Day: May 16, 2013

N.C. Joshi, Deputy Director(M&C), PIB, New Delhi
In a landmark decision the union Government has abolished the levy sugar mechanism and regulated release mechanism to de-control Indian sugar industry while at the same time ensured that poor segments of the society continue to get sugar at existing subsidised prices by taking upon itself the entire financial burden of distributing sugar through ration shops. A notification in this regard has been issued on May 7, 2013.
By this landmark decision the Government has ensured that the interests of all segments of the sugar economy be it industries, farmers, consumers and poor section of society are safeguarded.
For industries, the measure will give them freedom to sell their produce without any restriction and improve their liquidity position, a improved liquidity will ensure that millions of sugarcane farmers in India will now not have to wait for their due price from sugar millers, while for consumers it means sugar availability will increase in the market by as much as 10 per cent per year.
The Government has decided to reimburse the state governments for purchasing and selling sugar through PDS below the market rate for which it will bear upon itself an additional burden of around Rs 3,100 crore.
The issue of de-controlling of sugar industry was engaging the attention of the Government for a very long time.
There were representations from sugarcane farmers’ associations as well as sugar mills, the major stakeholders of the sugar industry, that a price sharing formula for sugarcane was long overdue.
The Government, too, thought about bringing a level playing field where the interests of the consumers on the one hand and the development of sugar industry on the other hand can be ensured.
The demand for decontrol of sugar has stemmed from cyclic nature of sugar production in the country, which puts the sugar industry at a disadvantage in that they are not able to find it a viable business option finally affecting sugarcane farmers. Starting from a normal year when there are no major cane price arrears, the farmers tend to plant larger area under sugarcane. This leads to increase in sugarcane production with the consequent increase in sugar production which in turn leads to excess stocks resulting in depressed sugar prices and building up of cane price arrears. As a result of lower returns, the farmers tend to take lesser care of the cane and area under sugarcane gets reduced in the subsequent years. The years of reduced production of sugarcane also witness higher diversion of cane for gur making, a significant part of which also finds its way into the liquor industry in the unorganised sector as a substitute for molasses which itself would be in short supply. The lower production of sugarcane and higher diversion combine to produce still lower availability of cane for crushing in sugar mills which results in disproportionately low sugar production.
As a result, the sugar prices rise, the mills get higher returns, the arrears position is taken care of and the farmers get a good price and are encouraged to plant more and the area under sugarcane starts rising again. In two to three years time, this leads to another year of peak production and the cycle starts all over again.
The Central Government was confident of taking the burden arising out decontrol of sugar as the country could achieve sugar production of 263.50 lac metric tonnes during the 2011-12 (October-September) sugar season which was 20 lac tonnes more than the sugar production of 243.50 lac tonnes during the 2010-11 sugar season. While the seasonal variation in sugar production had also started to smoothen in the last 3-4 years, the market price of sugar had remained within reasonable levels all throughout 2012-13 sugar season.
The Rangarajan Committee appointed by the Government to look into the whole gamut of sugar decontrol had observed that levy amounts to a cross subsidy between open market and PDS sugar and, it is not in the interest of general consumer or development of sugar sector and recommended that levy sugar be dispensed with.
So, two crucial issues emanating from the Rangarajan Committee’s report came up before the Government for a decision. These were, one, whether sugar is to be continued as an item under the PDS; and, two, if sugar is to be continued as an item under the PDS, does the current levy obligation on sugar mills need to be continued with or the PDS supplies are to be met through open market procurement.
The options that were available before the Government were quite complex in that it had not only to take the State Governments along, but to look into other critical issues such as increase in procurement cost, problems relating to market distortions including delayed payments for cane price, the subsidy burden, etc.
It was felt that removal of sugar in the PDS could not be acceptable. The major decision to take was that if sugar was to be continued as an item under the PDS, who would bear the extra burden for keeping the delivery at Rs. 13.50 per kg? The extra burden in terms of increase in subsidy owing to decontrol of sugar will be around Rs. 3100 crore excluding distribution cost involved.
At present open market price of sugar hovers around Rs. 32 per per kg., while in respect of retail price through PDS, it is Rs. 13.5 per kg, which has not been revised since 2002. The Government is able to provide sugar at Rs.13.5 per kg by absorbing the subsidy involved in each kg at Rs.6 per kg after buying it from sugar mills at levy price fixed by the Government at Rs. 19.05 per kg.
At present, the total expenditure being incurred by the Government in terms of subsidy for supply of 27 lakh tonnes of sugar under PDS comes to Rs. 2556 crore. With decontrol of sugar, the additional burden would mean absorbing the increase in subsidy component to the tune of Rs. 13 per kg, currently being borne by the individual sugar mills, i.e. the difference between the ex-mill price of Rs. 32 and the levy price fixed on them for the current year, which is Rs. 19.5. The total additional subsidy burden works out to Rs. 3100 crores excluding distribution cost.
The Central Government had decided to take the responsibility of the additional burden in terms of subsidy increase upon itself.
The decision of the Government to partially decontrol sugar has not affected the sugar price in open market also, as there is enough sugar in the country with this year’s production expected to be around 24.5 million tonnes as against a requirement of 22.2 million tonnes.
Now the States will also be free to purchase sugar through a transparent system at the current ex-factory price of Rs. 32 per kg which has been capped for two years.
The Government had ensured that this important decision on partial decontrol of sugar takes care of the interests of sugarcane farmers while also ensuring that the interests of the common man and development of sugar sector. (PIB Features.)

Read more / Original news source: http://manipur-mail.com/sugar-decontrol/

M.V.S. Prasad, Joint Director, PIB, Chennai
At the time of Independence in 1947, India had only three steel plants – the Tata Iron & Steel Company (Jamshedpur), the Indian Iron and Steel Company (Burnpur) and Visveswaraya Iron & Steel Ltd (Bhadravathi), besides a few electric arc furnace-based plants. The period till 1947 thus witnessed a small but viable steel industry in the country, which operated with a capacity of about one million tonne and was completely in the private sector.
From the fledgling one million tonne capacity status at the time of Independence, India has now risen to be the 4th largest crude steel producer in the world and the largest producer of sponge iron. The Indian steel industry is now globally acknowledged for its product quality. During the first three Five-Year Plans (1952-1970), in line with the economic order of the day, iron and steel industry was earmarked for state control. From the mid-50s to the early 1970s, the Government set up large integrated steel plants in the public sector at Bhilai, Durgapur, Rourkela and Bokaro. The policy regime governing the industry during these years involved licensing of capacity, dual-pricing system and control of imports and exports.
Globalisation Benefits Industry
The large-scale capacity creation in the public sector during these years contributed to making India the 10th largest steel producer in the world. Crude steel production grew markedly to nearly 15 million tonnes in the span of a decade. Economic slowdown adversely affected the pace of growth of the steel industry. However, this phase was reversed in 1991-92 with the advent of globalization and opening up of our economy. Control regime was replaced by liberalisation and deregulation. The provisions of the New Economic Policy initiated in the early 1990’s impacted the Indian steel industry in many ways.
Large-scale capacities were removed from the list of industries reserved for the public sector. The licensing requirement for additional capacities was also withdrawn subject to locational restrictions. Private sector came to play a prominent role in the overall set-up. Pricing and distribution control mechanisms were discontinued. Iron and steel industry was included in the high priority list for foreign investment, implying automatic approval for foreign equity participation up to 50%. Freight equalisation scheme was replaced by a system of freight ceiling. While export restrictions were withdrawn, quantitative import restrictions were largely removed.
The system, thereafter, underwent rapid changes. For steel makers, opening up of the economy opened up new channels of procuring their inputs at competitive rates from overseas markets and also new markets for their products. It also led to greater access to information on global operations/techniques in manufacturing. This, along with the pressures of a competitive global market, increased the need to enhance efficiency levels so as to become internationally competitive. The consumer, on the other hand, was now able to choose items from an array of goods, be it indigenously manufactured or imported. This freedom to choose established the sovereignty of the consumer and galvanised steel producers to provide products/service levels in tune with the needs of the consumers.
Slow-down & Turnaround
Large integrated steel plants were set up in the Private Sector while the already existing plants expanded their capacity. This has resulted in the emergence of private sector with the creation of around 9 million tonnes of steel capacity based on state-of-the-art technology. Tariff barriers were either reduced or dismantled while partial float of the rupee on trade account, access to best-practice of global technologies and consequent reduction in costs – all these enhanced the international competitiveness of Indian steel in the world export market.
After 1996-97, the Indian steel industry’s pace of growth slowed down with the steady decline in the domestic economy’s growth rate. Production, consumption and, exports fell below average. Indian steel was also subjected to anti-dumping/ safeguard duties as most developed economies invoked non-tariff barriers. Economic devastation caused by the slowdown of the global economy, Asian financial crisis and the impact of glut created by additional supplies from the newly steel-surplus countries pulled down growth levels.
However, from the year 2002, the global industry turned around. The situation was no different for the Indian steel industry, which by now had acquired a degree of maturity, with emphasis on intensive R&D activities, adoption of measures to increase domestic per capita steel consumption and other market development projects, import substitution measures and thrust on export promotion.
National Steel Policy
The rapid pace of growth of the industry and market trends called for certain guidelines and framework. Thus was born the concept of the National Steel Policy, with the aim to provide a roadmap of growth and development for the Indian steel industry.
The National Steel Policy (NSP) was announced in November 2005 as a basic blueprint for the growth of a self-reliant and globally competitive steel sector. The long-term objective of this policy is to ensure that India has a modern and efficient steel industry of world standards, catering to diversified steel demand. The focus of the policy was to attain levels of global competitiveness in terms of global benchmarks of efficiency and productivity.
The policy sought to facilitate removal of procedural and policy, increased investment in research and development, and creation of road, railway and port infrastructure. It also focused on the domestic sector, but also envisaged a steel industry growing faster than domestic consumption, to enable export opportunities to be realised.
Sponge & Pig Iron
India is also a leading producer of sponge iron with a host of coal based units, located in the mineral-rich states of the country. Over the years, the coal based route has emerged as a key contributor and accounted for 75 per cent of total sponge iron production in the country. India is also an important producer of pig iron. Post-liberalisation, with setting up several units in the private sector, not only imports have drastically reduced but also India has turned out to be a net exporter of pig iron. The private sector accounted for 91 per cent of total production for sale of pig iron in the country in 2011-12.
Besides achieving the rank of the 4th largest global crude steel producer in 2012, India has also made a mark globally in the production of sponge iron/direct reduced iron (DRI). Thanks to mushrooming growth of coal-based sponge iron units, domestic production of sponge iron increased rapidly, enabling the country to achieve and maintain the number one position in the global market. With a series of mega projects and the domestic economy carrying forward the reform process further, the future of Indian steel industry is definitely optimistic. A new ‘Steel Vision’ for the next 20 years is also under finalization. (PIB Features.) With inputs from the Ministry of Steel.

Read more / Original news source: http://manipur-mail.com/steel-vision/

Water is a natural resource, fundamental to life, livelihood, food security and sustainable development. It is also a scarce resource. India has more than 18 percent of the world’s population, but has only 4 percent of world’s renewable water resources with 2.4 percent of world’s land area. There are further limits on utilizable quantities of water owing to uneven distribution over time, as 75 percent of annual rainfall is received in just four months. Also region wise it varies from 10 cm rainfall in Rajasthan to 1000 cm in North Eastern Region. In addition, there are challenges of frequent floods and droughts in one or the other part of the country. With a growing population and rising needs of a fast developing nation as well as the given indicators of the impact of climate change, per capita availability of water is likely to go down from 1545 cubic metre/yr, in 2011 to 1341 cubic metre/yr, in 2025. The increasing demand of water for various purposes will further strain with the possibility of deepening water conflicts among different user groups as drinking water need is going to rise by 44 percent, irrigation need by 10 percent, industry need by 81 percent respectively by 2025.
In view of this, the Ministry of Water Resources prepared the National Water Policy (2012), which was adopted by the National Water Resources Council headed by the Prime Minister on Dec. 28, 2012. This takes cognizance of the existing situation and proposed a framework for creation of a system of laws and institutions and a plan of action with a unified national perspective. The major concern is of the increasing demand which is leading to growing water stress and causing conflicts among citizens / societies as a result of over usage or diversion of water and due to competition amongst different users. Hence, there is a need for greater awareness on water conservation for optimal usage of the existing resources.
Water Conservation is also the key objective of the National Water Mission which is one of the eight National Missions under the National Action Plan for Climate Change. This envisages conservation, minimizing wastage and ensuring more equitable distribution of water resources both across and within States through integrated water resources development and management.
The effective water resources management must be underpinned by knowledge and understanding of the availability of the resource itself, the uses to which water is put and the challenges facing the users of water at all levels of stake holders. This can be done by creating mass awareness on the measures that can be taken to address the challenges affecting every living being.
Implementation
A number of mass awareness activities will be undertaken during Water Conservation Year – 2013 with emphasis on sensitizing the masses on water related issues, encourage them to conserve and use it judiciously.
The policies and programmes of the Ministry of Water Resources will be propagated to create a sustainable society and economy.
An effective and sustained mass awareness programme will be launched with the involvement of all stakeholders to achieve the objectives identified in the National Water Policy, 2012 and National Water Mission.
The multi-dimensional awareness programme will help in development of self-consciousness of the individuals as well as the masses on the issue of water conservation and its judicious use. The activities will be undertaken in all parts of the country so as to touch each and every corner of the country.
As an impact of the above the people will become conscious of the importance of the limited natural resources of water, the ways and means to use water judiciously and addressing the local water related problems, thereby contributing to the sustainable use of water resources through collective responsibility. Each and every individual of this country, be it households, farmers, industrialists, children etc. will be the beneficiary.
List of major activities proposed to be undertaken during Water Conservation Year 2013
1. Painting Competition for children, on water conservation issues
2. Organisation of marathon in States/UTs across the country.
3.Electronic Media Campaign through TV, Radio, Digital Cinema.
4.Print Media Campaign through newspapers, magazines, journals.
5.Participation in Fairs/Exhibitions like ‘India International Trade Fair’ at Pragati Maidan.
6.Organisation of Workshops/Seminars/Conferences on water related issues.
7.Organisation of India Water Week – an international conference cum exhibition
8.Special awareness campaigns in Tribal areas
9.Printing and distribution of awareness publicity material
10.Events for School/college students like essay, quiz competitions
11.Awareness through mass media transport vehicles like Delhi metro, bus back panels, bus shelters.
12.Outdoor publicity through hoardings/banners on water conservation at prominent public places.
13.Visits of School/college children and other stakeholders to project sites for educating them and creating awareness about benefits of programmes/schemes of the Ministry.
14Traditional Media Campaigns like nukkad nataks, jal yatras.
15Preparation and exhibition of short films on water conservation
16 Mass awareness programmes for Industry/Farmers/RWAs and other groups.
17.Organisation of National Congress on Ground Water.
Declaration of the Year 2013 as “Water Conservation Year-2013”
Union Cabinet in its meeting held on 9.5.2013 has given its approval for declaring the year 2013 as “Water
Conservation Year-2013”.
(PIB Features.)
Inputs from the Ministry of Water Resources.

Read more / Original news source: http://manipur-mail.com/year-2013-water-conservation-year/