Finance Minister Tariq Hameed Karra on Tuesday scripted a new history in Jammu and Kashmir when he presented first ever economic survey of the state in the legislative Assembly.
The economic survey mapped the pluses and minuses of the state economy . He called for the need for devising a focused planning mechanism for Jammu and Kashmir to catch up with the rest of the nation in infrastructure availability. Jammu and Kashmir is facing a huge infrastructural deficit spanning both economic and social sectors and thus it needs to be taken care of on priority basis, he said.
Creating a history the finance minister Tariq Hamid Karra who tabled the first ever Economic Survey Report of the Jammu and Kashmir State here today on the floor of the House, categorically asserted that the document is aimed at setting out broad contextual framework for along term development strategy for the state taking into account its peculiar development problems.
Giving a backgrounder of the event of tabling similar survey report, he said it has been tradition since 1958 when then government under Prime Minister of India Pt JL Nehru presented such a Economic Survey Report a day before the presentation of the Financial Budget.
The state economy, Karra said, is undergoing a critical phase of reconstruction and rehabilitation and the real challenge is to catalyze the existing potential into growth impulses through fiscal mechanism ensuing sustainable long term economic development.
"The nearly two decades of conflict and civil strife has dented governance, institutions, weakened public expenditure management systems and increased transaction costs making it difficult to engender and monitor development, he said and added that this situation has a bearing on the type timing and securing of development reforms initiatives.
He said, both routine development initiatives and special reconstruction activity will synergistically from the basis of the new framework. The state, he said needs to pursue two sets of policies i.e. one for the government finances viz. fiscal policy and other for the economic development the economic policy to achieve the objective of the holistic development and growth.
Karra opinioned that any development policy for the state can't be a series of bundled sequential initiatives but a set of structural initiatives with an underlying long term development framework. He said the structural interventions have to be developed with a view to impact the state's own resource base, maintain sustainability of economic growth and focus on employment generation in private sector.
'Jammu and Kashmir,' the finance minister, said has several characteristics that post major development challenges and have direct bearing on its growth performance.
'The state economy exhibits a high degree of volatility and suffers from limited capacity in the public and private sector, he said adding that the state has a very limited access to the national capital markets. He pointed out that the only type of infrastructure that the state has excess of- is administrative infrastructure.
Karra said an objective assessment of the macroeconomic situation of the state provides a prelude as well as a context to assign the fiscal priorities. 'This is the last year of the 10th plan and since the 11th plan commences from the next fiscal year, references have been made in the survey in sustainable context to the developments over the 10th plan period and that the requirements of economic policy making in the 11th plan, he said.
Elaborating on the highlights of the Economic Survey, the Finance Minister said that as against the annual economic growth of 7.0 per cent at the national level during first four years of the 10th plan the state has achieved 5.5 per cent. During the first two years, the economy registered about five per cent growth, but it is estimated to achieve 5.75 per cent annual average growth during last three years of the 10th plan. He said the Gross State Domestic Product (GSDP) is estimated to be Rs. 25,050 for the year 2006-07.
Karra said the per capita income works out to Rs 17, 174 per annum. This, he said is much below the national average of Rs 25,907 per annum. "And off course, when we look at intra-state per capita-across regions and districts- it is much lower in many cases," he said. The unemployment rate in the state estimated by National Sample Survey Organization (NSSO), Karra said stands on 4.21 per cent.
Compared to this, the unemployment rates at all this India level are lower at 3.09 per cent with 2.31 percent in rural areas and 5.37 per cent in the Urban areas.
Karra said the percentage of population living below poverty line in the rural and urban areas as per the estimates of the expert group of Planning Commission, Government of India stands at 3.97 per cent and 1.98 percent respectively. The corresponding figures at the all India level are 27.09 percent and 23.02 percent. "Given such a huge variation between the national and the state level estimates.
I have asked the planning department conduct a special census survey for determining the families falling below the poverty line in both Rural and Urban areas of the state to get the correct figures," he said. Karra said that the fact that the percentage of population living below poverty line in the rural and urban areas of the state is substantially lower than national average points to the fact that absolute poverty in the state has reduced combining the two trends,
one of the major inferences that we can draw from the Economic Survey is that while absolute poverty has been declining, relative inequality seems to have increased," he said adding that while the lot of poor has widened future.
The finance minister said the lower level of income and adverse distribution as shown by the per capita income and the percentage of population below poverty line is directly a function of poor infrastructure availability. For instance he said, take the case of connectivity. The road length per 100 sq km area in the state is 35.71
kms as against 104.64 kms in the country.
In addition to this, there is a huge disparity in the road density across the districts in the state. The case of communications, Karra said is no different. He said on an average one post office in the state serves an area of 60 square kms as against 20 square km in the country. The tele-density i.e the number of phones per 100 of population in the state is 7.76 (2005-06) the comparable relative tele-density in the country is 13.57.
On the social infrastructure side, Karra said the things look even bleaker he said as on March 2006, on an average one medical institution has to serve 3127 persons. "We have only 111 hospital beds and 48 doctors available at per lakh of population," he said.
Karra said, the literacy rate per 2001 census was 55.52 percent as against 64.84percent at national level'. The female literacy is recorded as 43.0 percent for the state as compared to 53.67 percent of national level and state also registered 71 percent inhabitation covered as compared to 96 percent in the national statistics. Finance minister said building the economic and social infrastructure to reach the national level will take time and require financial resources far beyond what the state has got.
"As such we have to be very judicious and discerning in our allocation with special focus on the critical sectors, he said. Kara said in future Economic Survey would be made regular pre-budget feature to evaluate and monitor the state's economic development. Members from the both the treasury and opposition benches appreciated the move describing it a landmark in
the state. they congratulated the finance minister for initiating the historic process. He made similar statements in the legislative council while laying finance accounts and appropriation accounts reports for the year 2005-06 on the table of the House.
Highlights of presentation of Economic Survey Report (ESR) Kara dared to comment on present economy position and said:-J&K is facing a huge infrastructural deficit spanning both economic and social sectors and needs to be taken care of on priority.
Finance Minister amidst the applauds said:- We have to be very judicious and discerning in our allocation with special focus on the critical sectors be it public or private sector to improve economy of state in general.
Stressing for employment growth, Finance minister said:- Structural interventions have to be developed with a view to impact the state's own resource base, maintain sustainability of economic growth and focus on employment generation in private sector
Kara underlined Economic Survey would be made regular pre-budget feature to evaluate and monitor the state's economic development in near future
ESR has also mentioned the Indo-Pak trade which is below one percent and has stressed for economic bridges between Indo Pak and other parts of Kashmir for positive spinoffs.
Economic growth of 7.0 per cent at the national level during first four years of the 10th plan the state has achieved 5.5 per cent
Per Capita Income which works out to Rs 17,174 per annum much below the national average of Rs25,907 per annum.
Unemployment rate in the state estimated by National Sample Survey Organization (NSSO), stands on 4.21 per cent over all and 7.33 per cent in urban areas as compared to national data of 3.09 per cent with
5.37 per cent in the urban areas.
About communication and road connectivity, Karra pointed out that road length per 100 sq km area in the state is 35.71 kms as against 104.64 kms in the country. State has one post office in the state serves an area of 60 square kms as against 20 square km in the country.
In health sector, Finance Minister pointed out state has only 111 hospital beds and 48 doctors available at per lakh of population to an average of one medical institution to serve 3127 souls.
State recorded literacy rate as per 2001 census upto 55.52 percent as against 64.84 percent at national level' with female literacy at 43.0 percent in state against 53.67 percent of national level.
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