Structural changes in Indian Economy

Structural Change in Indian Economyas reflected by

Use of Statistics

Prof. Nand DhamejaIIPA

20/10/10

Structural Change in Indian Economy: Coverage

Indian Economy Changes Over the Years International Trade

Saving & investment rate

Infrastructure Investment

Private Sector Share & disinvestment

School Education: Private Share

Role of Statistics

Structural Change over the years

International trade to GDP increased

over the years ↑

Saving & Investment Rates ↑

Investment in infrastructure ↑

Private sector share in Plan Investment ↑

Structural Change over the years

1980 2009

Public Sector Profit to Total Corporate Profit

70% 35%

Private Sector Profit to Total Corporate Profit

30% 65%

Public Sector Investment

Total Plan Investment

50% 20%

Private Sector Investment

Total Plan Investment

50% 80%

Addition of Power Generating capacity by Private Sector

15% begining of Plan

50 %

now

Structural Changes over the years

Public Sector still dominates in services like, Banking,

Insurance, Energy, Transport

New Areas opened to Private Sector Airports; Ports;

Highways

Disinvestment Realisation Rs 50,000 cr. till 2004-05;

Target current year Rs. 40,000 cr.

Fifteen PSUs Privatised with Disinvestment proceeds

Rs. 11,500 cr.

Policy of Free Pricing for oil

Infrastructure Investment Estimates (Rs. Lakh Crore)

XI Plan

( 2007-8-- 11-12)

X Plan

(2002-3-- 6-7)

Total 20.06

(7.53%)

8.8

(5.63%)

State Sector

Private Sector

14.06

6.00

7.20

1.60

Infrastructure Investment : Sector wise (Rs. Crore) 2006- 07

Prices

X Plan % XI Plan %

Electricity

Roads & Bridges

Telecomm.

Rlys. (inl. MRTS)

Irrigation (incl.

Watershed)

Water Supply &

Sanitation

291,850 33.1

144,892 16.5

123,411 14.0

119,658 13.6

111,503 12.7

64,803 7.4

616,526 30.4

311,816 15.4

267,001 13.2

258,001 12.7

223,131 11.0

199,127 9.8

Infrastructure Investment : Sector wise (Rs. Crore) 2006- 07 Prices

X Plan % XI Plan %

Ports 4096 0.5 73941 3.6

Airports 6771 0.8 34748 1.7

Storage 4819 0.6 22378 1.1

Gas 8713 1.0 20500 1.0

880516 100 2027169 100

National Income Estimates: Sector-wise %

Services 54

Manufacturing & Mining 24

Agriculture 22

Saving Rate % of GDP

93-04 99-00 01-02 07-08 09 -10

Saving % GDP-Total

22.5 22.3 24.0 32.0 34.0

Household Sector

18.4 19.8 22,5 24 26

Private Sector

3.5 3.7 4.0 4.0 4

Public Sector

0.6 (-) 1.2 (-)2.5 4.0 4

Expenditure % GDP

1990-91 2006-07

Governments Expense % GDP

(Center Share

States Share)

35

(54

46)

37

(44

56)

School Education: Private Sector Share

Private sector share in School Education 2006: (no. in Per cent) Higher Secondary Schools

& Junior Colleges 30.05 High Schools 27.15 Upper-primary schools 6.75 Primary schools 3.19 Pre-primary schools 5.15

Elementary Education

Elementary Education for allRight to Education Act 2009

promises free education to children 6 to 12 years

India becomes one amongst 139 nations that legally protects right of children to basic education

Elementary Education

Elementary Education for all Children between 6 to 12 years

Estimated additional Costs : Four alternatives

Scenario I Rs. 426,259 cr Scenario II Rs. 393,307 cr Scenario III Rs. 346,209 cr Scenario IV Rs. 321,196 cr

PPP & Elementary Education: Alternatives

Public-private partnerships: option 1-Charge from

those who can afford For below poverty line state to pay 30%

Public-private partnerships: option 2-Public funding

of capital costs and operating costs met from fees or

other revenues generated

Sweet soft loan to private partner for capital cost

private partner permitted to use premises for revenue

generating during off-times

PPP & Elementary Education: Alternatives-Contd.

Public-private partnerships: option 3-

Contracting out the public schools to

corporation

Public-private partnerships: option 4-

public funding for private schools

Public-private partnerships: option 5-

Tax Policy & Education Funding

PPP & Elementary Education: Alternatives-Contd.

Public-private partnerships: option 6- Existing Private school to share the proposed fund requirement

Public-private partnerships: option 7- providing parents with a choice

Elementary Education : certain Facts

One-third children cannot read & India has largest number of illiterates, about 35 % of 110 cr

By 2020, this to shoot up to 50 % still of larger population (UN Estimates)

School Education

Sarva Shiksha Abhiyan (SSA) launched a

decade ago in 21 states to ensure

elementary education by 2010

However, facts are different Surveys

indicate, one-sixth Indian still unaware of

Right to Free Education

Urbanisation in China- Social Change

Population 1300m% in Cities 33%% in cities in 2020 67%Life Expectancy 73 yrLiteracy Rate present 91%Literacy Rate 1985 34%Water Basins declared highly polluted:

one/third Environment & health problems likely cost:

$54b pa

Statistics: Uses & Misuses

Statistics is a science of collection, organising and interpretation of data

Adds to Quality, reliability to the analysis & makes it logical, dependable and verifiable

Misuses: For a drunken man, it is a lamp-post used for support

rather than illumination There are three kinds of lies: lies, damn lies, and

statistics

Statistics will prove anything, even the truth

Thank You

Good Day