Tenth Five Year Plan

The Tenth Five-Year Plan (2002-07) was approved by the National Development Council on 21st December 2002. The Plan has further developed the NDC mandate objectives, of doubling the per capita income in ten years and achieving a growth rate of eight per cent of GDP per annum. Since economic growth is not the only objective, the Plan aims at harnessing the benefits of growth to improve the quality of life of the people by setting of the following key targets: Reduction in the poverty ratio from 26 per cent to 21 per cent, by 2007; Decadal Population Growth to reduce from 21.3 per cent in 1991-2001 to 16.2 per cent in 2001-11; Growth in gainful employment, at least, to keep pace with addition to the labour force; All children to be in school by 2003 and all children to complete five years of schooling by 2007; Reducing gender gaps in literacy and wage rates by 50 percent; Literacy rate to increase from 65 per cent in 1999-2000, to 75 percent in 2007; Providing potable drinking water to all villages; Infant Mortality Rate to be reduced from 72 in 1999-2000, to 45 in 2007; Maternal mortality ratio to be reduced from four in 1999-2000, to two in 2007; Increase in Forest/Tree cover from 19 per cent in 1999-2000, to 25 per cent in 2007; and cleaning of major polluted river stretches.

The Tenth Plan has a number of new features that include, among others, the following:

  1. Firstly, the Plan recognises the rapid growth in the labour force. At current rate of growth and labour intensity in production, India faces the possibility of rising unemployment, which could lead to social unrest. The Tenth Plan therefore aims at creating 50 million job opportunities during the period, by placing special emphasis on employment intensive sectors of agriculture, irrigation, agro-forestry, small and medium enterprises, information and communication technology and other services.
  2. Secondly, the Plan addresses the issue of poverty and the unacceptably low levels of social indicators. Although these have been the objectives in earlier Plans, in the current Plan there are specific monitorable targets, which will need to be attained along with the growth target.
  3. Thirdly, since national targets do not necessarily translate into balanced regional development and the potential and constraints of each State differ vastly, the Tenth Plan has adopted a differential development strategy. For the first time, a statewise growth and other monitorable targets have been worked out in consultation with the States to focus better on their own development plans.
  4. Another feature of this Plan is the recognition that Governance is perhaps one of the most important factors for ensuring that the Plan is realized, as envisaged. The Plan has laid down a list of reforms in this connection.

Finally, considering the present market-oriented economy, the Tenth Plan has dwelt at length on the policies that would be necessary and the design of key institutions. The Tenth Plan not only included a carefully crafted medium-term Macroeconomic policy stance, both for the centre and the States, but also lays out the policy and institutional reforms that are required for each sector.

The incremental capital-output ratio (ICOR) of the economy is likely to come down to about 3.6 as against 4.5 during the Ninth Plan. This decline in ICOR is to be achieved mainly through better utilization of existing capacities and suitable sectorial allocation of capital and its efficient utilization. The growth target, therefore, world require an investment rate of 28.4 per cent of GDP. This requirement will be met from domestic savings of 26.8 per cent of GDP and external savings of 1.6 per cent. The bulk of the additional domestic savings will have to come from reduction in Government dissaving from -4.5 (2001-02) to -0.5 per cent (2006-07) of GDP.

The Tenth Plan has identified measures to improve efficiency, unleash entrepreneurial energy and promote rapid and sustainable growth. Agriculture is to be the core element of the Tenth Plan. Key reforms for the agriculture sector include: Eliminating interstate barriers to trade and commerce; Essential Commodities Act to be amended; Amending Agriculture Produce Marketing Act; Liberalizing agri-trading, agri-industry and exports; Encouraging contract farming and permitting leasing in and leasing out of agriculture lands; Replacement of various acts dealing with food by one comprehensive 'Food Act'; Permit futures trading in all commodities; Removal of restrictions on financing of stocking and trading.

Some other key reform measures include repeal of SICA, and strengthening bankruptcy and foreclosure laws to facilitate transfer of assets; Reform of labour laws; Policy reforms for village and small scale sectors to improve credit, technology, marketing and skill availability, and a phased dereservation of small scale industries; Early enactment of Electricity Bill; Coal Nationalization Amendment Bill and Communication Convergence Bill; Abolish restrictions and encourage decontrol of private road transport passenger services and private sector participation in road maintenance; Early adoption of a Civil Aviation Policy, establishment of a regulatory framework for the sector and development of major airports with active private participation. Likewise, the growing regional imbalances are a matter of concern and the Plan aims at promoting a balanced and equitable regional development. The Plan gives a statewise breakup of the targets in order to provide the requisite focus. The need for urgent policy and administrative reforms has also been recognized.

Governance is perhaps one of the most important factors for ensuring that the Plan is realized, as envisaged. Some steps required in this direction are: Improve people's participation, especially through strengthening Panchayati Raj Institutions and urban local bodies; Involvement of civil society, especially voluntary organizations, as partners in development; Enactment of the Right to Information Act; Civil Service reforms for improving transparency, accountability and efficiency; security of tenure, a more equitable system of rewards and punishments; Rightsizing both the size and role of Government; Revenue and judicial reforms and using information technology for good governance.

The average growth rate in the last four years of the 10th Plan (2003-04 to 2006-07) was little over 8 per cent, making the growth rate 7.7 per cent for the entire 10th plan period. Though this was below the 10th Plan target of 8 per cent, it is the highest growth rate achieved in any plan period.

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