Interview tips by IAS topper Gaurav Agarwal

Economics Issues

Thursday, April 24 2014, 7:28 PM

Nayar Committee Report

But, more importantly, as the report itself highlights, public sector banks in India are caught in a triple whammy: deteriorating asset quality, massive capital requirements stemming from Basel III norms, and a complete lack of strategic manoeuvrability, given their current governance and management structures. While the report addresses issues relating to the governance of private banks as well, its most significant recommendations could put the entire public sector banking system on to a new, sustainable performance and risk management trajectory.

The committee shares the widespread perception that excessive and misdirected government control is at the heart of the problem. Consequently, it believes that reducing the government equity stake to minority levels and then empowering boards and managements to function within the performance and accountability frameworks of typical corporate organisations is the best way for these banks to get themselves out of the three-way trap

Nayak Committee Report
What it would like is for the government to distance itself from several bank regulatory functions it discharges. To do this, it would like the repeal of the Bank Nationalisation Act of 1970 and 1980, SBI Act and that relating to its subsidiaries; all banks should be incorporated under the Companies Act.

The governments holdings should be transferred to a Bank Investment Company (BIC) along with its regulatory functions. The governments holdings in PSBs should come down to less than 50 per cent, but it can and will remain the dominant partner. But its regulatory functions will now pass to the BIC. At this point, one might think that the Nayak Committee is talking about privatisation. Its concerns, however, seem to lie elsewhere.

The key lies in the appointment of boards and senior officials in banks. Right now the finance ministry plays big brother with most appointments of bank chiefs. Under the new dispensation, a Bank Boards Bureau would deal with senior level appointments till the BIC is formed. Eventually, at the end of a three year process, however, the responsibilities would rest with the boards themselves.

It is interesting that among other things, the committee should list the RTI Act as a deterrent. Look across the spectrum of services Indian citizens are offered and you will find a similar sentiment expressed by bureaucrats and even prestigious higher educational institutions.

. A core recommendation is to unshackle banks from government control and finance ministrys interference, by reducing government holding to under 50% and bringing banks under the sole regulation of RBI. It suggests that when government shareholding is brought below 50%, the rest should be transferred to a bank investment company (BIC).

The committee recommends the creation of a category of authorised bank investors (ABIs) who

can invest in banks without prior approval.

It recommends that these privatisedPSU banks be removed from dual regulation of the finance ministry and RBI and brought solely under RBI.

Q. Give me few problems ailing our economy and solutions to address them ?

1.  Low growth - manufacturing as well as services.
2.  Stalled projects.
1.  Multiple clearances, bureaucratic red tape.
2.  Indias rank in the World Banks Ease of doing business index fell from 116 out of 189 countries in 2006 to 134 in 2013—clear evidence of stalled reforms. The new government  needs  to  reverse  this  trend  and  improve  thenvironment  fodoing business.
3.  Unskilled workers / low human capital development.
1.  Rope in private sector, allow for profit.
4.  Supply side constraints in infrastructure - roads, power plants.
1.  Road sector - fresh bids, independent regulator to oversee performance, CAG audit.
2.  Power sector - free up coal mining, pass through mechanism, discom reforms, CAG
3.  Ports sector - free up port management and construction.
4.  Railways sector - More PPP, independent regulator and auditor.
5.  Uncertain policy environment.
1.  Increase transparency, reduce discretionary decision making.

in recent years the lack of fiscal discipline has been costly for the Indian economy, as excessive demand arising from large deficits translated into stubbornly high inflation and was partly responsible for large current-account deficits. Fiscal discipline should be a priority, not an afterthought.

improving the quantity and quality of education and healthcare through partnerships with the private and non-profit sector and researchers is essential to sustain growth beyond the next five years.

There are currently three ministries in the energy sector—power, petroleum and natural gas, and renewable energy. It makes sense to fuse them into a single ministry. The recent problem of power plants being built without proper coal supplies could have been avoided if policy had been handled by one minister.  There is no need for a ministry of information and broadcasting, as the former minister in charge of the portfolio, Manish Tewari, reportedly admitted last week. Is there a need for a separate ministry of urban poverty alleviation? A ministry of culture? A ministry of heavy industries? And a ministry for at micro, small and medium enterprises? What about a ministry of pensions?

Foodgrain stocks, as on April 1, 2014, were estimated at 38 million tonnes, way above the minimum buffer requirement. To the extent that there is a speculative increase in foodgrain prices, the government should aggressively sell its stocks in the market.

From all counts, there would be an avalanche of capital inflows in the immediate ensuing period; this would

swell domestic liquidity and generate inflation, unless immediate countervailing measures are taken.

The opportunity should be used to build up the forex reserves. Also, there should be a tilt towards longer-term flows rather than short-term flows and more foreign direct investment rather than portfolio investment.

The share of manufacturing in GDP declined from 14.8 per cent in 2011-12 to 14.1 per cent in 2012-13 and to 12.7 per cent in 2013-14, implying that this sector is steadily losing its relevance in the economy, and that the real economy is weakening.

Poor growth of the manufacturing sector has resulted in joblessness. This can be gleaned from the performance of two sub-segments of manufacturing — capital goods and consumer durables. Both segments are highly intensive in the use of components and ancillaries, and thereby encourage growth of large number of small and medium scale industries as they grow.
Any crisis in these two sub-segments affects the supporting SMEs and gives rise to unemployment. Growth in capital goods and consumer goods sectors suffers due to lack of investment and consumption
demand. In the case of basic and intermediate goods, however, growth is hampered by lack of governance
and excessive regulatory hurdles and interventions.
Govt should follow cluster approach and give investment incentives.

Q. What are 2nd generation reforms.

1.  Manufacturing reforms
1.  Labor reforms.
2.  Land acquisition.
3.  Multiple clearances and single window.
2.  Governance reforms
1.  Transparency and rule of law.
2.  Rationalization of subsidies.
3.  Restructuring of government schemes.
3.  Trade reforms
1.  GST and unified market.
4.  Financial reforms
1.  Financial sector liberalization and more competition.
2.  FSLRC recommendations.

Q. Whether subsidies good or bad?

1.  In  a  poor  country  like  India,  certain  subsidies  are  essential.  Eg.  talk  about  PDS  and
Himanshu's findings.
2.  What we need is to plug leakages in the subsidies.
1.  UID was a good initiative, but after SC's decision, its fate is undecided.
2.  Still we can reform subsidy regime by use of IT and mobile. eg. PDS.
3.  Also we can create NREGA like architecture where demand is generated from the bottom and is backed by legal rights.
4.  We also need effective grievance redressal mechanisms.

5.  Social audits.
3.  The Indian media rails against the governments fiscal irresponsibility” in introducing food subsidies, but the government spends far more on subsidies for the rich, including 1% on electricity and 1% on diesel and petroleum products, which benefit the middle classes.

Q. What should we do to promote manufacturing sector?

1.  Cut red tape, reduce number of clearances, single window mechanism. Transparency, reduce discretions.
2.  Reduce compliance costs.
3.  Labor laws.
4.  Develop infrastructure.
5.  Skill development.
6.  Land acquisitions.
7.  Friendly policies.

Amartya Sen

Nobel Prize

1.  Sen got the noble prize for his work in - social choice (Impossibility theorem), distribution, poverty (Capabilities based approach).

Sen's Capabilities Based Approach

1.  Functionings are states of being and doing’  which measure an individual's well being such as being well-nourished, having shelter.
2.  Capability refers to the set of valuable functionings that a person has effective access
to. Capability represents the effective freedom of an individual to choose between different functioning combinations.
3.  Freedoms = capabilities. Unfreedom = deprivation of capabilities.
4.  Poverty is a serious deprivation of certain basic capabilities to live a good life, and
development’ is understood as capability expansion.
1.  Income approach to poverty is not enough: Defining poverty as simply income below an accepted level is not enough as there can be variations in converting this income into various capabilities. These variations may arise due to personal, environmental, social factors. Hence the need to go beyond income in poverty measurement.
2.  Utility approach to poverty is not enough: People can internalize the harshness of their circumstances so that they do not desire what they can never expect to achieve. This is the phenomenon of adaptive preferences’ in which people who are objectively very sick may, for example, still declare, and believe, that their health is fine.
3.  Resource based approach to poverty is not enough: Because it only focuses on what goods a person has, not what he can do with those goods.

Q. sen's policies have become irrelevant now.

1.  Not irrelevant, but the new government may be less guided by them.
2.  In fact rights based approach is in alignment with the new thought in administration that the citizen must be empowered and government held accountable. RTI, NREGA are examples of success.
3.  What we need is to cut down on wasteful expenditure and red tape, opacity. We need to increase transparency and rule of law.

Q. Compare n contrast bhagwati sen model

1.  Bhagwati model
1.  He talks of 2 track reforms. Track 1 reforms are reforms aimed at boosting GDP growth and industrialization. It involves building infrastructure, increasing transparency, incentives to industry etc.
2.  Track 2 reforms which will follow track 1 are increased state spending on education and health.
3.  Track 2 can follow track 1 because: a) Track 1 will help lift people out of poverty via additional jobs and incomes. b) Track 1 will also generate revenues for the state to spend on track 2.
2.  Sen model
1.  Public provision of health and education is a must because if labor are not educated and healthy, they cannot have high productivity and growth will not increase. There is not a single example in the world where development has been possible without investing in education and health.
2.  Sen is not against growth, but he says we must also focus on what this growth does to people's lives.

Q Compare n contrast bihar n gujarat model. Which one do we need?

1.  Bihar model
1.  State actively engaged in promoting education, food and health facilities to citizens.
2.  Gujarat model
1.  State creates a business friendly environment. Private investment led model.
3.  What we need?
1.  We need a synthesis. India is too big a country where conditions in one part are completely different from another part. For example, in a state like Bihar where poverty and illiteracy are high, government incentives are needed for people to study up to class X. But such a thing is unnecessary in Gujarat where already literacy rates are high. If people are illiterate, then just focusing on private investment will not work to promote an inclusive growth.
2.  We need to focus on what kind of growth we are having. We need a growth which creates jobs.

Q. what happened in recent wto?

1.  Trade facilitation: A deal was reached. Red tape and delays have to be cut in allowing international trade.

2.  AoA: India got a 4 year peace clause after which the fate of subsidies will be decided.

RBI Monetary Policy Review

Recent Policy Action (April 1)

1.  Increased the liquidity provided under 7-day and 14-day term repos from 0.5% of NDTL to
0.75% in line with Urijit Patel committee recommendations, and decrease the liquidity provided under the overnight repos from 0.5% to 0.25%. The primary objective is to improve the transmission of policy impulses across the interest rate spectrum.
2.  Policy stance
1.  Kept repo rate under LAF unchanged at 8%.
2.  The policy stance is firmly focused on keeping the economy on a disinflationary glide path that is intended to hit 8 per cent CPI inflation by January 2015 and 6 per cent by January 2016.
3.  Furthermore, if inflation continues along the intended glide path, further policy tightening in the near term is not anticipated at this juncture.

Macro Forecast

1.  GDP growth
1.  Itis expected to pick up from below 5% in 2013-14 to 5 - 6% in 2014-15 though with downside risks to the central estimate of 5.5 per cent.
2.  Positive factors

2.  CAD

1.  Progress on the implementation of stalled projects already cleared.
2.  Stronger anticipated export growth as the world economy picks up.

1.  CAD is expected to be about 2.0% of GDP for 2013-14.
3.  Inflation
1.  Forecast of 8 per cent CPI inflation by January 2015.
2.  Risk factors
1.  Vegetable prices have entered their seasonal trough and further softening is unlikely.
2.  El Nino and uncertain rainfall.
3.  Uncertainty on the setting of MSPs.
4.  Uncertainty in fiscal policy.
5.  Geo-political developments and their impact on international commodity prices.
6.  There will also be a downward statistical pull on CPI inflation later this year, due to base effects from high inflation during June-November 2013.

Urijit Patel Committee Recommendations

1.  Some recommendations of Dr. Urjit R. Patel Committee report have been implemented including
1.  Adoption of the new CPI (combined) as key measure of inflation.
2.  Explicit recognition of the glide path for disinflation (8% for Jan 1015, 6% for Jan 2016,
4% thereafter).
3.  Transition to a bi-monthly monetary policy cycle.
4.  Progressive reduction in access to overnight liquidity under the LAF at the repo rate and a corresponding increase in access to liquidity through term repos, and

introduction of longer term repos.

Bimal Jalan Committee Recmmendations

1.  RBI will work to give licenses more regularly, that is virtually on-tap.
2.  It will also set out categories of differentiated bank licenses that will allow a wider pool of entrants into banking.

Market Development Efforts by RBI

1.  Inflation bonds
1.  To expand investor demand, design changes improving their attractiveness to the general public are being worked out.
2.  Corporate bonds
1.  Banks will be allowed to offer partial credit enhancements to them.
3.  Re-repo of g-secs.

The feasibility of limited re-repo/re-hypothecation of repoedgovernment securities is being explored.The idea of rehypothecation typically works not so much with term repos but reverse repos, with somebody sort of lent money and suddenly feels that they have a squeeze on their reserve they want to relend to somebody else, rehypothecation allows that. So as you move to term reverse repos this will be a helpful thing, and we are exploring it, we think we can do it without much risk.

FIIs may be allowed to hedge their currency risks through exchange traded currency futures.
KYC norms are being simplified for Foreign Portfolio Investors.
To encourage longer-term flows and reduce volatility, FPI investments in G-Secs will henceforth be permitted only in dated securities of maturity one year and above, and existing investments in T-bills will be allowed to taper off on maturity/sale. Any investment limits vacated at the shorter end will however be available at longer maturities, so overall FPI limits will not be diminished.

Q. Should we have differentiated licenses?

This will allow people to develop banking capabilities even with relatively small size of operations, which will then allow them to may be apply for full banking licenses down the line.

Q. Does it make sense to augment FX reserves at this stage?

1.  If you focus only on reserves there is really no point at which you feel safe, because provided there is enough uncertainty about the economy, uncertainty about conditions, uncertainty about the treatment of international investors, 400, 500, 600 any level of reserves, until you get to Chinese levels,  is probably not enough.
2.  So really our focus should be on creating the policy environment which gives investors confidence.
3.  Our intervention in exchange markets have historically been to reduce exchange rate volatility. So to the extent that we have to intervene to prevent that kind of volatility, we have plenty of reserves.

Five Pillars of RBI's Developmental Measures

1.  Clarifying and strengthening the monetary policy framework.
2.  Strengthening banking structure through
1.  new entry, branch expansion, encouraging new varieties of banks,
2.  and moving foreign banks into better regulated organisational forms.
3.  Broadening and deepening financial markets and increasing their liquidity and resilience.
4.  Expanding access to finance to small and medium enterprises, the unorganised sector, the poor, and remote and underserved areas of the country through technology, new business practices, and new organisational structures; that is, we need financial inclusion.
5.  Improving the systems ability to deal with corporate distress and financial institution distress by strengthening real and financial restructuring as well as debt recovery.

Global Economy

1.  Since January 2014 statement, global growth outlook remains broadly unchanged though weaker initial data to some extent cloud optimism.
2.  Global economic activity had strengthened in H2 of 2013. On the current reckoning, global growth is likely to be in the vicinity of 3½ per cent in 2014, about ½ a percentage point higher than in 2013.
3.  Downside risks
1.  Tapering of quantitative easing (QE) in the US,
2.  Continuing deflation concerns and weak balance sheets in the euro area and,
3.  Inflationary pressures in the emerging market and developing economies (EMDEs).
4.  Weakening growth and financial fragilities in China.
5.  Capital flows to EMDEs could remain volatile, even if they do not retrench.
Indian Economy

1.  Economic Buffers
1.  These buffers effectively bulwarked the Indian economy against the two recent occasions of spillovers to EMDEs — the first, when the US Fed started the withdrawal of its large scale asset purchase programme and the second, which followed escalation of the Ukraine crisis. On both these occasions, Indian markets were less volatile than most of its emerging market peers.
2.  With the narrowing of the twin deficits – both current account and fiscal – as well as the replenishment of foreign exchange reserves, adjustment of the rupee exchange rate, and more importantly, setting in motion disinflationary impulses, the risks of near-term macro instability have diminished.
2.  Agriculture sector witnessed record production.
3.  Industrial growth stagnating
1.  IIP showed -0.1% during April-Mar 2013-14. Mining -0.8%, Manufacturing -0.8%. Capital goods: -4%, Consumer durables: -12.2%. Growth of core industries remained sluggish at 2.6% during April-Feb
2013-14 compared to a growth of 6.4% in the corresponding period a year ago.
2.  Reduction in excise duty is expected to provide some relief to manufacturing.
4.  Employment scenario showing signs of gradual recovery.
5.  External trade
1.  Apr - March: Exports: $312 bio (+3.9%), Imports: $450 bio (-8.1%), Trade deficit: -$138 bio (vs -$190 bio last year). Oil imports: $167 bio (+2.2%), non oil imp: $283 bio
(-13.3%). Agriculture exports: $45 bio.
2.  March 2014: Exports: $29.5 bio (-3.2%), Imports: $40 bio (-2.1%), Trade deficit: -$10,5 bio (5 month high).

3.  April 2014: Exports: $26 bio (+5%), Imports: $36 bio (-15%). Trade deficit: $10 bio. Oil imports: $13 bio (-0.6%), Non oil: $23 bio (-21.5%).
4.  Slowdown in exports in recent months can be attributed to certain sector specific issues and global factors. For instance, decline in exports of gems and jewellery could be largely reflective of the price effect mainly emanating from an 20.1 per cent y-o-y drop in gold prices.
5.  Fall in exports of petroleum products are largely attributed to lower gross refining margins
6.  Destination-wise, while export demand from economies like the US and China was broadly intact, a significant decline was evident in exports to EU economies, Switzerland, the OPEC region, Singapore and Hong Kong SAR.
7.  Although the decline in imports bodes well from the perspective of a CAD decline, the lowering of CAD on this account may not sustain with the expected revival of domestic aggregate demand.
8.  Surge in capital inflows led to accretion of reserves; the rupee has moved in a narrow
6.  Inflation
1.  CPI: 8.6% in April, 8.31% in March, 8.1% in Feb, 11.2% in Dec.
2.  Decline mainly due to declining vegetable prices. Apart from vegetables, CPI inflation in cereals and products’ posted a significant decline at 9.9 per cent in February 2014 from 12 per cent in November 2013.
3.  Wage price spiral pushed up inflation in the services segment.
4.  Headline inflation has moderated in recent months, but upside risks remain in
5.  WPI: 5.2% in April (lower due to vegetables), 5.7% in March (higher due to food items),
4.68% in Feb, 6.16% in Dec.
6.  Core inflation: 3% (highest since Apr 13).
7.  Efforts to address infrastructure bottlenecks have yielded modest revival so far
1.  Cabinet Committee on Investment (CCI) and the Project Monitoring Group (PMG) had together undertaken resolution of impediments for 296 projects with an estimated project cost of `6.6 trillion.
2.  However, 15-20 per cent of these projects, mostly in roads, power and petroleum, have reported additional
delays, for which the dates of completion have been extended further.
3.  Also, there has been an increase in the number of projects without date of commissioning, mostly in roads reflecting the growing uncertainty about their completion.
8.  While fiscal targets were met in 2013-14 (RE), the quality of fiscal adjustment needs improvement.

IV. Differentiated Bank Licensing- Examining Pros and Cons

A. Arguments in Favour of Adopting a Differentiated bank Licensing

4.1 With the broadening and deepening of financial sector, it is observed that banks are slowly migrating from a situation in the past where the number of banking services offered by the banks was limited and all banks provided all the services to a situation where banks are finding their niche areas and mainly providing services in their chosen areas. Many banks keep the plain vanilla banking as a small necessary adjunct. It is widely recognized that banks providing services to retail customers have different skill sets and risk profiles as compared to banks which mainly deal with large corporate clients.

The present situation where every bank can carry out every activity permissible under Section 6 of Banking Regulation Act, 1949 has the following implications, relevant to the subject under consideration :

For a wholesale bank dealing with corporate clients only, it becomes a costly adjunct to maintain a skeleton retail banking presence. Moreover it becomes difficult for such a bank to meet priority sector obligations and obligations for doing inclusive banking.
Retail banks may have to create risk management and regulatory compliance structures which are
more appropriate to wholesale banks, thus resulting in non-optimal use of resources.
Similar supervisory resources are devoted to banks with different business profiles. This may also result in non-optimal use of supervisory resources.
The priority sector lending regime for foreign banks indicated in paragarph 3.3 has been causing some discomfort for some of the foreign banks. For example, some of the foreign banks find it difficult to fulfil even the less rigorous target of 32 per cent in respect of priority sector advances. Some banks find it difficult to provide ' no frills' facility to economically disadvantaged. For them the more liberal licensing regime causes a different set of problems.
It appears that given an opportunity, some of the banks may like to follow a niche strategy rather than competing as full service all purpose banks.

2. On the other hand, there are some factors which point towards desirability of continuing with the existing system of universal banking:

In India, the penetration of banking services is very low. Less than 59 % of adult population has access to a bank account and less than 14 % of adult population has a loan account with a with a bank. Under such circumstances, it would be incorrect to create a regime where banks are allowed to choose a path away from carrying banking to masses.
Priority sector lending is important for banks. The revised guidelines on priority sector lending have rationalized the components of priority sector. For the first time, investments by banks in securitised assets, representing loans to various categories of priority sector, shall be eligible for classification under respective categories of priority sector (direct or indirect) depending on the underlying assets, provided the securitised assets are originated by banks and financial institutions and fulfil the Reserve Bank of India guidelines on securitisation. This would mean that the banks' investments in the above categories of securitised assets shall be eligible for classification under the respective categories of priority sector only if the securitised advances were eligible to be classified as priority sector advances before their securitisation. These measures would make it easier to comply with the priority sector lending requirements by those banks which had faced some difficulties in this regard.
The business model adopted by such nichebanks depends heavily on ample inter-bank liquidity.
Any shock leading to liquidity crunch can translate into a run on the bank. This situation has been clearly illustrated recently in UK in the case of Northern Rock Bank.

Q how to draw private investments to manage problem to storage of perishable commodities?

1.  One way is FDI in multi brand retail. But for this we need:
1.  Policy certainty.
2.  Reduce red tape.
3.  Not to frame rules which discourage companies.

2.  Another is to boost local entrepreneurship.
1.  Create a favorable ecosystem - ESMA, credit, reduce red tape, give more incentives.
2.  National Food Processing Mission - Mega Food Parks.

Q. GDP of your town

1.  $25 bio.

Q. UPA - 2 is failure ? comment

1.  Result has been good in certain areas and not good in certain other areas.
2.  Success
1.  Social indicators: Poverty, IMR, education.
2.  NREGA - empower rural workers.
3.  RTI.
3.  Failures
1.  GDP growth, stalled investments.
2.  Corruption, lack of transparency.
3.  GST and other critical bills.
4.  Foreign policy.

Welfare Indicators


1.  A long and healthy life: Life expectancy at birth
2.  Education index: Mean years of schooling of adults and Expected years of schooling of 5 year old children
3.  A decent standard of living: GNI per capita (PPP US$)
4.  Indian rank is 136 out of 187 countries @ 0.554 (slight improvement of 0.007 from last year).
5.  Inequality adjusted HDI is 0.392 and rank is 91 (improvement from 93 last year).

1. HDI 0.800 indicates high human development.
2. 0.799 HDI 0.500 indicates medium human development.
3. HDI < 0.500 indicates low human development.

CPI (corruption perception index )

1.  India's rank s 94 out of 177 and is same as last year. Index is maintained by Transparency
2.  The CPI scores and ranks countries/territories based on how corrupt a countrys public
sector is perceived to be. It is a composite index, a combination of surveys and assessments of corruption, collected by a variety of reputable institutions. 0 means that a country is perceived as highly corrupt and a 100 means that a country is perceived as very clean.

Ginni Coefficient

1.  It is computed from the National Sample Survey for 2011-12. In rural areas, the coefficient rose to 0.28 in 2011-12 from 0.26 in 2004-05 and to an all-time high of 0.37 from 0.35 in

urban areas, the figures showed.
2.  India's Gini is 34 and ranks in moderately unequal countries. MDG
1.  Eighteen (18) targets were set as quantitative benchmarks for attaining the 8 MDGs
2.  Out of the 18 targets, 12 targets are relevant to India.
Target No.
Target Description
Halve, between 1990 and 2015, proportion of population below national poverty line
On track
Halve, between 1990 and 2015, proportion of people who suffer from hunger. Measured by underweight children under 3.
Slow or almost off track
Ensure that by 2015 children everywhere, boys and girls alike, will be able to complete a full course of primary education
On track
Eliminate gender disparity in primary and secondary education, preferably by 2005, and in all levels of education no later than 2015
On track for primary and secondary, and off track for higher education
Reduce by two-thirds, between 1990 and 2015, the under-five mortality rate
Moderately on track
Reduce by three quarters, between 1990 and 2015, the maternal mortality ratio
Slow or off track
Have halted by 2015 and begun to reverse the spread of HIV/AIDS
On track
Have halted by 2015 and begun to reverse the incidence of malaria and other major diseases
Moderately on track
Integrate the principles of sustainable development into country policies and programmes and reverse the loss of environmental resources. Energy density of GDP, CO2 emissions per capita, forest cover.
Moderately on track
Halve, by 2015, the proportion of people without sustainable access to safe drinking water and basic sanitation
On track for drinking water, slow for sanitation
By 2020, to have achieved, a significant improvement in the lives of at least 100 million slum dwellers
Not statistically determinate
In cooperation with the private sector, make available the benefits of new technologies, especially information and communication. Internet, mobiles, computer penetration per 100 people
On track

1.  Malnutrition among children (goal 2) is expected to reduce to only 33% as against a
26% by 2015.
2.  IMR target is 27 per 1000 live births and India is expected to miss it.
3.  MMR target is 109 per 1 lakh live births and India is likely to achieve only 139.
4.  Target for drinking water was 17% and has already been achieved. India is likely to universal safe drinking water by 2015.


UNDP report on India's poverty

1.  The estimated number of $1.25 poor in India in 2010 falls from 396 million in 2004-05 to 148 million in 2014. In 2014, the World Bank reported that 11.8%[1]of all people in India fall
below the international poverty line of US$ 1.25 per day (PPP).

Q. Interim budget vs Vote on account

1. Vote-on-account deals only with the expenditure side of the government's budget. The government gives an estimate of funds it requires to meet the expenditure that it incurs during the