NITI AYOG- 3 year Action Agenda

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NITI AYOG- 3 year Action Agenda

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Key Takeaways

The three-year action plan (2017-2020), prepared by think-tank NITI Aayog, has suggested shifting the composition of expenditures by allocating a larger proportion of additional revenues that become available over time to high-priority sectors. The action plan has replaced the five-year plan plans of the erstwhile Planning Commission and would be soon followed by a fifteen year vision document and a seven year strategy document.

In order to continue fiscal prudence, fiscal deficit is set to reach its eventual target of 3% of GDP anchored under the Fiscal Responsibility and Budget Management (FRBM) framework by 2018-19, while revenue deficit is expected to fall to 0.9% of GDP by 2019-20. Doubling of farmers income by 2022 is based on a combination of efforts to increase farm productivity and provide a concrete framework of remunerative pricing of agriculture output. Efforts include use of more land for farming by adopting better methods of contract farming, connecting hinterland with roads and digital connectivity, and reform of Agricultural Produce Market Committees to enhance reach of markets for farmers. A planned diversification of farming into high-value commodities such as horticulture, dairying, poultry, piggery, small ruminant husbandry, fisheries and forestry will be the path of growth.

It suggested ways to facilitate urbanisation in the country and deal with key challenges like affordable housing, infrastructure development, public transport and promotion of Swachh Bharat.

It also suggested host of actions to eliminate corruption and black money, and increase tax base besides recommending reforms in civil services and electoral process.The suggestions for reforming the judicial system revolve around streamlining human resource availability and performance, increasing and strengthening avenues for dispute resolution and extensive use of ICT to improve efficiency.

In order to leverage efficiencies of digital, it is essential to develop a physical digital infrastructure network that is accessible to all. It should also create a host of software-driven services including government services that can be provided digitally. Information, communications and technology will continue to be the backbone of the development of the country.

Acceleration of growth is contemplated by identifying potential growth areas. Putting them into action in various sectors of the economy is essential. These potential focus areas include infrastructure, digital connectivity, PPPs, energy, science and technology, creation of an effective innovation ecosystem, among others.

On Education

Niti Aayog in its Three Year Action Agenda 2017-18 to 2019-20, said that the government needs to create 20 world-class universities, provide autonomy for top colleges and universities, reform the regulatory system, establish system of project-/researcher-specific grants and increase focus on vocational and profession-led education.

Stating that the skill development initiatives by the government have not yielded the desired result and the country still faces a challenge of training a large workforce, it recommended that for those who undergo skill training, the National Skill Development Corporation (NSDC) should target a placement rate of 80 per cent or more by 2020.

In its agenda report, it said that there is a need for greater focus on improving quality higher education.The Aayog has suggested a series of measures to improve learning outcomes and improve skills for jobs. It has recommended changes in the Right of Children to Free and Compulsory Education (RTE) Act to focus on learning. Improving quality of higher education and NSDC working on achieving an 80 per cent placement target are among the other suggestions given by the think-tank, to improve education and skills of people.The Aayog has pitched for overhaul of the University Grants Commission (UGC).

The UGCs position as an overarching regulator of every aspect of higher education from student fees to curriculum to teaching and course hours keeps Indias higher education system from responding to the changes and challenges that it faces in a fast-evolving world.

Skill development.

The Aayog noted that despite a numerous skill development initiatives by the government that have been undertaken till date, the country still faces a challenge of training a large workforce. Estimates suggest that only 2.3 per cent of Indias workforce has undergone formal skill training, compared to United Kingdoms 68 per cent, Germanys 75 per cent, USAs 52 per cent, Japans 80 per cent and South Koreas 96 per cent, the report said. According to estimates for the period 2013-14, Indias annual skilling capacity at around seven million is significantly lower than the workforce entering the market annually, while the quality of skills imparted is also a matter of concern.

According to the Skill Development Sector Achievements report, December 2016, the NSDC partners skilled 24.9 lakh people, of which 12 lakh were placed in 2014-15. This translates to a placement rate of below 50 per cent. It is recommended that a target of a placement rate for 80 per cent or more should be set for 2020.

The Agenda also recommended a national-level Overseas Employment Promotion Agency that should be set up under the Ministry of External Affairs to consolidate all the promotional initiatives of the government.

Quality improvement through improved governance is one way of slowing or reversing this process. These measures include a focus on school leadership, administrative tenure, basic monitoring by administrators to resolve school level issues such as teacher absenteeism, and transparency in teacher appointments and postings/transfers.

On Manufacturing

While TYAA has set the tone for growth, it is essential to work out specific strategies to develop entrepreneurial culture across unit levels. Monitoring progress is equally important. In the process, those seeking jobs should become employers of tomorrow. As part of ease of doing business, entrepreneurs should be encouraged to set up units under MSME. If growth agenda is to be pursued in the next three years, MSME sector must be provided sufficient bank loans, skilled and semi-skilled workforce. The sector consists of 36 million MSME units, and employs over 80 million people. Though MSME units produce more than 6,000 products, their employing potential is still very low. It contributes about 8% to GDP besides 45%to the total manufacturing output and 40% to exports from the country. In fact, the MSME sector has the potential to spread industrial growth across the country and can be a major partner in the process of inclusive growth. Agriculture, agro processing and manufacturing will continue to be the mainstay of the economy. Taking cue from the TYAA of NITI Aayog, all economic intermediaries will have to rise above their current levels and provide their best to derive the full benefit of the action agenda.

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