Core sector gaps holding up growth

Govt has to do tough balancing act

The Planning Commission today criticised the Railways for not implementing any major recommendations of the Tenth Five Year Plan.

It also identified electricity and urban infrastructure as the other areas retarding progress in the core sector.

The Plan body, in its mid-term review, has recommended that the appraisal of the Plan should focus on modernisation of the Railways, to make it more efficient.

The commission has expressed disappointment at the lack of progress shown by the power sector.

In its review, it said that there was a need to correct the trend of under-investment in the sector, which existed since the Ninth Plan and was to be corrected in the Tenth Plan through greater investment in the private and public sectors.

The commission said none of the reforms in the state electricity boards had proved to be viable, with populism in states continuing to impede establishment of a rational electrification strategy.

The operation of state-level electricity regulatory bodies also needed improvement, according to the review.

"The enactment of the Electricity Act does have the potential to bring about dramatic changes, but this can only happen if the states take collateral steps," the approach paper for the mid-term appraisal said.

The review said none of the programmes initiated in the urban infrastructure sector had addressed the issue of changing needs of towns and cities of different sizes in a case-sensitive manner and with a long term perspective.

It said the urban infrastructure sector should overhaul the existing municipal functioning to concentrate on developing mass rapid transport systems, drinking water, sewage and solid waste management systems, urban roads and lighting.

A workable municipal model needed to be conceptualised, the commission added.

The commission, however, noted that the construction sector held a lot of promise for large-scale employment generation, especially for unskilled or semi-skilled workers.

"At present, the potential of this sector is restricted by all manner of land use restrictions and procedural hurdles and by lack of resources to expand public investment in infrastructure. This is an area which needs reform, especially in urban areas," it said.

Another area of concern has been the rural road programme, which has not developed despite it having a similar magnitude of forward and backward linkages as the National Highway Development Programme (NHDP).

The paper said mid-term appraisal of the Plan should examine the issue of total dependency of rural roads programmes on budgetary support, which was the reason for the poor shape of rural roads.

The option for garnering greater resources through cess and borrowings should be explored too. Special programmes for upgrading state and district roads should also be evolved.

The commission has expressed satisfaction at the progress of NHDP, but said the appraisal should document the progress and identify any possible bottlenecks.

Also, the paper said the mid-term appraisal for the aviation sector should look at the progress of initiatives to modernise the Mumbai and Delhi airports, while the ports sector should look at improving inland water and coastal transport.

The telecommunications sector should look at issues of broadband connectivity for development of Internet and spreading benefits of e-governance.

The mid-term appraisal should present an assessment of priority action needed in this area, the approach paper added.