(Sample Materials) Economic Survey & Government’s Plan, Programme & Policies – “Rural & Urban Development”

(Sample Materials)
Economic Survey & Government’s Plan, Programme & Policies – “Rural & Urban

Contents of the Chapter:

  • Introduction
  • Schemes for Urban Development
  • Schemes for Rural Development


The Government of India, in recognition of the role played by
infrastructure in poverty removal, has taken up massive programmes for
construction of both urban and rural infrastructure under different programmes.
Some of the important schemes for development urban sector and rural sector are
elaborated below.


Mahatma Gandhi National Rural Employment Guarantee Act (Mahatma Gandhi NREGA).

In order to design wage employment programmes to fight
poverty more effectively, the Central Government formulated the National Rural
Employment Guarantee Act (NREGA) in 2005. National Rural Employment Guarantee
Act 2005 (NREGA) was launched with effect from 2nd February, 2006. During
2009-10, through an amendment, the NREGA was renamed as the Mahatma Gandhi
National Rural Employment Guarantee Act (Mahatma Gandhi NREGA).

To start with, 200 selected districts of the country were
brought under its ambit. In 2007-08, it was extended to 130 more districts. As
against the original target of 5 years, within three years of its launch,
Mahatma Gandhi NREGA was extended to all the districts from 1st April 2008. The
Act, at present, is being implemented in 625 districts in the country.

Mahatma Gandhi NREGA aims at enhancing livelihood security of
households in rural areas of the country by providing at least one hundred days
of guaranteed wage employment in a financial year to every household whose adult
members volunteer to do unskilled manual work. Unique features of the Act inter
alia include, time bound employment guarantee and wage payment within 15 days,
incentivedisincentive structure to the state governments for providing or not
providing employment as per demand, emphasis on labour intensive works
prohibiting the use of contractors, and machinery, ensuring the creation of
durable community, social and economic infrastructure and assets in the rural
areas. The act also mandates 33 per cent participation for women. The primary
objective of the Act is augmenting wage employment. The choice of works
suggested in the Act addresses causes of chronic poverty like drought,
deforestation 521 and soil erosion, so that the process of employment generation
is maintained on a sustainable basis. The Act is also a significant vehicle for
strengthening decentralization and deepening process of democracy by giving a
pivotal role to local governance bodies, that is, the Panchayati Raj

About 12.4 Cr households have been issued job cards in
MGNREGA since the inception of the scheme. During 2011-12, about 5.04 Cr
households were provided employment through MGNREGA vis a vis 5.09 Cr households
who demanded employment. Out of the 5.04 Cr households who were provided
employment through MGNREGA during 2011-12 , only about 40 lakh households
availed 100 days of employment and the average employment in person days per
household was 43.0, lowest in last four years . Out of the total person days of
employment (216.34 Cr), SC’s& ST’s accounted for about 22 & 18 % respectively.
About 48 % of total person days of employment was taken by women.

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Swaranjayanti Gram Swarozgar Yojana (SGSY)

Assisting the rural poor in self employment by encouraging
group and cluster activities, providing skill development opportunities, credit
linkages and subsidies and creation of marketing opportunities for products has
been another major plank of the Poverty alleviation schemes of the Government.
Lunched on Ist April, 1999. SGSY is an integrated scheme for providing
opportunities of self employment to the rural poor. The assisted families (Swarozgaris)
may be individuals or Groups (Self Help Groups). However, the emphasis is on
Group approach and also with particular emphasis on group formation by women and
the weaker sections.
It has been conceived as a holistic programme of self employment and some of its
salient features are:

  • Organising the rural poor into Self Help Groups (SHGs) through social
  • Key activity and development of activity clusters.
  • Training and marketing support to the Swarozgaris
  • Involvement of NGOs/CBOs Animators in social mobilization and training
    and capacity building of Self Help Groups.

SGSY is being implemented by the District Rural Development
Agencies (DRDAs) with the active participation of Panchayati Ray Institutions,
the Banks, the line Departments, and Non-Governemntal Organisations. In order to
provide incentives to rural artisans, SARAS fairs are also organized in various
parts of the country to promote sale of products produced by Self-Help Groups.

Total of Rs 27402 Cr, including Rs 3752 Cr during 2010- 11
have been made available under the SGSY since 1999-2000 and on the average 76.52
percent of funds have been utilized. Above 41 lakh Self Help Groups including
27.98 lakh women SHGs were formed toll 2010-11. Total of 163 lakh swarozgaris ,
including 45 lakh individual swarozgaris were assisted through SGSY. Of the
total Swararozgaris assisted during 2010-11 , women comprised about 60%, SC/ST
about 48 %, minority 6% and disabled 2 %. In 2011-12 ,till December 10.47 lakh
swarozgaris were assisted , out of which 7.23 lakh (69.07%) were women.

Swarnjayanti Gram Swarozgar Yojana (SGSY) has been
restructured as National Rural Livelihoods Mission (NRLM), now renamed as
“Ajeevika” to implement it in a mission mode in a phased manner for targeted and
time bound delivery of results. Aajeevika recognizes that the poor people have
the potential to come out of poverty with proper handholding, training and
capacity building and credit linkage. Aajeevika also believes that a strong
institutional architecture owned by the poor, enables them to access
institutional credit for various purposes, pursue livelihoods based on their
resources, skills and preferences and also to access other services and
entitlements, both from the public and private sector. Therefore, Aajeevika will
focus on building strong institutions of the poor into Self Help Groups (SHGs),
their federations and livelihoods collectives.

The two major strategic shifts under Aajeevika, vis-à-vis SGSY are that

(i) Aajeevika will be a demand driven programme and the states will formulate
their own poverty reduction action plans under it based on their past
experience, resources and skills base and
(ii) Aajeevika will provide for a professional support structure for programme
implementation at all levels from National to Sub district level in different

In order to improve the present status of women in Agriculture, and to
enhance the opportunities for her empowerment , Government of India has
announced “Mahila Kisan Sashaktikaran Pariyojana” (MKSP), as a sub component of
the Aajeevika.

Indira Awaas Yojana (IAY)

The Indira Awaas Yojana (IAY) initiated in 1985-86, is a
flagship scheme of the Ministry of Rural Development to provide houses to the
Below Poverty Line (BPL) families in the rural areas. The role of the State
Government is limited to releases and to facilitating use of appropriate
technology. The ceiling on construction assistance under IAY is Rs 35,000 per
unit in the plain areas and Rs 38,500 in hilly/difficult areas. For upgradation
of kutcha house, the financial assistance is Rs 15,000 per unit. In addition to
the unit assistance availed under IAY, a beneficiary can also borrow a top-up
loan up to Rs 20,000/- from any nationalized Bank at 4% interest per annum under
Differential Rate of Interest (DRI) Scheme. The allocation amongst districts is
based on 75% weightage to housing shortage and 25% weightage to SC/ST component.
Further, 60% of the IAY allocation is meant for benefiting SC/ST families, 3%
for physically handicapped and 15% for minorities. The IAY houses are expected
to be invariably allotted in the name of women.

During 2011-12, the IAY Guidelines have been relaxed and
modified in 60 identified naxal affected districts. 60 identified IAY districts
are now treated as difficult areas and are eligible for higher rate of unit
assistance of Rs 48,500/- provided in hilly/difficult areas. Since inception of
scheme about 272.83 lakh houses have been constructed with an expenditure of
Rs78986.81 crore (upto end 2011). Further, for the current financial year
2011-12, Rs 10000.00 crore has been provided for Rural Housing, out of this Rs
9491.20 crore has been earmarked under IAY for release to the various districts
of various States for construction of 27.27 lakh houses. Besides this, Rs 500
crore has been kept for homestead scheme. Thus the total earmarking for IAY is
Rs 9991.20 crore. Physical Target for the year has been set at 27.27 lakh houses
out of which till December 2011, a total of 11.07 lakh houses have been
constructed and another 26. 41 lakh houses are under construction.

Rural Housing is one of the six components of Bharat Nirman
Programme. Under Bharat Nirman Programme Phase-I, 60 lakh houses were envisaged
to be constructed through Indira Awaas Yojana all over the country during the
four years i.e. from 2005-06 to 2008-2009. Against this target, 71.76 lakh
houses were constructed with an expenditure of Rs.21720.39 crore. The target for
the next five years period starting from the year 2009-10, has been doubled to
120 lakh houses. During the first two years of the Bharat Nirman Programme
Period-Phase-II, approx. 70.81 lakh houses have been constructed.

Pradhan Mantri Gram Sadak Yojna (PMGSY)

The 100 % centrally sponsored scheme was launched in December
2000 with the objective of providing connectivity by all weather roads to about
1.6 lakh unconnected habitation with population of 500 or above (250 in case of
hills, desert and difficult areas). Till 2010-11, about 3.2 lakh Km length of
roads works was completed at an expenditure of about Rs 80551 Cr. Government of
India has identified ‘Rural Roads’ as one of the six components of ‘Bharat
Nirman’ with a goal to provide connectivity to all eligible unconnected
habitations with a population of 1,000 persons and above (as per 2001 census) in
plain areas and 500 persons and above in the case of hilly or Tribal areas –
Schedule V) with an all-weather road. Upto January, 2012, a total of 42,531
habitations were connected out of 63,940 habitations to be connected and works
for 58,387 habitations was sanctioned. In 2011- 12, a target of 4000 habitation
was set to be covered and 33,000 kms of road length was to be constructed. Till
January 2012, a total of 4142 habitations were covered and 21750 kms of road was

National Social Assistance Programme (NSAP)

This was introduced in the budget of 95-96 and it included
National Old Age Pension Scheme (NOAPS), National Family Benefit Scheme (NFBS)
and National Maternity Benefit Scheme (NMBS). In 2000 a new scheme known as
Annapurna Scheme was launched with an aim to provide food security to those
senior citizens who, though eligible had remained uncovered under the NOAPS.
With effect from 01.04.2011, the eligibility age for old age pension under
IGNOAPS has been reduced from 65 years to 60 years and the amount of pension has
been raised from Rs 200 to Rs 500 per month for those who are 80 years or above.
In view of the modification in age limit, 278 lakh beneficiaries are estimated
to be covered under IGNOAPS against 171 lakh beneficiaries covered during the
year 2010-11.

Indira Gandhi National Widow Pension Scheme (IGNWPS) and Indira Gandhi
National Disability Pension Scheme (IGNDPS)

In February 2009 two new Schemes namely Indira Gandhi
National Widow Pension Scheme (IGNWPS) and Indira Gandhi National Disability
Pension Scheme (IGNDPS) have been introduced under NSAP. During 2011-12, a total
of 14 lakh beneficiaries were expected to be covered under the scheme. 35.23
During 2011-12 , a total of RS 5703.17 Cr were spend under NSAP. Following
figure indicates number of beneficiaries under various components of NSAP.

Integrated Watershed Management Programme (IWMP)

The three watershed programmes of the Department of Land
Resources namely Drought Prone Areas Programme (DPAP), Desert Development
Programme (DDP) & Integrated Wasteland Development Programme (IWDP) have been
consolidated as a comprehensive programme named ‘Integrated Watershed Management
Programme (IWMP)’. A total number of 1898 projects covering an area of 9.079 m
ha were undertaken during 2011-12 and Central funds of Rs 1866 Cr were released.
The cumulative total including as on 31st July 2012 was 5087 projects covering
24.213 m ha area and Central funds release of Rs 4249.33 Cr.

Rashtriya Gram Swaraj Yojna

During 2011-12, 365 gram panchayat ghars were sanctioned in
Chhattisgarh, 277 in Punjab, 162 in UP and a total of 150 in other states –
Haryana, Karnataka, Odisha & Rajasthan . The total units sanctioned since
2006-07 is 4,484 . In addition to this, about 304 units of training
infrastructure has also been sanctioned under RGSY along with 2491 block
resource centres sanctioned under BRGF.

Rural Electrification

The Rural Electricity involves supply of energy for two types
of programmes, namely, production oriented activities like minor irrigation,
rural industries etc. and electrification of villages. While the emphasis is
laid on exploration of ground water potential and energisation of pumpsets/tube
wells, which has a bearing on agricultural production, the accent in respect of
areas covered under the Revised Minimum Needs Programme (RMN P), is on village
electrification. A village will be deemed to be electrified if (1) the basic
infrastructure such as distribution transformer and or distribution lines is
made available in the inhabited locality within the revenue boundary of the
village including at least one hamlet/Dalit Basti as applicable and (2) any of
the public places like Schools, Panchayat Office, Health Centres, Dispensaries,
Community centers etc. avail power supply on demand and (3) the ratings of
distribution transformer and LT lines to be provided in the village would be
finalized as per the anticipated number of connections decided in consultation
with the Panchayat/Zila Parishad/District Administration who will also issue the
necessary certificate of village electrification on completion of the works. The
number of household electrified should be minimum 10% for villages which are
unelectrified, before the village is declared electrified. Rural Electrification
Corporation Limited (REC), a NAVRATNA Central Public Sector Enterprise under
Ministry of Power, was incorporated on July 25, 1969 under the Companies Act
1956. Its main objective is to finance and promote rural electrification
projects all over the country. Rajiv Gandhi Grameen Vidyutikaran Yojana (RGGVY)
was launched in 2005 by merging all ongoing schemes. REC is the nodal agency for
the programme and 90% grant is provided by Government of India and 10% as loan
by REC to the State Governments. The aims under RGGVY are (1) electrifying all
villages and habitations as per new definition; providing access to electricity
to all rural households; and providing electricity Connection to Below Poverty
Line (BPL) families free of charge. The infrastructure to be created under RGGVY
are (1) Rural Electricity Distribution Backbone (REDB) with 33/11 KV (or 66/11
KV) sub-station of adequate capacity in blocks where these do not exist; (2)
Village Electrification Infrastructure (VEI) with provision of distribution
transformer of appropriate capacity in villages/habitations; and (3)
Decentralized Distributed Generation (DDG) Systems based on conventional & non
conventional energy sources where grid supply is not feasible or cost-effective.

Renewable Energy for Rural Application

The Ministry of New and Renewable Energy has been supporting
programmes for the deployment of renewable energy systems and devices such as
biogas plants, photovoltaic systems, biomass gasifiers, solar cookers and other
solar thermal systems, etc. in rural areas of the country. The Ministry has also
been implementing remote village electrification, village energy security test
projects and decentralized biogas-based power generation programmes which

  1. National Biogas and Manure Management Prograqmme (NBMMP)
  2. Small Wind Energy And Hybrid Systems
  3. Small Hydro Power Programme


Jawaharlal Nehru National Urban Renewal Mission (JNNURM)

The Jawaharlal Nehru National Urban Renewal Mission (JNNURM),
which was launched on 3rd December, 2005 is expected to give focused attention
to integrated development of urban infrastructure and services in select 65
Mission cities with emphasis on provision of basic services to the urban poor
including housing, water supply, sanitation, slum improvement, community toilets
etc. The Mission makes available reform-linked Central Assistance over the
Mission period of seven years beginning from 2005-06. There are also
subcomponents under JNNURM to cater to similar needs of the small towns and
cities. The Mission completed five years in December 2010.

The objective of the Mission is to encourage the city
governments to initiate measures that would bring about improvements in the
existing service levels in a financially sustainable manner. The Mission calls
upon states/cities to undertake fiscal, financial and institutional changes that
are required to create efficient and equitable urban centres, and the Mission is
reform-driven, which would largely meet the challenges of urban governance.

Under National Urban Sanitation Policy launched in 2008 with
the vision of all Indian cities and towns becoming totally sanitized, healthy
and liveable to ensure and sustain good public health and environmental outcomes
for all their citizens with a special focus on hygienic and affordable
sanitation facilities for the urban poor and the women, various activities are
being taken up. These include rating of towns and cities on sanitation. Service
level benchmarks have been laid down for municipal services. The Ministry is
supporting capacity building at various levels, including the urban local bodies
and the State personnel in areas related to governance, financial management,
and service delivery. The Ministry has set up 13 centres of Excellence 9 for
urban development and 4 for urban transport in reputed institutions across the

Schemes for Basic Services to Urban Poor (BSUP) & Integrated
Housing & Slum Development Program (IHSDP) are administered by Ministry of
Housing & Urban Poverty Alleviation. Rajiv Awas Yojna aims at slum free planning
of cities whereby cities would be developed as per ‘Whole City’ concept
redeveloping the slums, providing basic infrastructure including affordable
housing and sanitation.

National Urban Sanitation Policy

The Government of India launched the National Urban
Sanitation Policy in December 2008. The main goal of the policy is to transform
urban India into community driven totally sanitized healthy and liveable cities
and towns. The vision of the policy is that all Indian cities and towns become
totally sanitised, healthy and liveable and ensure and sustain good public
health and environmental outcomes for all their citizens with a special focus on
hygienic and affordable sanitation facilities for the urban poor and women.
Awareness Generation and Behavioral Change; Open Defecation Free cities;
Integrated City Wide sanitation; sanitary and Safe Disposal; and Proper
Operation and Maintenance of all Sanitary Installations are main goals of the

Initiatives taken under the National Urban Sanitation Policy (NUSP) are:

Rating of Cities

The rating has been carried out for 423 cites and completed
in May, 2010. In respect to the Baseline information, eligibility and selection
procedures have been completed. The next rating exercise will be conducted in
2012. The ranking or rating exercise is a bi-annual exercise. The rating
exercise shows that 189 cities are on the brink of public health and
environmental ‘emergency’; needing immediate remedial action. About 44.68% of
the cities are in this category. Another 230 cities need considerable
improvements. Only 4 cities namely Chandigarh, Mysore, Surat and N.D.M.C. are in
a better position.

Communication campaign

The communication campaign included broadcasting of audio spots and jingles
on Radio/FM channels with a view to sensitizing citizens regarding the
importance of sanitation, negative impacts on health and the environment due to
lack of sanitation and most importantly the need to eliminated open defecation.
The jingles have been developed in twelve languages. 4 audio spots and 1 jingle
in 13 languages have been broadcasted in 1st phase.

National Urban Information System (NUIS)

The NUIS scheme launched in 2006 for developing GIS databases
for towns/cities in the country in two scales, i.e., 1:100000 and 1:2000. In
addition utility mapping on 1:1000 scale would also be undertaken for 24 towns.
Presently, 152 towns/cities are under coverage of this scheme. The objectives of
the scheme are to (1) develop spatial and attribute database; (2) use modern
data sources; (3) develop standards; (4) develop urban indices; and (5) built
capacity at State & Local level. The NUIS scheme consists of four major
components (a) Mapping, (b) Systems (HW/SW) (c) National Urban Data Bank and
Indicators (NUDB&I) and (d) Capacity Building.

Scheme for Urban Infrastructure in Satellite Town around seven mega

Ministry of Urban Development has formulated a scheme for
Urban Infrastructure in satellite Town around seven mega cities. The objective
of the scheme are: (1) to develop urban infrastructure facilities such as
drinking water, sewerage, draining and solid waste management etc at satellite
towns/counter magnets around the seven mega-cities and to channelize their
future growth so as to reduce pressure on the mega cities; (2) to implement
reforms such as e-governance, property tax, double entry accounting, creation of
barrier free environment, structural safety norms in compliance with the
National Building Core, water and energy audit of water and wastewater utilities
and implementation of service level benchmarks; and (3) strengthening
implemen-tation of reforms such as levy of reasonable user charges, earmarking
of budgets for basic services and at least 10-15% of housing sites for the urban
poor, formulation of by laws to incorporate provisions for disater manage-ment,
water harvesting and reuse and recycle of waste water and implementation of
Public Private Partnership (PPP) projects.

Accelerated Urban Water Supply Programme (AUWSP)

The AUWSP was initiated in 1993-94 to provide safe and
adequate water supply facilities to the entire population of the towns having
population less than 20,000 as per 1991 Census. Pattern of the Finance by the
Government of India and the State Governments for implementation of water supply
schemes is on 50:50 matching basis. With the launching of JNNURM, underwhic
UIDSSMT formed a subcomponent for creating to Urban Infrastructure including for
water supply and sanitation in Small and medium towns, AUWSP was subsumed in

Renewable Energy for Urban, Industrial and Commercial Application

The solar energy and technologies for energy recovery from
municipal, industrial and commercial wastes have been promoted by the Ministry
of New and Renewable Energy for meeting certain niche energy demands of urban,
industrial and commercial sectors in the country. The Programmes, namely, ‘Solar
energy systems and devices including solar thermal and photovoltaic systems’ and
‘Energy recovery from urban, industrial and commercial wastes iii) Bio-energy
and cogeneration in industry’ are being implemented. Solar Thermal Energy
programme of the Ministry aims at meeting certain niche energy demands of rural,
urban, industrial and commercial sectors in the country. Research and
development, solar water heating, solar air heating / cooling /crop drying,
solar cooking, solar green buildings and solar cities are the main components of
the programme.

Programme on Energy Recovery from Urban Wastes

There is a need for increased efforts to manage and safely
dispose the increasing quantities of solid and liquid wastes caused by rapid
urbanization, industrialization and changes in life style across the country.
Technologies are now available that help in generating substantial quantity of
decentralized energy besides reducing the quantity of wastes for their safe
disposal and reducing its adverse impact on the environment. According to a
recent estimate, over 55 million tones (1.5 lakh tones per day) of sewage, are
generated every year by our urban population. This translates into a potential
for generation of over

26 MW of power from urban wastes in the country. The
estimated potential of energy from MSW upto the end of 11th and 12th five year
Plans is estimated as 3650 and 5200 MW, respectively. Similarly, it has been
estimated that there is a potential for recovery of about 1300 MW of energy from
solid and liquid wastes generated by various industry sectors such as, sugar,
pulp and paper, fruit and food processing, sago/starch, distilleries, etc. The
major benefits of recovery of energy from wastes are to bring about reduction in
the quantity of waste, cost of waste treatment, demand for land as well as cost
for transportation of wastes to far-away landfill sites and environmental
pollution, besides generation of substantial quantity of energy. The Ministry of
New and Renewable Energy is promoting setting up projects for recovery of energy
from wastes under separate programmes for urban and industrial wastes.

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