government, however their power remained limited. The Government of India Acts of 1909 and 1919 further expanded participation of Indians in the government.

    [edit]Government of India Act 1935

    The provisions of the Government of India Act of 1935, though never implemented fully, had a great impact on the constitution of India. Many key features of the constitution are directly taken from this Act. The federal structure of government, provincial autonomy, bicameral legislature consisting of a federal assembly and a Council of States, separation of legislative powers between the center and provinces are some of the provisions of the Act which are present in the Indian constitution.

    [edit]The Cabinet Mission Plan

    In 1946, British Prime Minister Clement Attlee formulated a cabinet mission to India to discuss and finalize plans for the transfer of power from the British Raj to Indian leadership as well as provide India with independence under Dominion status in the Commonwealth of Nations.[7][8] The Mission discussed the framework of the constitution and laid down in some detail the procedure to be followed by the constitution drafting body. Elections for the 296 seats assigned to the British Indian provinces were completed by August 1946. The Constituent Assembly first met and began work on 9 December 1946.

    [edit]Indian Independence Act 1947

    The Indian Independence Act, which came into force on 18 July 1947, divided British Indian territory into two new states: India and Pakistan, which were to be dominions under the Commonwealth of Nations until their constitutions came into effect. The Constituent Assembly was divided into two for the separate states. The Act relieved the British Parliament of any further rights or obligations towards India or Pakistan, and granted sovereignty over the lands to the respective Constituent Assemblies. When the Constitution of India came into force on 26 January 1950, it repealed the Indian Independence Act. India ceased to be a dominion of the British Crown and became a sovereign democratic republic. 26 November 1949 is also known as National Law Day.

    [edit]Constituent Assembly

    The Constitution was drafted by the Constituent Assembly, which was elected by the elected members of the provincial assemblies.[9]Jawaharlal NehruC. RajagopalachariRajendra PrasadSardar Vallabhbhai PatelDr AmbedkarMaulana Abul Kalam AzadShyama Prasad Mukherjee and Nalini Ranjan Ghosh were some important figures in the Assembly. There were more than 30 members of scheduled classes. Frank Anthony represented the Anglo-Indian community, and the Parsis were represented by H. P. Modi. The Chairman of the Minorities Committee was Harendra Coomar Mookerjee, a distinguished Christian who represented all Christians other than Anglo-Indians. Ari Bahadur Gururng represented the Gorkha Community. Prominent jurists like Alladi Krishnaswamy IyerB. R. AmbedkarBenegal Narsing Rau and K. M. MunshiGanesh Mavlankar were also members of the Assembly. Sarojini Naidu, Hansa Mehta, Durgabai Deshmukh andRajkumari Amrit Kaur were important women members. The first president of the Constituent Assembly was Sachidanand Sinha later,Rajendra Prasad was elected president of the Constituent Assembly.[9] The members of the Constituent Assembly met for the first time in 1946 on 9 December.[9]


    In the 14 August 1947 meeting of the Assembly, a proposal for forming various committees was presented. Such committees included a Committee on Fundamental Rights, the Union Powers Committee and Union Constitution Committee. On 29 August 1947, the Drafting Committee was appointed, with Dr Ambedkar as the Chairman along with six other members. A Draft Constitution was prepared by the committee and submitted to the Assembly on 4 November 1947.

    The architects of India's constitution, though drawing on many external sources, were most heavily influenced by the British model ofparliamentary democracy. In addition, a number of principles were adopted from the Constitution of the United States of America, including the separation of powers among the major branches of government, the establishment of a supreme court, and the adoption, albeit in modified form, of a federal structure (a constitutional division of power between the union [central] and state governments)

    The Assembly met in sessions open to the public, for 166 days, spread over a period of 2 years, 11 months and 18 days before adopting the Constitution.[6] After many deliberations and some modifications, the 308 members of the Assembly signed two hand-written copies of the document (one each in Hindi and English) on 24 January 1950. Two days later, the Constitution of India became the law of all the Indian lands.

    The Constitution has undergone 94 amendments in the 60 years since its enactment.[3]


    The Constitution, in its current form, consists of a preamble, 22 parts containing 444 articles, 12 schedules, 2 appendices[10] and 94 amendments to date.[3] Although it is federal in nature with strong unitary bias, in case of emergencies it takes unitary structure.


    Parts are the individual chapters in the Constitution, focusing on specific issues of law.


    Schedules are lists in the Constitution that categorize and tabulate bureaucratic activity and policy of the Government.

    • First Schedule (Articles 1 and 4) — States and Union Territories  – This lists the states and territories on of India, lists any changes to their borders and the laws used to make that change.
    • Second Schedule (Articles 59, 65, 75, 97, 125, 148, 158, 164, 186 and 221) — Emoluments for High-Level Officials  – This lists the salaries of officials holding public office, judges, and Controller and Auditor-General of India.
    • Third Schedule (Articles 75, 99, 124, 148, 164, 188 and 219) — Forms of Oaths  – This lists the oaths of offices for elected officials and judges.
    • Fourth Schedule (Articles 4 and 80)  – This details the allocation of seats in the Rajya Sabha (the upper house of Parliament) per State or Union Territory.
    • Fifth Schedule (Article 244)  – This provides for the administration and control of Scheduled Areas[Note 1] and Scheduled Tribes[Note 2](areas and tribes needing special protection due to disadvantageous conditions).
    • Sixth Schedule (Articles 244 and 275)— Provisions for the administration of tribal areas in Assam, Meghalaya, Tripura, and Mizoram.
    • Seventh Schedule (Article 246) — The union (central government), state, and concurrent lists of responsibilities.
    • Eighth Schedule (Articles 344 and 351) — The official languages.
    • Ninth Schedule (Article 31-B) - Articles mentione here are immune from judicial review.
    • Tenth Schedule (Articles 102 and 191) — "Anti-defection" provisions for Members of Parliament and Members of the State Legislatures.
    • Eleventh Schedule (Article 243-G) — Panchayat Raj (rural local government).
    • Twelfth Schedule (Article 243-W) — Municipalities (urban local government).

    [edit]System of government

    Dr. Bhimrao Ramji Ambedkar was the chairman of the Constitution Drafting Committee.

    The basic form of the Union Government envisaged in the Constitution is as follows,

    "A democratic executive must satisfy three conditions:

    1. It must be a stable executive, and
    2. It must be a responsible executive.
    3. It must be impartial to all religion, caste and community. Unfortunately, it has not been possible so far to devise a system which can ensure both conditions in equal degree. ..... The daily assessment of responsibility, which is not available in the American system is, it is felt, far more effective than the periodic assessment and far more necessary in a country like India. The Draft Constitution in recommending the parliamentary system of Executive has preferred more responsibility to stability.[19]


    [edit]Federal Structure

    The constitution provides for distribution of powers between the Union and the States.

    It enumerates the powers of the Parliament and State Legislatures in three lists, namely Union list, State list and Concurrent list. Subjects like national defense, foreign policy, issuance of currency are reserved to the Union list. Public order, local governments, certain taxes are examples of subjects of the State List, on which the Parliament has no power to enact laws in those regards, barring exceptional conditions. Education, transportation, criminal law are a few subjects of the Concurrent list, where both the State Legislature as well as the Parliament have powers to enact laws. The residuary powers are vested with the Union.

    The upper house of the Parliament, the Rajya Sabha, which consists of representatives of States, is also an example of the federal nature of the government.

    [edit]Parliamentary Democracy

    The President of India is elected by the Parliament and State Legislative Assemblies, and not directly by the people. The President is theHead of the State, and all the business of the Executive and Laws enacted by the Parliament are in his/her name. However, these powers are only nominal, and the President must act only according to the advice of the Prime Minister and the Council of Ministers.

    The Prime Minister and the Council of Ministers exercise their offices only as long as they enjoy a majority support in the Lok Sabha, the lower house of the Parliament, which consists of members directly elected by the people. The ministers are answerable to both the houses of the Parliament. Also, the Ministers must themselves be elected members of either house of the Parliament. Thus, the Parliament exercises control over the Executive.

    A similar structure is present in States, where the directly elected Legislative Assembly enjoys control over the Chief Minister and the State Council of Ministers.

    [edit]Independent Judiciary

    The Judiciary of India is free of control from either the executive or the Parliament. The judiciary acts as an interpreter of the constitution, and an intermediary in case of disputes between two States, or between a State and the Union. An act passed by the Parliament or a Legislative Assembly is subject to judicial review, and can be declared unconstitutional by the judiciary if it feels that the act violates some provision of the Constitution.

    Constitutional remedy against any action of the government is available in a High Court or the Supreme Court, if the action violates any of the fundamental rights of an individual as enumerated in the Constitution.

    [edit]Original Unamended Constitution of India

    The original constitution of India without any amendments can be found here: Original Unamended version of the Constitution of India

    [edit]Changing the constitution

    Amendments to the constitution are made by the Parliament, the procedure for which is laid out in Article 368. An amendment bill must be passed by both the Houses of the Parliament by a super-majority consisting of 2/3rd of the members present and voting, and half of the total membership of the House. In addition to this, certain amendments which pertain to the federal nature of the Constitution must be ratified by a majority of state legislatures.

    As of September 2010, there have been 108 amendment bills presented in the Parliament, out of which 94 have been passed to become Amendment Acts.[3] Most of these amendments address issues dealt with by statute in other democracies. However, the constitution is so specific in spelling out government powers that many of these issues must be addressed by constitutional amendment. As a result, the document is amended roughly twice a year.

    The Supreme Court has ruled that not every constitutional amendment is permissible. An amendment must respect the "basic structure" of the constitution, which is immutable.

    In 2000 the National Commission to Review the Working of the Constitution (NCRWC)[20] was setup to look into updating the constitution.

    [edit]Judicial review of laws

    Judicial review is adopted in the Indian constitution from the constitution of the United States of America. In the Indian constitution, Judicial Review is dealt with under Article 13. Judicial Review refers that the Constitution is the supreme power of the nation and all laws are under its supremacy. Article 13 states that

    1. All pre-constitutional laws, after the coming into force of constitution, if in conflict with it in all or some of its provisions then the provisions of constitution will prevail and the provisions of that pre-constitutional law will not be in force until an amendment of the constitution relating to the same matter. In such situation the provision of that law will again come into force, if it is compatible with the constitution as amended. This is called the Theory of Eclipse[citation needed].

    2. In a similar manner, laws made after adoption of the Constitution by the Constituent Assembly must be compatible with the constitution, otherwise the laws and amendments will be deemed to be void-ab-initio.

    In such situations, the Supreme Court or High Court interprets the laws as if they are in conformity with the constitution. If such an interpretation is not possible because of inconsistency, and where a separation is possible, the provision that is inconsistent with constitution is considered to be void. In addition to article 13, articles 32, 124, 131, 219, 228 and 246 provide a constitutional basis to the Judicial review in India.[citation needed]


    1. ^ Scheduled Areas are autonomous areas within a state, administered federally, usually populated by a predominant Scheduled Tribe.
    2. ^ Scheduled Tribes are groups of indigenous people, identified in the Constitution, struggling socio-economically

    [edit]See also


    1. ^ Pylee, M.V. (1997). India's Constitution. S. Chand & Co.. pp. 3.ISBN 812190403X.
    2. ^ "Constitution of India". Ministry of Law and Justice of India. July, 2008. Retrieved 2008-12-17.
    3. a b c d "THE CONSTITUTION (AMENDMENT) ACTS"India Code Information System. Ministry of Law, Government of India. Retrieved 14 July 2010.
    4. ^ "Introduction to Constitution of India". Ministry of Law and Justice of India. 29 July 2008. Retrieved 2008-10-14.
    5. ^ "Forty-Second Amendment to the Constitution". Ministry of Law and Justice of fishys. 28 August 1976. Retrieved 2008-10-14.
    6. a b Das, Hari (2002). Political System of India. Anmol Publications. pp. 120. ISBN 8174886907.
    7. ^ Mansergh, Nicholas; Moon, Penderel (1977). The Transfer of Power 1942-7 .Vol VIIHer Majesty's Stationery Office, London.ISBN 9780115800825.
    8. ^ "Parliamentary Archives: HL/PO/1/595/11"Parliament and India, 1858-1947. British Parliamentary Archives. Retrieved 2008-10-15.
    9. a b c "The Constituent Assembly Debates (Proceedings):(9th December,1946 to 24 January 1950)". The Parliament of India Archive. Retrieved 2008-02-22.
    10. ^ "CONSTITUTION OF INDIA"Ministry of Law and Justice, Govt. of India.
    11. ^ Part I
    12. ^ Part II
    13. ^ Part IV
    14. ^ Part V
    15. ^ Part VI
    16. ^ Part VII
    17. ^ Part VIII
    18. ^ Part IX
    19. ^ Ahir, D.C. (1990). The legacy of Dr Ambedkar (10th ed.). South Asia Books. pp. 75–76. ISBN 978-8170186038.
    20. ^


    • Baruah, Aparajita (2007). Preamble of the Constitution of India : An Insight & Comparison. Eastern Book Co. ISBN 9788176299960.
    • Basu, Durga Das (1965). Commentary on the constitution of India : (being a comparative treatise on the universal principles of justice and constitutional government with special reference to the organic instrument of India)1 - 2. S. C. Sarkar & Sons (Private) Ltd.
    • Basu, Durga Das (1984). Introduction to the Constitution of India (10th ed.). South Asia Books. ISBN 0836410971.
    • Basu, Durga Das (1981). Shorter Constitution of India. Prentice-Hall of India. ISBN 9780876922002.
    • Das, Hari Hara (2002). Political System of India. Anmol Publications. ISBN 8174886907.
    • Dash, Shreeram Chandra (1968). The Constitution of India; a Comparative Study. Chaitanya Pub. House.
    • Ghosh, Pratap Kumar (1966). The Constitution of India: How it Has Been Framed. World Press.
    • Jayapalan, N. (1998). Constitutional History of India. Atlantic Publishers & Distributors. ISBN 8171567614.
    • Khanna, Hans Raj (1981). Making of India's Constitution. Eastern Book Co. ISBN 9788170121084.
    • Basu, Durga Das (1984). Introduction to the Constitution of India (10th ed.). South Asia Books. ISBN 0836410971.
    • Pylee, M.V. (1997). India's Constitution. S. Chand & Co.. ISBN 812190403X.
    • Pylee, M.V. (2004). Constitutional Government in India. S. Chand & Co.. ISBN 8121922038.
    • Sen, Sarbani (2007). The Constitution of India: Popular Sovereignty and Democratic Transformations. Oxford University Press.ISBN 9780195686494.
    • Sharma, Dinesh; Singh, Jaya; Maganathan, R.; et al. (2002). Indian Constitution at Work. Political Science, Class XI. NCERT.
    • "The Constituent Assembly Debates (Proceedings):(9th December,1946 to 24 January 1950)". The Parliament of India Archive. Retrieved 2008-02-22.

    [edit]External links